The Issue The issue in this case is whether, for the reasons alleged in the Administrative Complaint dated February 10, 1984, the Petitioner should revoke the Respondent's license and eligibility for licensure as an insurance agent or impose some lesser penalty authorized by statute.
Findings Of Fact Based on the testimony of the witnesses and the exhibits admitted into evidence, I make the following Findings of Fact: 1/ On June 16, 1982, the Respondent, Shelby Dewey Blackman, executed an Application for Qualification as Nonresident Life Agent, which application he thereafter caused to be filed with the Petitioner, Department of Insurance and Treasurer. In that application Mr. Blackman stated that his residence address and his business address in his state of residence were both "2549 New York Avenue, Pascagoula, Miss. 39567." (Pet. Ex. 1; Tr. 12-13) The Department of Insurance and Treasurer does not issue Nonresident Life Agent licenses to people who are in fact residents of the State of Florida. Such licenses are only issued to people who are nonresidents of this state. Applicants for Resident Life Agent licenses are required to take an examination prior to licensure. Applicants for Nonresident Life Agent licenses are not required to take an examination prior to licensure. The Department would not have issued a Nonresident Life Agent license to Mr. Blackman if the Department had known that Mr. Blackman was a Florida resident. (Tr. 14) As a result of the filing of the application described above, the Department issued to Mr. Blackman a license as a Nonresident Life and Health Agent for the American Sun Life Insurance Company, which was the only company he was authorized to write insurance for in the State of Florida. When Mr. Blackman received his license, the license listed the name of the the only company he was authorized to write insurance for in this state. Licensees who are authorized to represent more than one insurance company in this state receive a separate license for each company they are authorized to represent. Mr. Blackman had only the one license to represent one company. (Pet. Ex. 1 and 2; Tr. 14-18) At all times material to this case, Mr. Blackman was a resident of Santa Rosa County, Florida. Specifically, Mr. Blackman was a resident of Santa Rosa County, Florida, at the time he applied for and was issued a Nonresident Life and Health Agent license and at the time of writing the four insurance applications which are described hereinafter. (Pet. Ex. 3; Tr. 20-21, 53) Continental Bankers Life Insurance Company of the South does not currently hold, and has never held, a Certificate of Authority to write insurance in the State of Florida. In November of 1982 Continental Bankers Life Insurance Company of the South was licensed to write insurance in the State of Alabama and Mr. Blackman was authorized by Continental to write insurance for Continental in the State of Alabama. (Pat. Ex. 8; Tr. 24-25) During November of 1982, Mr. Blackman wrote four applications for health insurance policies to be issued by the Continental Bankers Life Insurance Company of the South. One was an application dated November 2, 1982 from Mr. Thomas J. Barrow. Another was an application dated November 4, 1982, from Mr. Jimmie R. Williams. The last two were applications dated November 12, 1982, from Mr. Henry E. Marshall and Mr. Ercy L. Henderson, respectively. All four of the applications were written and signed in Jay, Florida. No part of the transactions which culminated in the writing of the four applications took place in the State of Alabama. On three of the applications Mr. Blackman wrote that the application was written and signed in Brewton, Alabama, and on one of the applications Mr. Blackman wrote that the application was written and signed in Flomaton, Alabama. The statements that the applications were written and signed in Alabama were false statements that Mr. Blackman knew to be false statements. (Pet. Ex. 4, 5, 6, 7; Tr. 37-38, 42, 49, 53-54) The false statements written on the four applications described above were relied upon by the Continental Bankers Life Insurance Company of the South and were, therefore, material misrepresentations. If Mr. Blackman had truthfully written on the applications that they were written and signed in the State of Florida, Continental would not have issued policies on the basis of those four applications because Continental was not licensed to write insurance in the State of Florida. The MM-6 policy is an insurance policy that Continental markets in Alabama and the false statements on the applications which indicated that the policies were applied for and completed in Alabama induced Continental to issue the policies. (Tr. 25-27, 32, 34-35)
Recommendation For all of the reasons set forth above, and particularly because of Mr. Blackman's demonstrated disregard for the truth, I RECOMMEND that the Department of Insurance and Treasurer enter a Final Order revoking Mr. Blackman's license and eligibility to hold a license. DONE AND ORDERED this 31st day of July, 1984, at Tallahassee, Florida. MICHAEL M. PARRISH Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 904/488-9575 Filed with the Clerk of the Division of Administrative Hearings this 31st day of July, 1984.
The Issue Should discipline be imposed by Petitioner against Respondent's licenses as a life agent (2-16), life and health agent (2-18), and health agent (2-40), held pursuant to Chapter 626, Florida Statutes (2004)?
Findings Of Fact Respondent in accordance with Chapter 626, Florida Statutes (2005), currently holds licenses as a life agent (2- 16), life and health agent (2-18), and a health agent (2-40). On June 24, 2003, in an Administrative Complaint brought by Petitioner against Respondent, also under Case No. 64776-03-AG, accusations were made concerning violations of Chapter 626, Florida Statutes (2003). On October 4, 2004, the parties resolved the earlier case through a settlement stipulation for Consent Order. On October 20, 2004, the Consent Order was entered. In pertinent part the Consent Order stated: The Settlement Stipulation for Consent Order dated October 11, 2004, is hereby approved and fully incorporated herein by reference; * * * (c) Respondent agrees that he has a continuing obligation for claims, which may not have arisen or otherwise be known to the parties at the time of the execution of the Settlement Stipulation for Consent Order and this Consent Order Respondent shall be responsible for satisfying claims that were covered under the Plans sold by Respondent, up to the amount covered by such Plan, less any applicable deductibles or co-payments. Respondent may attempt to negotiate with the providers for compromised amounts, but any such compromise must result in the release of the consumer from any responsibility for the amounts that would have been covered under the terms of such Plan, less any applicable deductibles or co-payments; * * * (f) Within ninety (90) days following the issuance of this Consent Order, the Respondent shall complete the Section 626.2815(3)(a), Florida Statutes, continuing education requirement relative to unauthorized entities; * * * Within thirty (30) days of the issuance of this Consent Order, Respondent agrees to pay to the Department, a fine, in the amount of ONE THOUSAND AND 00/100 ($1,000.00) DOLLARS. Within ninety (90) days following the issuance of this Consent Order, Respondent shall satisfy any unpaid claims for persons insured under the Local 16 Plans he sold, including claims which may not have arisen or otherwise be known to the parties at the time of the execution of the Settlement Stipulation for Consent Order and this Consent Order. Respondent shall only be responsible, however, for satisfying claims that were covered under the Plans sold by Respondent, up to the amount covered by such Plan, less any applicable deductibles or co- payments. Respondent may attempt to negotiate with the providers for compromised amounts, but any such compromise must result in the release of the consumer from any responsibility for the amounts that would have been covered under the terms of such Plan, less any applicable deductibles or co- payments; Within one hundred (100) days following issuance of this Consent Order, the Respondent shall provide proof to the Department that the full amount of claims or losses under all contracts or health plans solicited or sold by Respondent on behalf of Local 16 have been paid or satisfied. Failure of the Respondent to comply with this paragraph shall constitute a material breach of this Consent Order, unless otherwise advised in writing by the Department; Respondent in the future shall comply with all the terms and conditions of this Consent Order; and, shall strictly adhere to all provisions of the Florida Insurance Code, Rules of the Department, and all other laws of the State of Florida. The Respondent shall give the Department full and immediate access to all books and records relating to the Respondent's insurance business, upon request; If, in the future, the Department has good cause to believe that the Respondent has violated any of the terms and conditions of this Consent Order, the Department may initiate an action to suspend or revoke the Respondent's license(s) or appointments, or it may seek to enforce the Consent Order in Circuit Court, or take any other action permitted by law; Respondent paid the $1,000.00 administrative fine required by the Consent Order, but the payment was 20 days late. Respondent completed the continuing education on unauthorized entities. He completed the course on June 3, 2005, beyond the deadline called for in the Consent Order by a number of months. Respondent took the course at Florida Community College in Jacksonville, Florida, an institution that he was familiar with. He took the course to be completed on June 3, 2005, because it was the earliest course available at