vs. ) Case No. 00-0300
LANNIE J. GREGORY, )
Respondent. )
On April 24, 2000, a formal administrative hearing in this case was held by videoconference in Tampa and Tallahassee, Florida, before William F. Quattlebaum, Administrative Law Judge, Division of Administrative Hearings.
For Respondent: Lannie J. Gregory, pro se
The issue in the case is whether the Respondent, an insurance agent, has complied with applicable continuing education requirements.
By Final Notice of Non-Compliance dated August 17, 1999, the Department of Insurance (Department) notified Lannie J. Gregory (Respondent) that he was not in compliance with continuing education requirements applicable to his licensure as an insurance agent. The Respondent requested a formal hearing. The Department forwarded the request for hearing to the Division of Administrative Hearings, which scheduled and conducted the proceeding.
During the hearing, the Petitioner presented the testimony of one witness and had Exhibits numbered 1-5 admitted into evidence. The Respondent testified on his own behalf. No transcript of the hearing was filed. The parties filed Proposed Recommended Orders.
The Respondent is a licensed life insurance and variable annuity insurance agent, holding license number A104253, and has held the license at all times material to this case.
The Respondent is required to meet applicable continuing education requirements set forth by statute.
Based on the type of license held by the Respondent, he must complete 28 hours of continuing education instruction during each reporting period. The instruction must be related to the type of insurance the Respondent is authorized to sell.
During the reporting period from December 1, 1995 through November 30, 1997, the Respondent completed 28 hours of continuing education instruction; however, only 21 hours of the instruction are creditable to life and variable annuity insurance agents for purposes of complying with the continuing education requirement.
Because seven of the Respondent’s 28 hours are not related to his licensure status, they are not applicable to his continuing education requirement; accordingly, the Respondent had a deficit of seven hours for the relevant reporting period.
One of the courses completed by the Respondent was "LTC Strategies and Laws" (Course ID 30180) on November 25, 1997. Credit for this three-hour course is available only to licensed health insurance agents. The Respondent is not a licensed health insurance agent, and is not entitled to credit for this course.
Another of the courses completed by the Respondent was "Senior Citizen Insurance" (Course ID 4301) on November 25, 1997. The credit for this eight-hour course is divided; four hours of credit is applicable to life insurance agents and four hours is applicable to health insurance agents. The Respondent is entitled only to the four hours of credit available to life insurance agents.
By Preliminary Notice of Non-Compliance dated June 15, 1999, the Respondent received notice that, according to the Department’s review of the records, he had not completed the
continuing education requirement. The Notice included a number of resolution alternatives, ranging from the licensee’s correction of the records by providing additional information, to resolving the matter by payment of a fine and completion of the hours, to a licensee-initiated license termination.
The Department sent the Preliminary Notice to all addresses of record on file for the Respondent.
The Respondent did not respond to the June 15 Preliminary Notice of Non-Compliance.
On August 17, 1997, the Department issued a Final Notice of Non-Compliance, again advising that the continuing education requirement was unmet, again including options for resolving the deficiency, and advising of the right to request a formal administrative hearing.
The Department sent the Final Notice by certified mail to the licensee’s permanent address of record.
In response to the Final Notice, the Respondent requested a formal administrative hearing. The Respondent also sent additional information to the Department apparently unaware that some of the completed course hours were inapplicable to his licensure.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to and subject matter of this proceeding. Section 120.57(1), Florida Statutes.
The Department of Insurance is responsible for licensure and regulation of insurance agents in Florida. Chapter 626, Florida Statutes.
The Department has the burden of proving by clear and convincing evidence the allegations against the Respondent. Ferris v. Turlington, 510 So. 2d 292 (Fla. 1987). In this case, the burden has been met.
Section 626.2815, Florida Statutes, sets forth the continuing education requirements applicable to the Respondent in this case. Section 626.2815(3)(a), Florida Statutes, provides in relevant part as follows:
(3)(a) Each person subject to the provisions of this section must complete a minimum of 28 hours of continuing education courses every 2 years in basic or higher-level courses prescribed by this section or in other courses approved by the department.
Rule 4-228.220(1), Florida Administrative Code, establishes the reporting period applicable to this case and provides as follows:
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. A person applying for and receiving a license in their birth month will be required to provide documentation of continuing education credits earned as of their birth month two years later.
Rule 4-228.100(8), Florida Administrative Code, establishes the requirement that continuing education credits be
relevant to the type of insurance an agent is authorized to sell. The rule provides as follows:
(8) Except as otherwise stated in this rule, credit must be earned in the line of business for which the licensee is licensed. Customer representatives and general lines, industrial fire, auto physical damage, and surplus lines agents must earn credits in property and casualty courses related to the authority of their license to satisfy the total hours of credit required for their license. Life; health; industrial life; and life, health and variable agents, must earn credits in a life or health course related to the authority of their license to satisfy the total hours of credit required for their license. Adjusters who handle workers' compensation claims must earn credits in courses on workers' compensation subjects. Title agents must earn credits in courses on title subjects.
While the responsibility of meeting continuing education requirements rests clearly on a licensee, the Respondent correctly notes that neither the Preliminary nor the Final Notice of Non-Compliance specifically identifies the applicable deficiency which results in the non-compliance. The Respondent stated that prior to the hearing he was not aware of the actual deficiency, and testified that had he better understood the situation, he would not have requested a formal hearing.
Although the Department indicated that attempts to communicate with the Respondent about the specifics of the deficiency had occurred, the Respondent’s suggestion that additional information specifically identify continuing education deficiencies be provided in the Notices is well-taken.
