The Issue Whether the Respondent committed the acts alleged in the Amended Administrative Complaint filed by the Petitioner on October 6, 1997, and, if so, the penalty which should be imposed.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: The Department of Insurance is the state agency responsible for regulating the business of insurance in the State of Florida. Section 624.307, Florida Statutes. This power extends to the licensing and discipline of insurance agents. Sections 626.291, .611, and .621, Florida Statutes. Howard Irvin Vogel ("Respondent") is, and was at all times material to this action, licensed as a general lines agent (2-20) and a health insurance agent (2-40); Respondent is also currently licensed as a Florida Property and Casualty Joint Underwriting Association representative (0-17). Respondent is, and was at the times material to this action, the president of Federal Auto Ins., Inc., 1/ ("Federal Insurance"), an incorporated general lines insurance agency located in Lake Worth, Florida. He is, and was at the times material to this action, the only officer of the corporation who is a licensed insurance agent. In 1993, 1994, 1995, and 1996, Respondent was a director of the corporation and its designated primary agent. Respondent is, and was at the times material to this action, also the only licensed insurance agent who has the authority to sign checks drawn on the Federal Insurance trust account. At the times material to this action, Federal Insurance employed at least two licensed insurance agents in addition to the Respondent. The Respondent regularly worked full-time in the Federal Insurance office during 1993, 1994, and 1995, and he was aware of the way in which the agents he employed sold insurance. All monies received by the agents were turned over to the agency, and the Respondent approved all refunds and signed all refund checks. The Respondent ran the day-to-day operations of the insurance agency and supervised the agents who worked there. At the times material to this action, it was the practice at Federal Insurance to impose a service charge for the preparation of certificates of insurance 2/ if a customer indicated he or she would need certificates prepared throughout the year. It was also the practice not to charge customers for the preparation of the first three certificates, but the agents employed there had the option, depending on the person and on the amount of the premium, of charging $5 for each certificate prepared in excess of the three free ones or of charging a flat fee of $100 per year. The charge was imposed to cover the costs of preparing the certificates. The agents employed by Federal Insurance were expected to explain the charge to the customer and to make it clear that the $100 was an additional charge and not part of the insurance premium. The fees received for the preparation of certificates of insurance were deposited in Federal Insurance's trust account. Some insurance agencies do not charge for the preparation of certificates of insurance on behalf of their customers. At the times material to this action, Federal Insurance sold automobile towing coverage provided by L.N.V., Inc., a Florida corporation whose directors since its incorporation in 1987 have been Howard and Alicia Vogel. L.N.V., Inc., reimburses its members for the expense of towing an insured vehicle if an accident occurs during the period the customer's automobile insurance policy is in effect. Federal Insurance had, at the times material to this action, a separate application for the towing coverage, which applicants for the coverage were required to sign. The agents employed by Federal Insurance were expected to explain the nature of the coverage and to make it clear to the customer that the charge for the towing coverage was separate from the premium charged for the underlying automobile insurance policy. The membership fees received for the towing coverage were deposited into a separate account for L.N.V., Inc. The Respondent is the only licensed insurance agent authorized to sign checks on this account. Michael Clark On December 19, 1993, Michael J. Clark went to the office of Federal Insurance to purchase a commercial general liability insurance policy and to renew his commercial automobile insurance policy. He met with Lee Vogel, who was a licensed general lines agent employed by Federal Insurance. Lee Vogel quoted Mr. Clark an annual premium of $776 for the renewal of his commercial automobile insurance policy for a vehicle used in his business, Eastern Electric. Mr. Clark applied for the policy, which was written by the Granada Insurance Company ("Granada"); $776 was the correct premium for the coverage Mr. Clark requested. Mr. Clark paid Federal Insurance a down payment of $330 and signed a Premium Finance Agreement and Disclosure Statement in order to obtain financing for the balance of the premium. When Mr. Clark signed the premium finance agreement, the portion identified as the Federal Truth-in-Lending Disclosure Statement had not been completed by Lee Vogel, so the form did not reflect the amount of the down payment. Mr. Clark and Lee Vogel used a worksheet when they were discussing the coverage and the cost of the policy. The worksheet Lee Vogel prepared during these discussions shows that he added $100 to the $776 premium for the commercial automobile insurance policy and stated a total of $876 on the worksheet. Mr. Clark