that school. Respondent was unfamiliar with other schools who may have offered the course at a time that would meet the due date set forth in the Consent Order. Consistent with the expectations in the Consent Order, Petitioner's employees have reviewed their files to determine whether Respondent has satisfied unpaid insurance claims in relation to the insurance plan for Local 16. Those employees involved in that review are Kerry Edgill, a legal assistant in the Legal Division in charge of complaint settlements and Pamela White who works with the Division of Consumer Services as a senior management analyst. Neither employee found any evidence that Respondent had satisfied the unpaid insurance claims as called for in the Consent Order. In correspondence from Respondent to Petitioner's counsel in this case, dated December 6, 2004, there is no indication that the unpaid insurance claims have been satisfied. Respondent in his testimony explained the extent to which he had attempted to determine who had outstanding unpaid insurance claims. Respondent went to the location where Local 16 union members were employed. His contact with union members had to be outside the building proper. He spoke to several members at that time. This contact took place on June 1, 2005. Respondent identified the persons contacted as James, Luther, Gregory, and Michael. Michael's last name may have been Williams, as Respondent recalls. Of the persons Respondent spoke with on June 1, 2005, none of them had an unpaid insurance claim which needed to be satisfied. Respondent provided correspondence to a person or persons whose name(s) was or were not disclosed in the testimony. The June 6, 2005, correspondence was addressed to the Amalgamated Transit Union, in reference to insurance claims for Local 16. Respondent's Exhibit Numbered 17 is a copy of that correspondence. In the body of the correspondence it stated: June 6, 2005 Amalgamated Transit Union Local 1197 P.O. Box 43285 Jacksonville, FL 32203 Re: Claims for Local 16 To union members and trustees, This letter is to follow up me meeting members at the station on June 1, 2005 to discuss any issues or concerns that you may be or have had relating to the unpaid claims with Local 16 National Health Fund. Although, I feel I am not responsible for the issue I would gladly help assist with resolving any problems or concerns that you may have. Should any members have any correspondents that need immediate attention please forward them to me at: David Bright, P.O. Box 441963, Jacksonville, FL 32222. Should you need to speak to me I can be reached at 904-207-0141. Thanks for your cooperation in this long due matter! In relation to what Respondent refers to as accounts for Local 16 which he was servicing, that refers to insurance coverage, it involved a couple of hundred insureds. Respondent in his testimony acknowledged that union members had insurance claims that were unpaid.
Recommendation Upon consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That a final order be entered finding Respondent in violation of Sections 626.611(7) and (13), and 626.621(2) and (3), Florida Statutes (2004), finding no violation of Section 626.611(9), Florida Statutes (2004), or 626.9521, Florida Statutes (2004), and suspending Respondent's respective licenses as a life agent (2-16), life and health agent (2-18), and health agent (2-40), for a period of six (6) months. DONE AND ENTERED this 7th day of October, 2005, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS 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 7th day of October, 2005.
Findings Of Fact Parties Respondent, Department of Insurance (DOI) and Intervenor, Department of Banking and Finance (DBF) are state agencies charged with the regulation of insurance and banking activities, respectively. Great Northern Insured Annuity Corporation (GNA) is an insurance company and agency operating in Florida and elsewhere in space leased in financial institution lobbies, customer service areas and atriums. From its approximately eighty-four locations in Florida it markets annuities, securities and whole life insurance products. Approximately one-third of its 1992 sales of $130 million was in annuities. GNA's principal profits in Florida are derived from its sale of annuities, which it directly underwrites and services. First Nationwide Bank (FNB) leases space in its lobbies and other common areas to insurance agencies and companies, including Vista Financial Group, (Vista). In 1992 Vista sold approximately $13.5 million in annuities from the locations it leases from FNB. First Union Mortgage Corporation (FUMC) is a financial institution with "grandfathered" insurance activities pursuant to section 626.988(5), F.S. It has also been granted a certificate of authority by DOI as a Third Party Administrator pursuant to section 626.88, F.S. Florida Bankers Association (FBA) is a trade association of the banking industry in Florida. It represents its financial institution members. The Association of Banks in Insurance Inc. (ABI) is a trade association of financial institutions and insurance companies. The Florida Association of Life Underwriters (FALU) is a professional association of life, health and direct writer multi-line insurance agents with approximately 8,900 members. James Mitchell and Co. and its subsidiary, JMC Insurance Services Corporation (JMC) are California corporations involved in marketing financial products, including annuities in Florida. Florida Central Credit Union, Railroad and Industrial Federal Credit Union and GTE Federal Credit Union are state or federally chartered credit unions authorized to do business in Florida. Credit Union Services, Inc., a wholly owned subsidiary of GTE Federal Credit Union, sells insurance to credit union members. The Florida Association of Insurance Agents (FAIA) is a trade association representing independent insurance agents in Florida. Barnett Banks Trust Company, N.A. is a trustee for annuities issued by James Mitchell and Company. Barnett Banks Insurance, Inc. is a Florida licensed insurance company providing credit insurance of various types for credit extended by Barnett Banks throughout Florida. BTI Services, Inc. a subsidiary of Barnett, provides records administration services for insurers. Marketing One, Inc., Liberty Securities Corporation and Compulife, Inc. market annuities to existing and prospective customers of financial institutions. Those marketing activities are conducted from lobbies, atriums or other central areas of the premises of the financial institutions. The Financial Institutions Insurance Association is a California non- profit association of financial institutions and insurance companies with members in Florida who lease space to insurance agency tenants. California Federal Bank is a federal savings bank operating branches in the State of Florida and leasing space to a company selling insurance in that space in bank branch offices. The Statute Although other sections of statutes are cited as "law implemented" in proposed Chapter 4-223, its undeniable focus is section 626.988, F.S., as described in the first rule of the proposed chapter: 4-223.001 Purpose. The purpose of these rules is to implement the provisions of Section 626.988, Florida Statutes, and to ensure that customers of financial institutions conduct their business in an atmosphere free from direct or indirect coercion, unfair competition, and unfair or deceptive trade practices, and to implement those statutory provisions which prohibit insurance agents and solicitors who are directly or indirectly associated with, under contract with, or controlled by a financial institution from engaging in insurance agency activities as an employee agent, principal, or agent of a financial institution agency. These rules establish procedures and standards for insurance companies, agencies, agents and solicitors in their relationships and business arrangements with financial institutions. Embodied in Florida's insurance code, a code described as more lengthy than the New Testament, Section 626.988 F.S. enacted in 1974, ". . . generally prohibits banking institutions from engaging in insurance agency activities. . . ." Florida Association of Insurance Agents, Inc. v. Board of Governors, 591 F.2d 334 (U.S. 5th Cir. 1979). The prohibition is accomplished indirectly by forbidding licensed insurance agents or solicitors from engaging in insurance agency activities under certain relationships with financial institutions. There are exceptions to the blanket prohibition, including an amendment in 1990 to permit state chartered banks to sell annuities in the event that federal law permits federal banks to sell annuities. After almost twenty years of attempted enforcement, DOI has described section 626.988, F.S. as "a vague statute with imprecise standards". (Notice of proposed rule, Florida Administrative Weekly, June 26, 1992) The Rules DOI's experience with interpretation and enforcement of Section 626.988, F.S. commenced in earnest in the early 1980's, when insurance companies began to market annuities in the lobbies or public access areas of financial institutions. Many of these companies consulted with the department and obtained guidance as to the applicability of the law to their varied circumstances. In 1985, American Pioneer Life Insurance Company, through its counsel, Edward Kutter, Esquire, inquired of Commissioner Gunter concerning the effect of the law on its operations. American Pioneer Life Insurance Company was a wholly owned subsidiary of American Pioneer Savings Bank. Donald Dowdell, General Counsel of the department, responded by letter dated November 18, 1985. He analyzed the relationships among the insurer, the financial institution, and the insurance agents and determined that there was no significant probability of the financial institution exercising control over the agents: . . . In view