Specifically identifying a licensee’s credit deficiency could potentially result in a more timely resolution of disputes and a reduction in utilization of agency resources, when cases are resolved prior to formal hearing.
In this case, the Respondent failed to meet applicable continuing education requirements because seven hours of the completed courses were inapplicable to the type of license the Respondent holds.
Section 626.611, Florida Statutes, sets forth grounds for compulsory suspension of an agent’s license, and provides as follows:
The department shall deny an application for, suspend, revoke, or refuse to renew or continue the license or appointment of any applicant, agent, title agency, solicitor, adjuster, customer representative, service representative, or managing general agent, and it shall suspend or revoke the eligibility to hold a license or appointment of any such person, if it finds that as to the applicant, licensee, or appointee any one or more of the following applicable grounds exist:
Lack of one or more of the qualifications for the license or appointment as specified in this code.
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(13) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code.
The evidence establishes that the Respondent has violated Section 626.611(1), Florida Statutes, in that completion of continuing education requirements is a condition of licensure under the Florida Insurance Code.
The evidence fails to establish that the Respondent has violated Section 626.611(13), Florida Statutes. The evidence fails to establish that the Respondent willfully failed to comply with a rule of the Department or a provision of the Insurance Code. There is no evidence that the Respondent’s failure to comply with the continuing education requirements was "willful." The Respondent completed the appropriate number of course hours, apparently inadvertently completing seven credit hours for which he is not entitled to credit. There is no evidence that the Respondent obtained any advantage or benefit by his error.
Rule 4-231.080, Florida Administrative Code, sets forth the penalties for violations of Section 626.611, Florida Statutes. Violation of Section 626.611(1), Florida Statutes, requires surrender of license. As set forth below, consideration of mitigating circumstances warrants reduction of the penalty.
Section 626.621, Florida Statutes, sets forth grounds for discretionary suspension of an agent’s license, provides as follows:
The department may, in its discretion, deny an application for, suspend, revoke, or refuse to renew or continue the license or appointment of any applicant, agent, solicitor, adjuster, customer representative, service representative, or managing general agent, and it may suspend or revoke the eligibility to hold a license or appointment of any such person, if it finds that as to the applicant, licensee, or appointee any one or more of the following applicable grounds exist under circumstances for which such denial, suspension, revocation, or refusal is not mandatory under s. 626.611:
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Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or appointment.
Violation of any lawful order or rule of the department.
By failing to comply with the continuing education requirements applicable to his license, Respondent has violated Section 626.621(2) and (3), Florida Statutes.
Rule 4-231.090, Florida Administrative Code, sets forth discretionary penalties for violations of Section 626.621, Florida Statutes. Violation of Section 626.621(2), Florida Statutes, suggests a three-month suspension of license. Violation of Section 626.621(3), Florida Statutes, suggests a three-month suspension of license.
Rule 4-231.160, Florida Administrative Code, sets forth aggravating and mitigating factors to be considered in determining appropriate penalties, and provides as follows:
The Department shall consider the following aggravating and mitigating factors and apply them to the total penalty in reaching the final penalty assessed against a licensee under this rule chapter. After consideration and application of these factors, the Department shall, if warranted by the Department's consideration of the factors, either decrease or increase the penalty to any penalty authorized by law.
For penalties other than those assessed under rule 4-231.150:
willfulness of licensee's conduct;
degree of actual injury to victim;
degree of potential injury to victim;
age or capacity of victim;
timely restitution;
motivation of agent;
financial gain or loss to agent;
cooperation with the Department;
vicarious or personal responsibility;
related criminal charge; disposition;
existence of secondary violations in counts;
previous disciplinary orders or prior warning by the Department; and
other relevant factors.
The Department suggests that the appropriate penalty in this case is a suspension of the Respondent’s licensure for a period of six months, and cites the case of Department of Insurance v. Hutchison (DOAH Case No. 98-5611, entered October 8, 1999) in support of the suggested penalty.
In the Hutchison case, an agent attempted to comply with the continuing education requirements by completion of self- study courses, credit for which required the agent to travel from her residence in Key Largo to a testing center in Miami. At the time, the agent was nursing an infant child and apparently thought that the required travel was inconvenient. When the agent eventually traveled to Miami to complete the testing, the reporting period had concluded and the credit was unavailable.
In the instant case, the Respondent completed a sufficient number of instructional hours, but seven of the hours were inapplicable to his licensure. There is no evidence that the failure of the Respondent to complete the total of 28 creditable hours was due to any lack of effort or intention on his part. There is no evidence that the Respondent profited by completing the wrong coursework. There is no evidence that any
person was harmed by the Respondent’s error. There is no evidence of any previous disciplinary action taken by the Department against the Respondent. The evidence in this case warrants mitigation of the penalty.
Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Insurance enter a final order suspending the licensure of Lannie J. Gregory for not less than one month or until Lannie J. Gregory completes seven additional continuing education hours appropriate to his licensure, whichever is later, and imposing a fine of $1,000.
DONE AND ENTERED this 24th day of May, 2000, in Tallahassee, Leon County, Florida.
WILLIAM F. QUATTLEBAUM
Filed with the Clerk of the Division of Administrative Hearings this 24th day of May, 2000.
Lannie J. Gregory 2680 West Lake Road
Daniel Y. Sumner, General Counsel Department of Insurance and Treasurer The Capitol, Lower Level 26 Tallahassee, Florida 32399-0300
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 must be filed with the agency that will issue the final order in this case.