signed the worksheet on which the $100 charge is shown, and he apparently did not question at that time the purpose of the additional $100 charge. Several weeks after he purchased the commercial automobile insurance policy, Mr. Clark received the documents and payment book from the premium finance company. These documents reflected that he had been credited with a down payment of only $230 rather than the $330 down payment Mr. Clark thought he had made on the policy. At the same time he purchased the commercial automobile insurance policy, Mr. Clark purchased a commercial general liability insurance policy. Lee Vogel quoted Mr. Clark a premium of $281 for a policy which would be written by the American Surety and Casualty Insurance Company ("American Surety"). Mr. Clark applied for this policy and paid Federal Insurance $381 as payment in full for the general liability policy. The worksheet prepared by Lee Vogel shows a $100 charge added to the $281 premium quoted to Mr. Clark. Although Mr. Clark claims that Lee Vogel did not explain the $100 charge to him, Mr. Clark did not question Lee Vogel about the additional $100 charge. He signed the worksheet and paid Federal Insurance $381 for the general liability coverage even though he was quoted $281 as the premium for the coverage. Lee Vogel added the $100 charge to the $776 and $281 premiums for the automobile and general liability policies as a service charge to cover the costs of preparing any certificates of insurance Mr. Clark might request during the policy year. According to Lee Vogel, customers are not charged for the preparation of certificates for commercial automobile insurance policies because certificates of insurance are not usually prepared for such policies. If they are, it is in conjunction with certificates of insurance prepared to confirm commercial general liability coverage. At the time he purchased the policy, Mr. Clark requested that four certificates of insurance be prepared, and, on December 20, 1993, Howard Vogel signed four certificates of insurance verifying that Eastern Electric had general liability coverage with American Surety. During the 1993-94 policy year, Federal Insurance prepared a total of seventeen certificates of insurance on behalf of Eastern Electric, which certified that Eastern Electric had general liability coverage with American Surety. Five of the seventeen certificates of insurance confirmed both that Eastern Electric had general liability coverage with American Surety and that Eastern Electric had automobile insurance coverage with Granada Insurance Company. No separate certificates of insurance were prepared by Federal Insurance for the commercial automobile insurance policy written by Granada Insurance Company. Mr. Clark testified that he was not informed of the $100 service charge added to the premiums for the commercial automobile insurance policy and the commercial general liability insurance policy. He was in a hurry when he purchased these policies, and, when Lee Vogel gave him two or three papers to sign, he signed the papers without really reading them. Except for his signature appearing on several of the certificates of insurance prepared by Federal Insurance for Eastern Electric, the Respondent's only direct involvement with Mr. Clark's case was a letter the Respondent wrote to the Department, dated June 20, 1994, in which he complained about the way in which the investigation of Mr. Clark's complaint was being handled. Cheryl Lee Andrews On February 23, 1994, Cheryl Andrews purchased a commercial general liability insurance policy for her husband's lawn care business, Tropic Green Lawn Care, through Federal Insurance. After having spoken with him on the telephone, Ms. Andrews met with Bryan Sanders, a licensed general lines insurance agent employed by Federal Insurance, who quoted Ms. Andrews a premium of $673 for a policy written by American Surety. The wholesale broker in this transaction, with whom Federal Insurance had a contract, was Amelia Underwriters, Inc. Ms. Andrews made a down payment of $271 on the policy, and she was given a receipt which indicated that she had paid a $271 payment on a "GL" policy with "Amelia." When she paid the down payment on the policy, Ms. Andrews also signed a Premium Finance Agreement to finance the remainder of the premium through Del Rio Discount Corp. When Ms. Andrews signed the premium finance agreement, the portion identified as the Federal Truth-in-Lending Disclosure Statement had not been completed by Mr. Sanders; the premium finance agreement contained only the number of payments, the amount of each payment, and the date the first payment was due. Soon after, Ms. Andrews spoke with the Respondent on the telephone and requested a copy of the premium finance agreement with a completed disclosure statement. The Respondent sent her a copy of the agreement by facsimile transmittal, but it was not legible. Ms. Andrews telephoned the Respondent again and requested that he send her a copy by mail. When she did not receive another copy from Federal Insurance, she contacted American Surety, which contacted Amelia Underwriters, and the underwriters provided a completed copy of the Premium Finance Agreement. The down payment identified in the agreement was $171. On the day she purchased the insurance policy, Mr. Sanders asked if she wanted any certificates of insurance. At that time, Ms. Andrews did not know