of the fact that American Pioneer Savings Bank is the ultimate parent of American Pioneer Life Insurance Company, the specific issue which must be resolved in responding to your inquiry is whether an independent agent appointed by American Pioneer Life is directly or indirectly associated with, or retained, controlled, or employed by American Pioneer Savings Bank. Absent such a relationship, Section 626.988 does not prevent American Pioneer Life and its agents from marketing insurance in this state. . . . These corporate relationships in and of themselves do not create a prohibited relationship between American Pioneer Savings Bank and independent insurance agents appointed by American Pioneer Life. . . . It is recognized that as the corporate parent, American Pioneer Savings Bank may influence or control various corporate activities of its subsidiaries which would not entail control of the solicitation, effectuation and servicing of coverage by insurance agents. If, in fact, American Pioneer Savings Bank does not directly or indirectly control the conduct of insurance activities by American Pioneer Life agents but, instead, the agents sell insurance free of influence from the financial institution, the prohibitions of the statute are inapplicable. (GNA Exhibit No. 8) (emphasis added) Thus, in 1985, the department limited the prohibitions of section 626.988, F.S. to the financial institution's control of, and authority over, an agent's insurance activities. By 1986, other aspects of an association became a concern of the department. Letters responding to inquiries outlined requirements that leased space and insurance sales literature be physically or visually separated from the functions of the financial institution. (GNA Exhibits No. 10, 13 and 16) As a result of the body of opinions being circulated in the form of incipient policy, the department proposed rules implementing section 626.988. These proposed rules were later withdrawn before adoption, but the department continued to use them as guidelines. During this period, DOI received a handful of complaints, mostly from agents. Douglas Shropshire, director of Agent and Agency Services during the relevant period, testified that he could not recall a single consumer complaint with respect to financial institutions engaging in the distribution of insurance products. Gail Connell, identified by Mr. Shropshire as "the Department's person most intimately familiar with field investigation of .988 issues" (Tr. at 760), agreed. (FUMC Exhibit No. 35, at 184-85 See also. FUMC Exhibit No. 36 at 347-50, 353) In 1991, in anticipation of the rule-making mandate of section 120.535, the department reviewed its guidelines. As a part of that review, representatives of the agents' associations, FALU, FAIA and others, were consulted as to the desirability of the rules. In January, 1992, DOI published proposed rules that were substantially similar to the guidelines. Donald Dowdell stated that the proposed rules published at that time represented the department's determination of a reasonable interpretation of the statute, adding, "[T]he line was drawn with the realization of what was happening in the real world today. We could have -- I think the statute prohibits an association, and as I indicated yesterday, if we had wanted to be Draconian about it and make life easier on ourselves, we could have attempted to prohibit any kind of association and see how that would have flown." (FUMC Exhibit No. 36 at 260-261) The rules published in January of 1992 were withdrawn in order to permit the department to correct some perceived inadequacies in the economic impact statement. The rules were presented at a workshop and were republished in June, 1992. The rules were virtually the same as those published in January. A public hearing was held July 12, 1992. On October 6, 1992, DOI published a Notice of Change which materially altered Rules 4-223.003, .004, and .005. According to the Notice of Change, the change was in response to comments received at the public hearing held July 12. More specifically, the amendments were the result of the department's adoption of FALU's position in its petition challenging the June version of the rules. The amendments most significantly provided a definition of "associated" or "associate" and forbade insurance agents from occupying space virtually anywhere within the confines of a financial institution. Mr. Shropshire drafted the amendment to Rules 4-223.003-.005. His source for the definition of "associate" was Webster's Dictionary. Mr. Shropshire testified that the modified proposal resulted from "explosive changes" in the number of banks involved in insurance in this state (Tr. at 793) and information which had come to his knowledge which indicated a need for a more restrictive rule. The two sources of information regarding insurance activities in Florida identified by Mr. Shropshire were the report prepared by investigator Ernest Ulrich in support of the economic impact statement and an ongoing investigation and prosecution of JMC for its marketing of annuities. Both sources predate or were contemporaneous to the June publication of the rules. Mr. Shropshire's reason for the October change was the anticipated difficulty DOI faced in enforcing its rules as originally published. He stated, "So it was getting plain to us that we were going to have to very vigorously and closely and labor-intensively enforce the rule, if it was passed as it was promulgated in June of '92." (tr. at 808) As described by Mr. Shropshire and others, the agency was concerned that insurance activities in financial institutions were not being conducted behind partitions, or even behind planters or other visual separations; and that bank agents were making referrals, taking telephone messages, and setting appointments for insurance agents who covered multiple bank branches on a "circuit-rider" system. Banks leasing space to agents also commonly paid bank employees a bonus for making appointments and referrals of customers to the agents. DOI determined that these leasing arrangements established a strong connection between the bank and the agent, in effect wrapping the insurance program in the bank's colors and presenting it as another bank product. This, to DOI, justified the previously characterized "Draconian" measures. The banks' and other witnesses freely described the economic advantage to a financial institution of having insurance services available at the same location for its customers. Additional amendments to the proposed rules were published in December 1992. Those amendments acknowledge or track the statutory exceptions to the section 626.988(2), F.S. prohibitions. The rules therefore do not apply to mortgage insurance business, credit unions, banks located in cities having a population of less than 5,000, and the sale of annuities when national banks have been authorized to sell such annuities. During the course of the formal hearing, the agency proposed a final change to the rules at issue, clarifying that Chapter 4-223 does not apply to credit life and disability insurance and credit unemployment insurance. (American Banking Insurance Co. Exhibit No. 1) The Economic Impact Dr. Tim Lynch, Director for the Center for Economic Policy Analysis for Florida State University, conducted surveys, collected data and analyzed the economic impact of the June 1992 version of the proposed rules. He prepared the economic impact statement for DOI. Dr. Lynch was consulted by the department about the October changes to the proposed rules and did additional analysis on the impact of the proposed changes. The economic impact statement prepared for the June publication was not amended, but Dr. Lynch's observations are found in his notes, or what he terms a "work in progress". He discussed those observations with department staff and considers the economic impact of prohibiting leases to be at least in the $ millions. The agency did not republish an economic impact statement after the October changes, but plainly considered the impact of those changes as articulated by its consultant, Dr. Lynch. Prohibiting the sale of annuities on bank premises would have a devastating effect on companies engaged in that activity. Banks, also, would be affected, as they recognize a substantial benefit of providing their customers the convenience of an in-house service. Although annuities are defined in Florida law as "life insurance" (See Section 364.602(1), F.S.) they are generally considered investments for future security rather than a cushion against loss. On March 20, 1990, the Office of the Comptroller of the Currency (OCC) issued a formal approval letter stating, among other things, that under controlling Federal banking law, annuities are primarily financial investment instruments that national banks are permitted and authorized to sell. (GNA Exhibit No. 41) A follow-up letter to J. Thomas Caldwell as representative of the Florida Bankers Association specifically concluded that federally chartered banks in Florida were authorized to sell annuities. (GNA Exhibit No. 42) The OCC conclusion with regard to the authority of national banks was upheld in the Variable Annuity Life Insurance Co. v. Robert Clarke, et. al., (VALIC) on November 22, 1991, by the U.S. District Court for the Southern District of Texas, Civil Action No. H-91-1016, 786 F. Supp. 639. The case is pending on appeal before the U.S. Court of Appeals for the Fifth Circuit. (Variable Annuity Life Insurance Company v. Clarke, Case No. 92-2010) In the meantime, the OCC continues to issue opinion letters consistent with its earlier opinion. (See 5/10/93 letter filed as supplemental authority on 6/18/93) National banks are presently selling annuities, and the impact of the October 1992 absolute prohibitions is nullified as to annuity products by the December 1992 amendments addressed in paragraph 30, above.
