STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE, )

)

Petitioner, )

)

vs. ) Case No. 98-5611

)

KAREN L. HUTCHISON, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a final hearing was conducted in this case before Administrative Law Judge Michael M. Parrish of the Division of Administrative Hearings in Key Largo, Florida, on July 23, 1999.

APPEARANCES

For Petitioner: Elenita Gomez, Esquire

Robert C. Byerts, Esquire Department of Insurance Division of Legal Services 612 Larson Building

200 East Gaines Street Tallahassee, Florida 32399-0333

For Respondent: David Hutchison, Esquire

Post Office Box 1262

Key Largo, Florida 33037-1262 STATEMENT OF THE ISSUE

The issue in this case is whether disciplinary action should be taken against the Respondent on the basis of her failure to timely comply with continuing education requirements established by Section 626.2815, Florida Statutes.

PRELIMINARY STATEMENT

At the final hearing on July 23, 1999, the Petitioner presented the testimony of one witness and had ten exhibits marked for identification. Petitioner's Exhibits 1, 2, 3, 7, 8,

and 9 were received in evidence. Petitioner's Exhibits 4, 5, 6, and 10 were not received in evidence.

The Respondent testified on her own behalf, but did not call any additional witnesses. The Respondent offered three exhibits, all of which were received in evidence.

During the course of the final hearing the parties stipulated to a few facts. 1/ At the request of the parties, official recognition was also take of several matters. 2/

At the conclusion of the final hearing, the parties were allowed 10 days from the filing of the transcript of the hearing within which to file their respective proposed recommended orders. The transcript was filed with the Division of Administrative Hearings on August 17, 1999. On August 27, 1999, the Petitioner filed a Proposed Recommended Order containing proposed findings of fact and conclusions of law. As of the date of this Recommended Order, the Respondent has not filed a proposed recommended order.

FINDINGS OF FACT

1. The Respondent is currently licensed by the Florida Department of Insurance ("Department") as a General Lines (2-20) Agent. During the period from August 1, 1995, through July 31,

   1997, the Respondent was licensed as a General Lines (2-20) Agent and as a Life, Health, and Variable Annuity (2-15) Agent.

2. At all times material to this case, insurance agents licensed in Florida have been required to complete continuing education courses every two years. Licensed insurance agents can meet their continuing education requirements by attending seminars, taking classroom courses, or taking self-study courses.

3. During the period from August 1, 1995, through July 31, 1997, the Respondent was required to complete 28 hours of continuing education courses. /3 The required courses could be taken and completed at any time during that two-year period. At all times material, the Respondent has been aware of the continuing education requirements applicable to licensed insurance agents.

4. The Respondent resides in Key Largo, Florida, and has lived at the same address for at least 10 years. Miami, Florida, is about 60 miles from Key Largo. Key West is about 100 miles from Key Largo. During the period from August 1, 1995, through July 31, 1997, there were 11 continuing education courses offered in Key largo. During that same period there were 73 continuing education courses offered in Monroe County. During that same period there were approximately 3,000 continuing education courses offered in Dade County.

5. The Respondent waited until July 16, 1997, which was 15 days before the end of her two-year continuing education

   deadline, before taking any action to comply with the continuing education requirements. On that day she ordered two self-study courses from a course provider named Noble.

6. If an insurance agent chooses a self-study course to fulfill the continuing education requirements, the course is not considered to be completed until the agent has taken a monitored examination on the course material and has achieved a score of at least 70 percent. The Respondent finished her study of the course materials she bought from Noble by the end of July 1997, but she did not take and pass the examinations on those materials until the end of August 1997, which was three or four weeks past the end of her compliance deadline.

7. In July of 1997, the Respondent was nursing an infant child. Although Noble had a testing site in Miami, the Respondent did not want to go to Miami to take the examinations for her self-study courses, because a trip to Miami would interfere with nursing her child. The Respondent waited until the end of August, because by that time Noble had opened a testing site in Key Largo.

8. All insurance agents who failed to comply with the continuing education requirements for the period ending July 31, 1997, were sent a Preliminary Notice of Non-Compliance. All agents who did not respond to the Preliminary Notice of Non- Compliance were sent a Final Notice of Non-compliance. Both preliminary and final notices were sent to the Respondent.

9. The Department initiated disciplinary action against all insurance agents who were found to have failed to comply with the continuing education requirements. The Department offered each of the non-compliant agents an opportunity to settle the disciplinary actions by payment of an administrative fine in the amount of $250.00. Numerous insurance agents settled on those terms. In one case, such a disciplinary action was resolved by a stipulated six-month license suspension.

   CONCLUSIONS OF LAW

   
   

10. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of this proceeding. Section 120.57(1), Florida Statutes.

11. In a case of this nature, the Petitioner bears the burden of proving its case by clear and convincing evidence. See Ferris v. Turlington, 510 So. 2d 292 (Fla. 1987); Department of Banking and Finance v. Osborne Stern and Co., 670 So. 2d 932

    (Fla. 1996); Hoover v. Agency for Health Care Administration, 676 So. 2d 1380 (Fla. 3d DCA 1996).