what this was, and Mr. Sanders told her it was proof of insurance. She asked that he prepare one certificate of insurance for Tropic Green Lawn Care on February 23, 1994. A second certificate of insurance was prepared by Federal Insurance for Tropic Green Lawn Care on March 28, 1994. Mr. Sanders did not discuss with Ms. Andrews at any time a charge for preparation of certificates of insurance. When she questioned the Respondent during a telephone conversation about the additional $100 she had paid Federal Insurance, he told her that it was a charge for certificates of insurance and other service charges and that, if she wanted any information, she should ask in writing. She then wrote a letter to the Respondent, dated June 10, 1994, requesting a breakdown of these charges, but she did not receive a response. In a letter dated July 26, 1996, written to the Department, Mr. Sanders confirmed that Federal Insurance charged $100 Ms. Andrews for preparation of certificates of insurance. Tropic Green was reimbursed $100 by Federal Insurance by a check drawn on the Federal Insurance trust account and dated January 8, 1996. Virginia Davidson On August 17, 1994, Virginia Davidson applied for personal automobile insurance through Federal Insurance. She dealt with a woman whose name she does not remember and who has not been identified in these proceedings. The policy was to cover a 1985 Chrysler, and she told the woman that she wanted insurance only for a short time because she intended to sell the car in the near future. At the time of this transaction, Ms. Davidson was in her late sixties. Ms. Davidson was told she needed to buy a one-year policy, and she recalled being quoted a price of $386 for an automobile insurance policy written by Armor Insurance Company ("Armor"). She paid the $386 by check dated August 17, 1994, and made payable to Federal Insurance; she was given a receipt that indicated that she had paid in full the premium on the Armor automobile insurance policy for one year. In fact, the premium for this policy was initially computed as $281 on the Brokerage Auto Application form. Although Ms. Davidson signed the application form on which this quote appeared, her signature appeared only on the reverse of the application form, while the quote appeared on the front. Ms. Davidson does not recall that anyone on August 17, 1994, explained that the $386 quoted to her included a separate $100 charge for towing coverage to be provided by L.N.V., Inc. At the time she purchased the insurance policy, Ms. Davidson was a member of AAA and would not have knowingly purchased towing coverage. Ms. Davidson's signature appears on a separate application form which clearly displayed the terms "Towing Coverage" and "LNV Corp." The "membership fee" for this coverage was shown on the form as $100. Ms. Davidson was asked to sign a number of documents when she applied for the automobile insurance policy, and she does not recall signing the application form for towing coverage. In a notice from Armor dated September 16, 1994, Ms. Davidson was notified that she owed an additional premium of $116 on her automobile insurance policy. The additional premium was due as a result of Armor's investigation of Ms. Davidson's driving history. In a letter to Armor dated October 11, 1994, Ms. Davidson requested that the policy be cancelled and that she receive a refund of unearned premium. Armor sent Federal Insurance a check dated October 31, 1994, in the amount of $163.70, representing the unearned premium on Ms. Davidson's automobile insurance policy. Mr. Vogel signed a check to Ms. Davidson on the Federal Insurance trust account, dated November 11, 1994, for $163.70. Ms. Davidson did not receive this check, and a replacement check was prepared, dated December 5, 1994. Ms. Davidson does not recall receiving this check, and neither of these checks has cleared Federal Insurance's account. The Respondent refused to issue another replacement check unless Ms. Davidson waited six months for the checks to clear the bank or paid Federal Insurance the $25.00 fee charged by the bank to stop payment on the replacement check. During December 1994, the Respondent recalculated the amount of the refund owing Ms. Davidson, including for the first time the agency's unearned commission and a pro rata refund of the $100 fee for the towing coverage. The Respondent issued a check to Ms. Davidson, drawn on the Federal Insurance trust account and dated December 26, 1994, in the amount of $117.20. The check specified that it was for "cancellation in full" of Ms. Davidson's automobile insurance policy. Ms. Davidson did not cash this check because she disputed that it was the full amount of the refund owed to her. Armor subsequently issued a check to Ms. Davidson in the amount of $184.80, which included the $163.70 and an additional amount of unearned premium which Armor had neglected to include in its calculations. Ms. Davidson does not recall receiving this check. All of the checks were sent to Ms. Davidson at her correct address in West Palm Beach, Florida. The Respondent was involved in the transaction involving Ms. Davidson only after she cancelled her automobile insurance policy. The Respondent signed the refund checks issued in her name, and, after Ms. Davidson filed a complaint with the Department, he responded to the Department's inquiry regarding the refund due to her. After having reviewed the files of