Findings Of Fact At all times relevant to this proceeding, Respondent, Carl Austin Jorgensen, was licensed by the Petitioner, Department of Insurance, as an ordinary-combination life including disability insurance agent and a solicitor for property, casualty, surety and miscellaneous lines insurance. He has held a license since 1956. During the time in which the alleged violations occurred, Respondent was employed by Simons and Rose Agency, an insurance firm located in Coconut Grove, Florida. Respondent wished to establish an insurance agency with his wife, Maren Jorgensen, who was licensed as a general lines agent. He discussed this with her on several occasions in 1977, but she would not agree. Her consent was necessary since agency applications must be submitted by a licensed general lines agent. On or about August 10, 1977, Respondent prepared and submitted an application for agency appointment to the Florida Joint Underwriters Association (FJUA) . The Association is the successor to the automobile assigned risk plan in Florida and was established to provide insurance coverage to those automobile drivers who are otherwise unable to obtain voluntary insurance coverage. The application was submitted under the name of All Lines Insurance Agency, 222 NorthEast 20th Street, Miami, Florida, and bore the name and signature of Maren Jorgensen, the Respondent's wife (Petitioner's Exhibit 2). The application was actually signed by Respondent, who had forged his wife's name (Petitioner's Exhibit 7). As a licensed general lines agent, Maren Jorgensen held a 2-20 license. This license was required in order to be qualified to sell insurance through the FJUA. Respondent held no such license, and as such, was unqualified to write policies. Upon receipt of the application, the FJUA reviewed it, and having determined that Maren Jorgensen held an appropriate license, assigned Nationwide Mutual Fire Insurance Company to write policies for All Lines' customers. Maren Jorgensen was unaware of the application being filed, and did not consent to the use of her name. At no time did she participate in or otherwise supervise the running of the business. Rather, Respondent himself operated the agency until early 1978, when it ceased to do business. On or about December 23, 1977, Respondent solicited and sold two automobile insurance policies to Lowell McLean, III, a long-time acquaintance. These policies were issued by Nationwide Mutual Fire Insurance Company and were numbered J58721 and J57869 (Petitioner's Exhibits 3 and 5) The applications bore the name and signature of his wife as producing agent. However, the applications were prepared and submitted by Respondent without her knowledge and consent. The Florida Department of Law Enforcement (FDLE) verified that Respondent had forged her signature (Petitioner's Exhibit 7) On or about November 26, 1977, Respondent solicited and sold an automobile insurance policy to Michael J. Halen. This policy was issued by Nationwide Mutual Fire Insurance Company and was numbered J56852 (Petitioner's Exhibit 4). It bore the name and signature of Respondent's wife as producing agent. However, the application was prepared and submitted without the knowledge and consent of Maren Jorgensen. Again, the FDLE verified that Respondent had actually signed her name (Petitioner's Exhibit 7). Two relatively small commission checks were sent by Nationwide to Maren Jorgensen as producing agent for the sale of the three policies. The checks were mailed to the address of All Lines, without the knowledge of the wife. Respondent appropriated one of the checks for his own personal use. His wife accidentally discovered the other in her husband's wallet and then cashed it herself. Respondent sold only three policies involving two customers during his association with All Lines. None of the three transactions resulted in harm or financial loss to either the customers or the insurance company. During the period when the aforesaid events occurred, Respondent and his wife, although living together, were experiencing marital difficulties. In fact, his wife characterized this time-frame as being a "rather stormy period". They are now separated. Respondent acknowledged the charges in the complaint, but attributed these indiscretions to his desire to rehabilitate the marriage by cultivating a successful insurance business with his wife.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Respondent Carl Austin Jorgensen's ordinary-combination life including disability insurance license be suspended for a period of eighteen (18) months from the date of the final order entered in this proceeding for those violations of Chapter 626, Florida Statutes (1977) described herein above. DONE and ENTERED this 22nd day of April, 1981, in Tallahassee, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 22nd day of April, 1981. COPIES FURNISHED: Deborah A. Getzoff, Esquire Department of Insurance 428-A Larson Building Tallahassee, Florida 32301 William A. Meadows Jr., Esquire 6101 SW 76th Street South Miami, Florida 33143
The Issue Whether Respondent failed to maintain general liability insurance coverage as required by Section 493.6110, Florida Statutes, and, if so, what penalty should be imposed on his Class "A" Private Investigative Agency License and his Class "C" Private Investigator License.