12. Section 626.2815(2), Florida Statutes, states in pertinent part that "[t]he provisions of this section apply to persons licensed to engage in the sale of insurance in this state for all lines of insurance for which an examination is required for licensing." This section is inclusive of the licenses which the Respondent held in 1997.

13. Section 626.2815(3)(a), Florida Statutes, states in pertinent part that "[e]ach person subject to the provisions of this section must . . . complete a minimum of 28 hours of continuing education courses every two years in basic or

    higher-level courses prescribed by this section. "

    
    

    Respondent did not timely complete her continuing education requirement because she failed to complete the minimum 28 hours within the prescribed time period established by law.

14. Section 626.2815(3)(e), Florida Statutes, states in pertinent part that "[a]ny person who holds a license to solicit or sell life or health insurance and a license to solicit or sell property, casualty, surety, or surplus lines insurance must complete the continuing education requirements by completing courses in life or health insurance for one-half of the total hours required and courses in property, casualty, surety, or surplus lines insurance for one-half of the total hours required." Respondent was therefore required to complete 14 hours relating to life and health and 14 hours relating to property and casualty.

15. Rule 4-228.220(1), Florida Administrative Code, states in pertinent part that "[a] licensee shall be required to meet continuing education requirements by the end of their birth month after they have been licensed 24 months and every two years thereafter regardless of whether they hold an appointment."

16. Rule 4-228.080(10)(b), Florida Administrative Code, states in pertinent part that "[s]elf-study shall be completed by the licensee by achieving a grade of 70% or more on a monitored examination. . . ." Respondent's courses were not complete upon receipt of the self-study course materials or upon review of those materials. The courses were completed at the end of August 1997, when the Respondent took and passed the examination.

17. In this case the Respondent is charged, in somewhat vague and generic terms, 4/ with having failed to comply with the statutory and rule provisions mentioned in paragraphs 13, 14, 15, and 16, above. The failure to comply has been proved by clear and convincing evidence.

18. The Respondent has argued that she should be excused from timely compliance with the continuing education requirements because during the two-year compliance period she was pregnant for 9 months and was then nursing an infant during the last

    10 months of the compliance period. These circumstances may have made it inconvenient for the Respondent to attend to her continuing education requirements, but they are not circumstances that made it impracticable or impossible for the Respondent to meet the continuing education requirements. Such circumstances are not an excuse for failure to comply with the continuing education requirements.

19. The appropriate penalty in this case appears to be a suspension of the Respondent's license for a period of six months. 5/

RECOMMENDATION

On the basis of all of the foregoing, it is RECOMMENDED that the Department of Insurance issue a final order concluding that the Respondent is guilty of failing to comply with statutory and rule provisions regarding continuing education, and imposing a penalty consisting of a six-month suspension of the Respondent's license.

DONE AND ENTERED this 8th day of October, 1999, in Tallahassee, Leon County, Florida.

MICHAEL M. PARRISH

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 8th day of October, 1999.

ENDNOTES

1/ The parties stipulated that Key Largo is located in Monroe County, Florida, and that the Respondent did not take the test for her continuing education course until the end of August of 1997.

2/ The matters of which official recognition was taken are:

(a) the Respondent's responses to requests for admission; (b) the official mileage from Key Largo to Miami and from Key Largo to Key

West; (c) Sections 626.611, 626.621, and 626.2815, Florida

Statutes; and (d) Rules 4-228.030, 4-228.080, 4-228.220, and 4- 228.230, Florida Administrative Code.

3/ During the subject compliance period, the Respondent was required to complete 14 hours of continuing education related to Life and Health, and 14 hours of continuing education related to Property and Casualty.

4/ The charging document in this case is a document titled Final Notice of Non-Compliance. That document is less than an ideal model for the "administrative complaint" required by Section 120.60, Florida Statutes. If the Department intends to continue to take disciplinary action against insurance agents who fail to comply with continuing education requirements, it would be

well-advised to draft a model administrative complaint that provided the licensees with more information about the factual and legal basis for the Department's proposed action.

5/ A six-month suspension is consistent with the disposition of at least one other similar case. Further, a suspension is consistent with the text of the Final Notice of Non-Compliance, which advised that "this letter serves as official notice of the Department's intent to suspend all appointments you hold which are related to your non-compliant continuing education status." Although a modest administrative fine would appear to be an appropriate alternative penalty in cases of this nature, such a penalty is not an available option in this case, because the Final Notice of Non-Compliance fails to notify the Respondent that an administrative fine is a possible penalty in this case. See Williams v. Turlington, 498 So. 2d 468 (Fla. 3d DCA 1986).

COPIES FURNISHED:

Elenita Gomez, Esquire Robert C. Byerts, Esquire Department of Insurance Division of Legal Services 612 Larson Building

200 East Gaines Street Tallahassee, Florida 32399-0333

David Hutchison, Esquire Post Office Box 1262

Key Largo, Florida 33037-1262

Honorable Bill Nelson

State Treasurer and Insurance Commissioner The Capitol, Plaza Level 11

Tallahassee, Florida 32399-0300

Daniel Y. Sumner, General Counsel Department of Insurance

The Capitol, Lower Level 26 Tallahassee, Florida 32399-0300

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.

Docket for Case No: 98-005611

Orders for Case No: 98-005611