Mr. Clark, Ms. Andrews, and Ms. Davidson, the Respondent was satisfied with the way the agents employed by Federal Insurance transacted business with these individuals. Summary The evidence is uncontroverted that the employees of Federal Insurance are supervised on a daily basis by and are under the direct control of the Respondent. The evidence presented by the Department is not sufficient to establish with the requisite degree of certainty that Michael Clark was unaware that he was charged $100 in addition to the premiums quoted on the commercial automobile insurance policy and commercial general liability insurance policy he purchased through Federal Insurance. Although he may not have been told the purpose of the extra charge, Mr. Clark was quoted premiums of $776 and $281, respectively, for the insurance policies. The worksheet he signed clearly shows that $100 was added to each of these premiums; in fact, Mr. Clark paid $381 as payment in full for the commercial general liability insurance policy when he knew that the premium for the policy was $281. On the other hand, the evidence presented is sufficient to establish that Lee Vogel deducted a $100 service charge for certificates of insurance from Mr. Clark's down payment of $330 on the commercial automobile insurance policy even though this charge was not imposed on commercial automobile insurance policies because separate certificates of insurance are not prepared for such coverage. The evidence presented by the Department is sufficient to establish that Bryan Sanders did not inform Cheryl Andrews of the $100 service charge added to the premium for the general liability insurance policy she purchased for Tropic Green Lawn Care and to establish that Ms. Andrews could reasonably believe that the entire down payment of $271 would be applied to the insurance premium. However, the evidence is uncontroverted that, when she spoke to the Respondent by telephone, he told her that the charge was for preparation of certificates of insurance and other services. The evidence presented by the Department is sufficient to establish that, even though she signed an application form for towing coverage to be provided by L.N.V. Corp., Ms. Davidson was not told of the purpose of the application, the nature of the coverage, or the $100 fee for the coverage. In fact, the receipt for $386 that she received from Federal Insurance did not make any reference at all to the towing coverage or to L.N.V. Corp. The evidence presented by the Department is, however, not sufficient to establish that the Respondent refused to refund the monies owing to Ms. Davidson; under the circumstances presented, it was not unreasonable for Federal Insurance to refuse to issue a second replacement check. The evidence presented by the Department is sufficient to establish that the Respondent instituted the practice of charging a $100 service fee for the preparation of certificates of insurance for commercial general liability insurance purchased through Federal Insurance. The evidence presented by the Department is not sufficient to establish that Federal Insurance was prohibited by agreement or contract from imposing a service charge for the preparation of certificates of insurance. The evidence presented by the Department is not sufficient to establish that the Respondent instituted a policy at Federal Insurance requiring customers to purchase towing coverage from L.N.V., Inc., as a condition of purchasing an automobile insurance policy or that the Respondent developed a sales scheme whereby the application for and explanation of the towing coverage was hidden. The evidence is sufficient to establish only one instance in which an unidentified person employed at Federal Insurance failed to disclose the particulars of the towing coverage. The evidence presented by the Department is not sufficient to establish a pattern at Federal Insurance of agents failing to disclose the $100 service charge for preparing certificates of insurance, of agents imposing the service charge to policies for which no certificates of insurance are prepared in the normal course of business, or of failing to inform customers of the nature of and charge for ancillary coverage such as towing coverage. Finally, the evidence presented by the Department does not establish that the Respondent or the agents involved in the transactions at issue in this proceeding failed to remit any portion of the premiums owing to the insurance companies for the policies sold to Mr. Clark, Ms. Andrews, or Ms. Davidson. In the case of Mr. Clark and Ms. Andrews, the premiums quoted to them were correct and the premiums set forth on the premium finance agreements were correct; it is irrelevant in this respect that Mr. Clark and Ms. Andrews may have believed that their $330 and $271 down payments were to be applied solely to the premiums owed on the policies. Likewise, the full amount of the premium initially calculated for Ms. Davidson's automobile insurance policy was paid to the insurance company by Federal Insurance.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Insurance enter a final order dismissing all three counts of the Amended Administrative Complaint filed against Howard Irvin Vogel. DONE AND ENTERED this 16th day of September, 1998, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO 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 September, 1998.