Findings Of Fact Respondent currently holds a Class “A” Private Investigative Agency License, having been issued License No. A96- 00005 pursuant to Chapter 493, Florida Statutes, effective June 15, 1996, and expiring on June 15, 1998. Respondent currently holds a Class “C” Private Investigator License No. C94-00709, issued pursuant to Chapter 493, Florida Statutes, effective January 23, 1997, and expiring on December 7, 1998. As of June 28, 1996, Respondent had general liability insurance coverage relative to his Class “A” license through Scottsdale Insurance Company, West Palm Beach, Florida. This insurance policy expired on June 28, 1997. Respondent currently has insurance coverage relative to his Class “A” license through Costanza Insurance Agency, Inc., Dallas, Texas. The effective period of this insurance coverage is from August 5, 1997, through August 5, 1998. Respondent did not file Form LC2E018, Certificate of Insurance, with the Department as required to evidence that his agency, Jon Bowdoin and Associates, had insurance coverage in force during the period beginning June 29, 1997, through August 4, 1997. Respondent had no insurance coverage relative to his Class “A” license for the period June 29, 1997, through August 4, 1997. Respondent’s Class “A” Private Investigative Agency License was not in an inactive status during the period June 29, 1997, through August 4, 1997.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Department enter a final order (1) finding that Respondent committed the violation alleged in the Administrative Complaint filed herein; (2) imposing an administrative fine of $700.00; and (3) placing Respondent's Class "A" Private Investigative Agency License on one year non- reporting probation. DONE AND ENTERED this 16th day of June, 1998, in Tallahassee, Leon County, Florida. CAROLYN S. HOLIFIELD 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 Filed with the Clerk of the Division of Administrative Hearings this 16th day of June, 1998. COPIES FURNISHED: Michelle Guy Assistant General Counsel Department of State, Division of Licensing The Capitol, Mail Station Four Tallahassee, Florida 32399-0250 Jon Bowdoin, Owner Jon Bowin and Associates 3323 U. S. Highway 19 Suite 901 Palm Harbor, Florida 34684 Don Bell, General Counsel Department of State The Capitol, Plaza Level 02 Tallahassee, Florida 32399-0250 Honorable Sandra B. Mortham Secretary of State The Capitol Tallahassee, Florida 32399-0250
The Issue Whether Petitioner is entitled to an award of attorney's fees and costs, associated with defending DOAH Case No. 13- 3820PL, pursuant to section 57.111, Florida Statutes (2014), as a small business and a prevailing party.
Findings Of Fact DFS is the state agency charged with the licensing and regulation of insurance agents in Florida and is responsible for administrating the disciplinary provisions of chapter 626, pursuant to sections 20.121(2)(g) and (h), Florida Statutes. At all times material to this case, de la Paz was a licensed general lines insurance agent in Florida. De la Paz also is a director and officer of the MDLPA, which she has co- owned with her daughter, Jenny Mondaca Toledo (Mondaca), since 2000. On October 15, 2003, the Office of Insurance Regulation issued a cease and desist order (Order) against IWSF and NAM from conducting insurance-related activities in Florida, including but not limited to, "transacting any new or renewal insurance business in this state, and from collecting any premiums from Florida insureds." The sale of insurance products by unauthorized entities (UEs) poses a danger to Florida consumers, because UEs are not vetted by the Office of Insurance Regulation, their financial stability is questionable, they may not have sufficient reserves to pay claims for consumers, and they do not participate in the Guarantee Fund which protects consumers should a company become insolvent. DFS has undertaken a variety of media campaigns in an effort to warn licensed agents about the dangers and consequences of providing insurance products through UEs. DFS regularly conducts investigations against agents for selling UE products. Generally, consumers will not know the quality of alleged insurance providers until the consumer makes a claim against their policy. For this reason, DFS cautions agents to verify the status of insurance providers prior to selling a policy. Agents can access the website for the Office of Insurance Regulation or call to inquire about the status of a particular company. The website has been available for approximately 17 years. DFS tried to warn Florida insurance agents that IWSF was an UE; however, IWSF was the most prevalent UE selling in Florida, and approximately 584 consumers were provided with IWSF policies sold by various agents. In an effort to stop the sale of insurance products through IWSF and NAM, DFS obtained a list of Florida customers from the Canadian bankruptcy receiver of IWSF. DFS' Bureau of Investigations sent a survey to these consumers and through the survey, it was determined that Carlos Guzman (Guzman) and Jorge Saez (Saez) purchased IWSF watercraft insurance from MDLPA in April 2009. Field Insurance Regional Administrator Lidia Azcue (Azcue) and Investigator Marlene Suarez (Suarez) opened an investigation regarding this transaction. Azcue and Suarez went to MDLPA on December 4 and 5, 2012. The alleged violation being investigated was that the agency sold unauthorized products, and the purpose was to see if any others were being sold. They did not inform the staff at MDLPA of the reason for the investigation. De la Paz was not present nor was she interviewed during these visits. Azcue and Suarez asked for and received the binder book of MDLPA on a thumb drive. Mondaca was present on the first day of the investigation and was described by Azcue as cooperative. Azcue also requested and received files for other consumers who purchased marine insurance products from MDLPA. As a result of the investigation, and prior to the filing of the Administrative Complaint, DFS obtained the following information and documentation regarding MDLPA and the transaction between MDLPA, Saez, and Guzman: De la Paz and her daughter, Mondaca (referred to on the Bank of America signature card as "Jenny M. Toledo, President") had signature authority for the MDLPA corporate bank account at Bank of America; An IWSF quote printed April 14, 2009, for the vessel owned by Saenz (sic) and Guzman, which was faxed to MDLPA by IWSF to "Odalis" (referring to Odaylis Chiullan (Chiullan), an employee of MDLPA) which references de la Paz and MDLPA as the contact; A fax dated May 6, 2009, from Chiullan to IWSF asking IWSF to bind coverage for Guzman and Saez effective May 6, 2009; Undated handwritten notes on a "File Action Log" form regarding "Jorge Sahel Saez" in the handwriting of Chiullan; A fax dated May 6, 2009, from IWSF to "Odaylis" at MDLPA; An unsigned and undated "Insurance Premium Financing Disclosure Form" to be signed by Guzman and Saez, which was obtained by Chiullan from the premium financing company. In correspondence prior to the issuance of the Administrative Complaint, de la Paz advised DFS that it was Chiullan who had the form signed by Guzman and Saez and transmitted the signed forms and check for the down payment to the finance company; A receipt prepared by Chiullan dated May 6, 2009, acknowledging delivery of $280.00 as a "down payment" by Guzman and Saez for financing of a policy with NAM; The premium finance agreement between the finance company and Guzman and Saez prepared by the finance company and sent to Chiullan. The agreement is signed by Guzman and by de la Paz on behalf of MDLPA as "broker or agent"; Check number 1138 dated May 6, 2009, and drawn on the bank account of Guzman payable to the finance company in the amount of $370.00. This check was delivered to Chiullan and forwarded by her to the finance company along with the signed, original documents for the financing of the balance of the insurance premiums; A fax dated May 12, 2009, from NAM to Odaylis at MDLPA, requesting confirmation of the payment plan arranged with Saez and Guzman; IWSF declaration page for Guzman and Saez; IWSF renewal certificate for Guzman and Saez for the period of May 6, 2010, through May 5, 2011, signed by Guzman on May 4, 2010; and Correspondence from IWSF to de la Paz at MDLPA dated May 13, 2010, returning two checks, one signed by Mondaca and one signed by de la Paz, for reissuance in the name of IWSF. No interviews were conducted as part of the investigation by DFS of de la Paz, Mondaca, Chiullan, Guzman, or Saez. After the field investigation was concluded, the investigative file was forwarded on January 16, 2013, to Veronica Jackson, Government Analyst I, who reviewed the file for legal sufficiency. On May 24, 2013, a letter from Kathy Spencer, Stipulation Program Coordinator with the Office of the Chief Financial Officer, Jeff Atwater (Atwater), was sent to de la Paz alleging that she "aided and abetted an unauthorized entity in the sale of insurance." No further details were provided, nor were any Florida Statutes cited. Attached to the correspondence was a proposed settlement stipulation for consent order which offered de la Paz a $5,000.00 penalty and a one-year period of probation in lieu of having a formal administrative complaint filed against her. On June 13, 2013, de la Paz responded with a letter to Atwater explaining that at no time had de la Paz or anyone at MDLPA received notification that IWSF and NAM were not authorized to sell insurance products in Florida. De la Paz asserted that Chiullan, who held a 220 license and only worked for MDLPA for a few weeks, was the individual who handled the transaction with Guzman and Saez. De la Paz pointed out that to be charged with violation of section 626.734, de la Paz, as the licensed agent and owner of the insurance agency, cannot be subject to disciplinary proceedings due to Chiullan's placing this one policy with IWSF, because she was not aware of such act and the facts constituting a violation of the insurance code. Additionally, de la Paz pointed out that section 626.910 provides a person "aiding an unauthorized insurer" shall pay a civil penalty of not more than $1000.00 for each non-willful violation. De la Paz emphasized that she personally "did absolutely nothing to violate the code, let alone commit a willful violation of the code." For this reason, she could not sign the stipulation admitting that she committed a willful violation. De la Paz's letter was forwarded to Jackson who asked de la Paz for documentation supporting de la Paz's position. De la Paz corresponded with Jackson on June 29 and July 2, 2013. In this correspondence, in addition to once again supplying the requested documentation, de la Paz reiterated her lack of knowledge of IWSF as a UE and her lack of involvement in the Guzman/Saez transaction. On July 2, 2013, Azcue contacted de la Paz to invite her to come to DFS' office and review the investigative file. This meeting was not mandatory. According to de la Paz's credible testimony, she asked to bring her attorney and was told she could not. De la Paz declined to attend the meeting. On August 26, 2013, after negotiations with de la Paz were unsuccessful, DFS filed a one-count Administrative Complaint against de la Paz, alleging that on May 6, 2009, Guzman and Saez purchased a policy for watercraft insurance from MDLPA. De la Paz was charged with a violation of section 626.611, "Knowingly aiding, assisting, procuring, advising, or abetting any person in violation of or to violate a provision of the insurance code or any order or rule of the department, commission, or office." De la Paz was also charged with a violation of section 626.734, which provides that any general lines agent who is an officer, director, or stockholder of an incorporated general lines insurance agency shall remain personally and fully liable and accountable for any wrongful acts, misconduct, or violations of any provision of the code committed by such licensee by any person under his or her direct supervision and control while acting on behalf of the corporation. A final hearing on the Administrative Complaint was held on December 4, 2013, and January 7, 2014. A Recommended Order was entered by the undersigned on March 28, 2014, which found that DFS failed to prove, by clear and convincing evidence, that de la Paz knowingly aided, assisted, procured, advised, or abetted two UEs when Chiullan sold what was purported to be watercraft insurance in the spring of 2009 to Saez and Guzman. DFS admits that de la Paz is a "small business party" and was a "prevailing party" for purposes of the Florida Equal Access to Justice Act, section 57.111. There is no dispute that de la Paz's attorney's fees for defending the underlying action in the amount of $29,700.00 and costs in the amount of $1,265.39 are reasonable. De la Paz's additional cost for the final hearing Transcript in the amount of $831.75 is also reasonable.
The Issue The issue in this case is whether Respondent committed the offenses alleged by the Department of Financial Services in the Administrative Complaint dated May 27, 2009, and, if so, what penalty should be imposed.
Findings Of Fact Petitioner, the Department of Financial Services ("Petitioner" or "the Department") has regulatory responsibility for Chapter 626, Florida Statutes (2009), the insurance licensing procedures law. Respondent, Eileen P. Suarez ("Respondent" or "Suarez"), is a licensed general lines agent transacting in property and casualty insurance, under license number E129078. She operated and was the agent in charge of the Suarez Insurance Agency, Inc. ("Agency"), in Hialeah, Florida. The Agency held a valid state license from 7/21/2006 to 7/27/2009. The Department filed a three-count Administrative Complaint against Respondent alleging that she violated various provisions of Chapter 626, Florida Statutes. COUNT I John Vila is the president of Vila Home Group, Inc., a trucking company that is in the business of hauling sand, soil, and gravel. In April 2005, he purchased a dump truck and, at the suggestion of the dealer, contacted Suarez for insurance. Suarez sold Vila two insurance policies, for the period April 29, 2005 to April 29, 2006, one with AequiCap Insurance Company ("AequiCap") and the other with the Underwriters at Lloyds, London ("Lloyds"). The AequiCap Policy was a commercial liability insurance policy. The Lloyds Policy was a commercial automobile physical damage insurance policy. In March 2006, Vila gave Suarez a check in the amount of $10,876.41, made payable to the Agency to renew the AequiCap and Lloyds policies, for the period April 29, 2006 to April 29, 2007. The AequiCap policy quote was approximately $5,350.00. The Lloyds policy quote was approximately $5,500.00. The check was deposited in the Agency's trust account, but the Lloyds policy was allowed to expire on April 29, 2006, and was not renewed until October 26, 2006, creating a six-month gap in commercial automobile physical damage insurance coverage for Vila. When it was renewed, the Lloyds Policy cost $5,712.03. Vila's AequiCap policy expired on April 29, 2006, and was not renewed because Suarez failed to pay MAI Risk Management, AequiCap's managing general agent. The funds were not returned to Vila. While the March 2006 quotes were pending, the registered driver of the truck, Andres Vila, was involved in an accident and was at fault for hitting a wire. Rather than risk an increase in the pending insurance quotes, Vila paid Bellsouth $2,390.36 in damages. COUNT II On or about October 26, 2006, Suarez provided Vila a Certificate of Liability showing that the truck was insured with AequiCap, under policy number TC012695, and with Lloyds, under policy number R641440/0251, for the period April 29, 2006 to April 29, 2007. Vila was not insured under AequiCap policy number TC012695 from April 29, 2006 to April 29, 2007. The Certificate of Liability was a false document that Suarez created on her computer, printed, and gave to Vila. COUNT III Shelly, Middlebrooks & O'Leary, Inc. ("Shelly Middlebrooks") is a licensed insurance agency, located in Jacksonville, that acts as a general agent for multiple insurance companies. Suarez collected insufficient funds to include the premiums that were intended to be forwarded to Shelley Middlebrooks for policies to insure the following trucking companies: All Nations Logistics, LLC (Policy Number 486865); Jose Veiga, d/b/a JJ Freightways (Policy Number 486885); Gary Castle/Diamond Mine (Policy Number 74APN338354); and Nics Oil, Inc. (Policy Number 74APN401617). For each of the four companies, she requested and received binders for insurance from Shelly Middlebrooks, followed by invoices for the premiums that were to have been paid within ten days of the date the invoices were received. In each instance, Suarez did not pay Shelly Middlebrooks, which cancelled the policies for non-payment of the premium. It also obtained a default judgment in the Circuit Court in and for Duval County, Florida, that requires Suarez to pay it the outstanding balances due for the four policies and a $25 insufficient funds check fee, for a total of $8,335.60, which she has been unable to pay. Instead of paying for insurance, Suarez used most of the funds she collected to pay for various other corporate expenses for the same trucking companies, including state and federal government filings for intrastate or interstate travel that were prerequisites to their becoming insurable. Suarez expected to collect the additional funds needed for insurance later, but the clients, the owners of the trucking companies, did not pay her. Suarez admits that she failed her clients in 2006, after her father's death in February 2006. She realized the Vila errors and tried to correct them in October. The Agency is now closed. Suarez's husband has been unemployed for over a year, and their home is in foreclosure. She is receiving social security disability payments and has insufficient funds to file for bankruptcy.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered by the Department of Financial Services: Finding Respondent guilty of violating Subsections 626.611(7), (8) and (10); Subsection 626.561(1); and Subsections 626.621(2) and (6), Florida Statutes, as charged in Count I of the Administrative Complaint; Finding Respondent guilty of violating Subsections 626.611(7) and (8); Subsection 626.621(6); and Subsection 626.9541 (1)(e)1., Florida Statutes, as charged in Count II of the Administrative Complaint; Finding Respondent guilty of violating Subsections 626.611(7), (8) and (10); Subsection 626.561(1); and Subsections 626.621(2) and (6), Florida Statutes, as charged in Count III of the Amended Complaint; Revoking Respondent's licenses and appointments issued or granted under or pursuant to the Florida Insurance Code; Ordering Respondent to make restitution to John Vila in the amount of $5,164.38; and Ordering Respondent to make restitution to Shelly Middlebrooks & O'Leary in the amount of $8,335.60. DONE AND ENTERED this 16th day of February, 2010, in Tallahassee, Leon County, Florida. S ELEANOR M. HUNTER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 16th day of February, 2010.