The Issue The issues in this case are whether Respondent, Timothy Michael Crowley, committed the offenses alleged in an Administrative Complaint issued by Petitioner, the Department of Financial Services, on September 14, 2006, and, if so, what penalty should be imposed.
Findings Of Fact The Parties. Petitioner, the Department of Financial Services (hereinafter referred to as the "Department"), is the agency of the State of Florida charged with the responsibility for, among other things, the investigation and prosecution of complaints against individuals licensed to conduct insurance business in Florida. Ch. 626, Fla. Stat. Respondent Timothy Michael Crowley was, at the times relevant, licensed in Florida as a life and health (2-18) agent, and a general lines, property and casualty agent. Mr. Crowley’s license number is A058537. Mr. Crowley, who is 61 years of age, has been an insurance agent for approximately 30 years. At the times relevant to this matter, Mr. Crowley was employed by Insurance Center of South Florida (hereinafter referred to as “Insurance Center”). Insurance Center is located in Coral Springs, Florida. At all relevant times, Mr. Crowley transacted commercial lines of insurance for Insurance Center. Count I; Xiaoqu Ma and Q-Nails. The Department has abandoned the charges of Count I, involving Xiaoqu Ma and Q-Nails, in Department’s Proposed Recommended Order. The evidence concerning Count I failed to prove the factual allegations necessary to support the charges of Count I. Count II; Charles Rosenthal and Cer-Tax, Inc. On or about December 15, 2004, a letter and three forms were faxed from Mr. Crowley on Insurance Center letterhead to Cer-Tax, Inc. (hereinafter referred to as “Cer-Tax”), an accounting business owned and operated by Charles Rosenthal. Insurance Center had been providing office general liability insurance coverage to Cer-Tax for several years. Mr. Crowley’s letter was sent to Cer-Tax because it was time for Cer-Tax to renew its insurance. Mr. Crowley stated, in part, the following in his letter, which was dated December 10, 2004, to Cer-Tax: We are pleased to offer the following quote for the renewal of your expiring office general liability policy. North Point Insurance Company $300,000 General Liability Policy Aggregate $300,000 General Liability Per Occurance [sic] $100,000 Damage to Rented Property of Others This policy is for premises liability only. Total annual premium $582.00 This quote is based on the imformation [sic] provided, subject to loss history verification, a satisfactory inspection and compliance with all recommendations. In order to bind the coverage we will need a check in the amount of $582.00 and the enclosed forms signed. You can fax the forms back to me and then please mail the originals with your signature. Please be sure to read the attached notice of terrorism insurance coverage. This notice is required by Federal Law and must be signed at the time of binding. Please feel free to call in the event you should have any questions regarding your coverages or the renewal process. The three forms attached to the December 10, 2004, letter for Mr. Rosenthal’s signature included: a “Notice-Offer of Terrorism Coverage and Disclosure of Premium” form; an “Applicant Information Section”; and a document titled “Nation Safe Drivers Enrollment Application” (hereinafter referred to as the “Nation’s Application”). While Mr. Crowley’s letter clearly indicates that all three forms, including the Nation’s Application, had to be signed on behalf of Cer-Tax and a total payment of $582.00 had to be made “[i]n order to bind the coverages,” described in the letter as “general liability” coverages, the Nation’s Application had nothing to do with the office general liability coverage Cer-Tax desired and Mr. Rosenthal thought he was renewing. In fact, the Nation’s Application was for an ancillary insurance coverage or product that provided accidental death benefits and membership in a motor club. Insurance Center had begun selling the Nation Safe Drivers product after Mr. Crowley became employed by Insurance Center. In addition to having no direct relationship to the office general liability coverage Cer-Tax desired and Mr. Rosenthal was told by Mr. Crowley in his December 10, 2004, letter Insurance Center was renewing, there was a separate charge for the Nation Safe Drivers product. The charge was $100.00 and it was included in the $582.00 charge Mr. Crowley told Cer-Tax was the total annual premium for Cer-Tax’s renewal of its office general liability policy. The actual cost of the office general liability insurance policy was $482.00, a fact which was not explained by Mr. Crowley to Mr. Rosenthal. Even if Mr. Rosenthal had paid more attention to the documents he was told to sign, it is unlikely that Mr. Rosenthal or any other reasonable person would have concluded that he was paying for anything other than the renewal of Cer-Tax’s office general liability insurance policy. Nor should Mr. Rosenthal, given Mr. Crowley’s explanation, have reasonably concluded that the Nation Safe Drivers product was a policy separate from the one he thought he was purchasing. As instructed in the December 10, 2004, letter from Mr. Crowley, on or about December 16, 2004, Mr. Rosenthal signed the three documents where they had been marked with an “x” in a circle. Mr. Rosenthal also included his birth date on the Nation’s Application. The forms and a check for $582.00 payable