The Issue The issue for determination is whether Respondent made or is accountable for misrepresentations that were made in the course of sales of automobile personal injury protection insurance policies to various consumers; thereby committing violations of Chapter 626, Florida Statutes, sufficient to subject Respondent's licensure as general lines insurance agent to disciplinary action.
Findings Of Fact Respondent is Lori Ann Thomas, currently licensed and eligible for licensure by Petitioner as a general lines insurance agent. Respondent has held such licensure status since March 12, 1985. At all times pertinent to these proceedings, Respondent was the general lines agent of record for Mr. Auto Insurance of Clearwater Inc. (Mr. Auto), located in Clearwater, Florida. On March 4, 1987, Kelly John O'Brien went to Mr. Auto after being notified by state officials that his failure to maintain required automobile insurance would result in the loss of his driver's license. He made a number of telephone calls to ascertain the amount of money necessary to purchase the minimum amount of insurance required by law at the least expensive price. Of the quotes O'Brien obtained, Respondent's price was the cheapest. O'Brien received a receipt from Respondent's agency in return for his payment of $82. The total premium charge for the personal injury protection (PIP) insurance purchased by him was $52. As part of his purchase of PIP coverage, O'Brien was charged $30 for membership in the Colonial Touring Association, a motor club providing towing coverage and accidental death insurance benefits to members. O'Brien was not asked whether he wanted to purchase a membership in the Colonial Touring Association and would, if he had known extra cost was involved, have rejected the membership. During the course of the insurance purchase at Respondent's agency, O'Brien signed and initialled an application form for PIP coverage with B.I.G. Underwriters, Inc., a subsidiary corporation of Bankers Insurance Group, Inc., which discloses the $52 premium cost for PIP coverage. In addition to signing and initialling the application form, O'Brien also signed and initialled a form supplied by Respondent indicating his rejection of bodily injury and property damage liability coverage; election of no-fault deductibility in the amount of $2,000; rejection of uninsured motorist coverage; rejection of basic property protection and collision insurance; and election to purchase the accidental death insurance benefit and motor club towing coverage package. Further, at the bottom of this form he signed a statement that he had read and understood all provisions of the form. It is found that O'Brien signed the form in order to acquire the PIP coverage which he sought to purchase and did not voluntarily purchase the accidental death benefit and motor club towing coverage. On May 28, 1987, Susan Weatherwax went to the offices of Mr. Auto to acquire the basic minimum required insurance coverage for registration of her automobile. A previous telephone survey by her indicated that Mr. Auto offered the cheapest price for the desired coverage. She was told by the salesman at the agency that the cost for PIP coverage would be $65. She received a receipt for this amount. While at Mr. Auto, Weatherwax signed and initialled an application form for PIP coverage with B.I.G. Underwriters, Inc., a subsidiary corporation of Bankers Insurance Group, Inc., which discloses the correct premium cost for the PIP coverage purchased by her to be $35. Weatherwax also signed and initialled a form supplied by Respondent indicating rejection by her of bodily injury and property damage liability coverage; election of no-fault deductibility in the amount of $2,000; rejection of uninsured motorist coverage; rejection of basic property protection and collision insurance; and election to purchase the accidental death insurance benefit and motor club towing coverage package. Further, at the bottom of this form she signed a statement that she had read and understood all provisions of the form. It is found that Weatherwax was charged $30 for membership in the Colonial Touring Association, the accidental death insurance benefit and motor club towing coverage package, which she did not request to purchase. She signed Respondent's form in order to acquire the PIP coverage which she desired and did not voluntarily purchase the accidental death benefit and motor club towing coverage. On April 22, 1987, Bruce Campbell went to the offices of Mr. Auto to purchase the legally required PIP minimum coverage necessary to get tags for his automobile. He paid $82 and received a receipt for that amount. He also signed and initialled an application form for PIP coverage with B.I.G. Underwriters, Inc., a subsidiary corporation of Bankers Insurance Group, Inc., which discloses the correct premium cost for the PIP coverage purchased to be $52. He also signed and initialled a form supplied by Respondent indicating rejection of bodily injury and property damage liability coverage; election of no-fault deductibility in the amount of $2,000; rejection of uninsured motorist coverage; rejection of basic property protection and collision insurance; and election to purchase the accidental death insurance benefit and motor club towing coverage package otherwise known as membership in the Colonial Touring Association. Further, at the bottom of this form he signed a statement that he had read and understood all provisions of the form. Campbell's testimony establishes that he purchased the motor club benefit package because he understood such purchase was required in order to receive the PIP coverage. It is found that he did not request to purchase the $30 membership in the Colonial Touring Association. He signed the form in order to acquire the PIP coverage which he desired and did not voluntarily purchase the accidental death benefit and motor club towing coverage. On a subsequent visit to Mr. Auto, Campbell purchased PIP coverage without the auto club membership, but only after specifically stating he did not want the coverage and waiting until the salesperson sought and received confirmation that such a sale could be made. Patrick Golik went to Mr. Auto on January 23, 1987, to purchase PIP and liability insurance on his automobile. His testimony fails to establish that he was sold membership in the Colonial Touring Association without his informed consent. He did, however, profess dissatisfaction with the membership's benefits. On May 5, 1987, Richard Davis went to Mr. Auto to buy just the basic amount of required insurance for a second automobile to "make it legal." He was informed that the premium cost for PIP coverage would be $65. He paid this amount and received a receipt. He also signed and initialled an application form for PIP coverage with B.I.G. Underwriters, Inc., a subsidiary corporation of Bankers Insurance Group, Inc., which discloses the correct premium cost for the PIP coverage purchased to be $35. He also signed and initialled a form supplied by Respondent indicating rejection of bodily injury and property damage liability coverage; election of no-fault deductibility in the amount of $2,000; rejection of uninsured motorist coverage; rejection of basic property protection and collision insurance; and election to purchase the accidental death insurance benefit and motor club towing coverage package otherwise known as membership in the Colonial Touring Association. Further, at the bottom of this form he signed a statement that he had read and understood all provisions of the form. Davis' testimony establishes that he did not request to purchase the $30 membership in the Colonial Touring Association. He signed the form in order to acquire the PIP coverage which he desired and did not voluntarily purchase the accidental death benefit and motor club towing coverage. On May 2, 1987, Jeri Exner went to Mr. Auto to acquire PIP coverage. He was told