to Insurance Center were returned to Insurance Center. Insurance Center, while informing Mr. Rosenthal and Cer-Tax that it was selling Cer-Tax an insurance product from North Pointe Insurance Company, actually sold two separate products: an office general liability policy from North Pointe Insurance Company; and a Nation Safe Drivers product providing accidental death benefits and membership in a motor club. The latter product was not one which Cer-Tax was aware it was purchasing or one that it desired. While Mr. Rosenthal is an educated accountant, authorized to represent clients before the Internal Revenue Service, he is not an insurance agent. Mr. Rosenthal, given the representations in Mr. Crowley’s December 10, 2004, letter, acted reasonably in following Mr. Crowley’s instructions and in not inquiring further about the Nation’s Application. Count III; Selma Schevers and Realty Unlimited, Inc. On or about December 10, 2004, a document and three forms were faxed by Mr. Crowley to Realty Unlimited, Inc. (hereinafter referred to as “Realty Unlimited”), and Selma Schevers, the owner of Realty Unlimited. Mr. Crowley stated, in part, the following in the document: Insurance Company: National Insurance Company---Rated A+ by A.M. Best Co. Business Personal Property Business property - $25,000.00 per location #1 & #2, Location #3 $40,000 special form including theft valued on a replacement cost basis. $500 deductible Theft sublimt [sic] $25,000 Including wind/hail 2% deductible or $1,000 whichever is greater Any other peril deductible - $1,000 Business income $100,000 per location payable 1/3 over 90 days Commercial General Liability Coverage General Aggregate: $2,000,000 Per Occurrence: Products and Completed $1,000,000 Operations: $Excluded Personal Injury: $1,000,000 Advertising Injury: $Excluded Fire Damage Leagal [sic] Liability: $100,000 Medical Payments: $5,000 Deductible $500 per claim – Occurrence Basis Professional Liabilty General Aggregate: None Included in General Liability Total Annual Premium $5190.00 . . . . Please sign the two applications, terrorism form, and the Nations enrollment form. Please fax back to me with your check and be sure to mail the original signatures to me. Also please sign this form and return the original to me to authorize me to sign your name to the premium finance agreement. X I will bind your coverages as soon as I receive your check and the faxed signed forms. I will then send you a certificate of insurance showing all the coverages are in effect. Please call should you have any questions about your coverages or what needs to be signed. One of the forms sent to Ms. Schevers was a Nation’s Application identical to the one sent to Cer-Tax. While Ms. Schevers could not remember seeing the Nation’s Application, she did identify her date of birth written on the application as being in her handwriting. While Mr. Crowley’s letter, unlike the one sent to Cer-Tax, identifies the Nation’s Application, his letter only describes the insurance Realty Unlimited was interested in purchasing, which was business general liability insurance, and fails to explain what the Nation’s Application is for. Mr. Crowley indicates in the document that he will “bind your coverages as soon as I receive your check and the faxed signed forms,” which included the Nation’s Application. Mr. Crowley also suggested in the document that the “Total Annual Premium” of $5,190.00 was for the business general liability insurance. He failed to inform Realty Unlimited that the $5,190.00 premium included an additional charge of $200.00 for Nation Safe Drivers coverage, coverage which had not been requested by Realty Unlimited and was unwanted coverage. While Ms. Schevers, on behalf of Realty Unlimited, signed some of the forms sent to her by Mr. Crowley, she did not sign the Nation’s Application. She returned the signed forms on or about December 10, 2004, with a down payment of $1,480.00, which Mr. Crowley had indicated was acceptable. The down payment from Realty Unlimited was divided by the Insurance Center, with $1,280.00 being applied toward the business general liability insurance desired by Realty Unlimited and $200.00 applied in full payment for Nation Safe Drivers coverage despite the fact that Ms. Schevers had not signed the Nation’s Application. Insurance Center, while informing Ms. Schevers and Realty Unlimited that it was selling Realty Unlimited an insurance product from National Insurance Company, actually sold two separate products: a business general liability insurance policy from National Insurance Company; and a Nation Safe Drivers product providing accidental death benefits and membership in a motor club. The latter product was not one which Realty Unlimited was aware it was purchasing, one that it desired, or one for which Ms. Schevers even signed an application. Nor was it one, assuming Ms. Schevers saw the Nation’s Application, Ms. Schevers should have realized was not part of the insurance product she wished to purchase. Counts IV and V. The Department has abandoned the charges of Counts IV and V at hearing and in Department’s Proposed Recommended Order. No evidence concerning Counts IV and V was presented at hearing to support the charges of these Counts. Aggravating/Mitigating Factors; Prior Disciplinary Action Against Mr. Crowley. In addition to this disciplinary matter, an Administrative Complaint (hereinafter referred to as the “1997 Administrative Complaint”) was issued against Mr. Crowley on or about April 2, 1997. The charges of the 1997 Administrative Complaint, which included allegations of wrong-doing similar to those at issue in this case, were resolved by a Consent Order issued pursuant to a Settlement Stipulation for Consent Order. Among other things, the Consent Order ordered that Mr. Crowley cease and desist from using any methods or practices in the business of insurance which would constitute the act or practice of “sliding.” Aggravating/Mitigating Factors; Reimbursement of Premiums. The premiums paid by Cer-Tax and Realty Unlimited have been refunded by Mr. Crowley and Insurance Center.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Department finding that Timothy Michael Crowley violated the provisions of Chapter 626, Florida Statutes, described, supra; dismissing all other charges; and suspending his license and appointment for a period of twelve months. DONE AND ENTERED this 27th day of November, 2007, in Tallahassee, Leon County, Florida. S LARRY J. SARTIN 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 27th day of November, 2007. COPIES FURNISHED: Robert Alan Fox, Senior Attorney Division of Legal Services Department of Financial Services 612 Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0333 Jed Berman, Esquire Infantino and Berman Post Office Drawer 30 Winter Park, Florida 32790-0030 Honorable Alex Sink Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Daniel Sumner, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0307
Findings Of Fact At all times pertinent to the allegations contained herein, the Petitioner, Department of Insurance, (Department), was the state agency responsible for the licensing and registration of insurance agents in Florida and for the regulation of the insurance industry in this state. At the same time, Respondent was licensed in Florida as a general lines agent, a life and health (debit) agent, a life and health agent, and as a dental health care services contract salesman. He was president, director and registered agent of, and was the only licensed insurance agent working at, Devor of Brandon, a general lines insurance agency located in Brandon, Florida. At the times in issue, Respondent employed Jay Schetina, not a licensed insurance agent in Florida, to work as a salesman at the Brandon office. Mr. Schetina worked directly under the supervision and control of the Respondent and was in charge of the Brandon office when Respondent, who worked four days a week at the other office he owned in Cape Coral, Florida was not there. On January 11, 1989, Nellie Wynperle Henry went to the Respondent's Brandon agency to buy automobile insurance. She dealt with Mr. Schetina who sold her a policy to be issued by Underwriters Guarantee Insurance Company for an annual premium of $1,288.00, and to be effective January 17, 1989. She gave Mr. Schetina a $429.00 down payment and ultimately was issued policy no. 12207947. The policy reflected Respondent as agent for the company. Though she was not told what it was and does not recall signing it, an application for an auto service contract, to be issued by Century Auto Service, was also prepared and bears what purports to be her signature. That application was prepared and submitted without her knowledge or permission. The fee for the policy was $40.00, of which the agency got to keep 90%. Since she was already a member of AAA and had their service coverage, Ms. Wynperle did not need the service club policy sold to her at Respondent's agency and, in fact, had told Mr. Schetina so. Though she was charged for the service policy, she never received a copy of it and did not know she had it. At the time she applied for the auto insurance, Ms. Wynperle also applied to finance the unpaid balance due over and above the down payment through Underwriter's Financial of Florida, Inc., a premium finance company. The premium finance agreement includes the amount of the unwanted service policy, and is also incorrect in that it reflects that the down payment tendered by Ms. Wynperle was only $389.00. Dorothy Lunsford purchased auto insurance from the Respondent's agency on January 18, 1989. The premium for her policy, also with Underwriters Guarantee, was $707.00 and she made a down payment, by check, of $217.00. She financed the balance but the application for financing showed a down payment of only $177.00. On the same day, an application form for an auto service policy was also submitted in Ms. Lunsford's name. The cost of this policy was $40.00. On January 31, 1989 Joanne Coleman applied for automobile insurance at Respondent's agency. She was to be insured by two companies' policies, one issued by United Guarantee and one by Hamilton Insurance Company. The total combined premium was $670.00. Both policies were issued and Respondent's agency was listed as agent on both. She paid for the policies with a check for $687.00. No explanation was given for the difference. At the same time she applied for the auto insurance, though she had had no discussion with the clerk with whom she dealt at the agency about it, an application for an auto service policy was also filled out in her name, carrying a premium of $20.00. She did not receive a service policy. She neither authorized or consented to the submittal of the service club application in her name. Ms. Coleman's memory of the events, however, was not