the premium would be $65. He paid this amount and received a receipt. He also signed and initialled an application form for PIP coverage with B.I.G. Underwriters, Inc., a subsidiary corporation of Bankers Insurance Group, Inc., which discloses the correct premium cost for the PIP coverage purchased to be $35. He also signed and initialled a form supplied by Respondent indicating rejection of bodily injury and property damage liability coverage; election of no-fault deductibility in the amount of $2,000; rejection of uninsured motorist coverage; rejection of basic property protection and collision insurance; and election to purchase the accidental death insurance benefit and motor club towing coverage package otherwise known as membership in the Colonial Touring Association. Further, at the bottom of this form he signed a statement that he had read and understood all provisions of the form. Exner's testimony establishes that he did not request to purchase the $30 membership in the Colonial Touring Association. He signed the form, but did not read it, in order to acquire the PIP coverage which he desired and did not voluntarily purchase the accidental death benefit and motor club towing coverage. The proof establishes that a general business practice prevailed at Mr. Auto, a corporation duly organized under the laws of the State of Florida, whereby consumers requesting to purchase PIP insurance were quoted a price including a membership in the Colonial Touring Association. Such memberships, while including a life insurance benefit, are not insurance policies.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered suspending Respondent's license and eligibility for licensure as an insurance agent for a period of one year. DONE AND ENTERED this 19th day of July, 1989, in Tallahassee, Leon County, Florida. DON W. DAVIS Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 19th day of July, 1989. APPENDIX The following constitutes my specific rulings, in accordance with Section 120.59, Florida Statutes, on findings of fact submitted by the parties. Petitioner's Proposed Findings. 1-15. Addressed. 16.-20. Accepted in part, but rejected as to the deception implied in proposed finding 19 on the basis that a review of Golik's testimony shows he recalled being questioned about the purchase. He was dissatisfied with the company. 21.-32. Addressed. Respondent's Proposed Findings. Respondent's proposed findings of fact consisted of two unnumbered paragraphs. The first paragraph is addressed in substance. The second paragraph is rejected as not supported by the weight of the evidence. COPIES FURNISHED: Robert V. Elias, Esq. Office of Legal Services 412 Larson Building Tallahassee, FL 32399-0300 Thomas F. Woods, Esq. 1709-D Mahan Drive Tallahassee, FL 32308 Honorable Tom Gallagher State Treasurer and Insurance Commissioner The Capitol Tallahassee, FL 32399-0300 Don Dowdell, Esq. The Capitol, Plaza Level Tallahassee, FL 32399-0300
The Issue The issue in this case is whether the license of Allen Franklin Meredith (Respondent) should be disciplined by the Department of Insurance and Treasurer (Petitioner) for allegedly allowing others to use his general lines insurance agent license, and to sign his name to insurance policy applications while Respondent was not present, as more particularly set forth in the Administrative Complaint issued herein on or about October 12, 1989.
Findings Of Fact At all times material hereto, Respondent has been licensed, and eligible for licensure, in the State of Florida as a life and health insurance agent, health insurance agent, and a general lines insurance agent. During April, 1989, Respondent approached Gordon Rowan, owner of Gordon Rowan Real Estate and Insurance in Winter Haven, Florida, to inquire whether Rowan would assist Respondent in obtaining a renewal of his general lines insurance agent license. Respondent was residing with his family in Georgia at the time, and told Rowan that his Florida general lines agent license was about to expire, and he needed to get licensed with a Florida company in order to apply for renewal. Rowan agreed to pay for Respondent's renewal fee, and for licensing him with a Florida Company doing business through Rowan's agency. On or about April 30, 1987, Rowan applied to National Insurance Associates for licensure on behalf of Respondent, and paid the applicable license fee. On or about May 20, 1987, Respondent was licensed with National Insurance Associates as a general lines insurance agent, and his Florida general lines license was renewed. Respondent admitted in an affidavit executed on November 16, 1987, that he did authorize Rowan to use his general lines license from the beginning of May to the end of June, 1987, while he was still living in Georgia. This authorization was in exchange for Rowan's assistance in obtaining Respondent's licensure with National Insurance Association, and renewal of his Florida license. However, at hearing Respondent testified that he never authorized Rowan to "use" his license, only to "place" his license with Rowan's agency. Rowan testified that Respondent had, in fact, told him that he could use his license and write business under it, including signing Respondent's name to policy applications, even though Respondent was not in the office and did not participate in these transactions. Rowan's assistant, May Satava, was present when Rowan and Respondent discussed their arrangement, and confirmed Rowan's testimony. Based upon the demeanor of the witnesses, as well as the affidavit executed by the Respondent shortly after the events involved in this matter, it is found that Respondent's uncorroborated testimony at hearing is not credible, while that of Rowan and Satava is found to be credible and consistent with statements made to Luis Rivera, the Petitioner's investigator, in October, 1987. Respondent did tell Rowan that he could use his general lines license to write business, and to sign his name to applications in exchange for Rowan's assistance in obtaining the renewal of his Florida general lines agent license. Working under Rowan's control and supervision, Satava did sign Respondent's name to approximately 48 policy applications from May through July, 1987, while Respondent actually signed only 3 additional policy applications during this period. Thus, the vast majority of business written under Respondent's license during this time was actually completed by Satava, an unlicensed person working under the control and supervision of Rowan, without any involvement of Respondent, pursuant to his agreement with Rowan that Rowan could use his license. Respondent did receive a commission payment in the amount of $200 from Rowan for June and July commissions. This represented Rowan's estimate of a reasonable payment to Respondent for the use of his license during this time when Satava signed Respondent's name to approximately 48 policy applications.
Recommendation Based upon the foregoing, it is recommended that Petitioner enter a Final Order suspending Respondent's general lines agent license, and eligibility for licensure, for a period of six months. DONE AND ENTERED this 9th Florida. day of March, 1990 in Tallahassee, DONALD D. CONN Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 Filed with the Clerk of the Division of Administrative Hearings this 9th day of March, 1990. APPENDIX Rulings on the Petitioner's Proposed Findings of Fact: 1-2. Adopted in Finding 1. Adopted in Finding 2. Adopted in Finding 3. 5-6. Adopted in Finding 6. Adopted in Finding 7. Adopted in Finding 8. Respondent did not file Proposed Findings of Fact. COPIES FURNISHED: Gordon T. Nicol, Esquire 412 Larson Building Tallahassee, FL 32399-0300 Allen Franklin Meredith 140 Flamingo Drive Auburndale, FL 33823 Don Dowdell, Esquire General Counsel Department of Insurance The Capitol, Plaza Level Tallahassee, FL 32399-0300 Hon. Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, FL 32399-0300