clear, but it is clear that she did not want the service policy she was charged for. On February 9, 1989, Kathy Gall applied for auto insurance with the Respondent's agency. The annual premium was$733.00 and at the time, she gave the agent a check for the down payment in the amount of $240.00. She applied to finance the balance but when prepared at the agency, the application form reflected a down payment of only $220.00. This was in error. However, at that same visit, an application for an auto service policy was also filled out in Ms. Gall's name. The policy bore a premium of $20.00. At no time did Ms. Gall authorize that service policy nor, in fact, was it ever discussed with her and she did not know she was purchasing it. Finally, on February 6, 1989, Lucinda Romano applied with the Respondent's agency for an automobile insurance policy with Allegheny Mutual Casualty Company. At that time, she gave Devor a check for $61.80. Though at the time she went into the agency she did not intend to purchase an auto service contract because she was having financial problems and wanted only the most basic lawful coverage, and did not sign the application for it, she was charged for an auto service policy at a cost of $20.00. She thought she was purchasing only PIP coverage which cost $60.00. Ms. Romano subsequently requested a refund of the amount she paid for the auto service policy and the payment was refunded by check on May 19, 1989 from Jay Schetina. Sometime after the Devor agency was taken over by Sam Capitano/Action Insurance Agency, and the latter's employees were servicing the company's files, Ms. Brown-Parker, an employee of Action found the auto service policies, including those issued in the name of Ms. Romano, Ms. Gall, Ms. Coleman, and Ms. Wynperle,and Ms. Lunsford, which had not been transmitted to the policyholders. Both copies of the policy were in the file. Respondent is also the subject of a Consent Order issued on February 26, 1990, subsequent to the date of the matters in issue herein. The Settlement Stipulation For Consent Order, on which the Order is based, refers to the matters in issue here which relate to Respondent's allowing his non-licensed employees to use his license to practice insurance, and allowed the agency to operate, at least at times, without an active, full time agent in charge. At paragraph 10(c), the Stipulation provides, in part: ... If the Department has good cause to believe that, after the issuance of the Consent Order in this cause, unlicensed individuals are transacting insurance at any agency at which Respondent operates as a general lines agent ..., or that any agency at which Respondent operates ... is not at all times after issuance of the Consent Order in this cause under the active, full-time charge of a general lines agency, the Department shall initiate proceedings to suspend or revoke the licenses and eligibility for licensure and registrations of the Respondent based upon the original grounds as alleged in the Administrative Complaint referred to herein. The original charges referred to, supra, relate to Respondent's alleged authorization of unlicensed employees to transact insurance, and his alleged authorization of the agency to, at times, operate without an active, full-time agent in charge. It did not refer to the incidents alleged herein, to wit: theimproper charges for undesired auto club membership and the preparation of false premium finance applications.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that a Final Order be issued dismissing the allegations that Respondent, John W. Ganter, violated Section 626.611, Florida Statutes, but finding him guilty of violations of Section 626.621, 626.9521 and 626.9541(1)(k)1, Florida Statutes, as to Ms. Wynperle, Ms. Gall, Ms. Coleman, Ms. Romano, and Ms. Lunsford, and imposing a suspension of his licenses and eligibility for licensure for a period of one year. However, under the provisions of Section 626.691, it is further recommended that in lieu of the suspension, the Respondent be placed on probation for a period of two years under such terms and conditions as specified by the Department. DONE and ENTERED in Tallahassee, Florida this 10th day of October, 1991. ARNOLD H. POLLOCK 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 10th day of October, 1991. APPENDIX TO RECOMMENDED ORDER The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties to this case. FOR THE PETITIONER: 1. - 5. Accepted and incorporated herein. 6. & 7. Accepted and incorporated herein. Accepted and incorporated herein. - 12. Accepted and incorporated herein. 13. - 16. Accepted and incorporated herein. 17. - 19. Accepted and incorporated herein. 20. - 22. Accepted and incorporated herein. 23. & 24. Accepted. 25. Not a Finding of Fact. FOR THE RESPONDENT: 1. & 2. Accepted and incorporated herein. Accepted expect for the representation that Petitioner presented no evidence as to Count II. The Stipulation of the parties clearly makes detailed reference to the allegations regarding Ms. Lunsford. Accepted as to Counts VI, VII & VIII. Rejected as to Count II. Accepted and incorporated herein. - 8. Accepted and incorporated herein. Rejected. - 14. Accepted and incorporated herein. Rejected. - 20. Accepted and incorporated herein. Rejected. & 23. Accepted and incorporated herein. Accepted. Accepted. Accepted. Rejected. - 34. Accepted as to the actual dealings of the Respondent. COPIES FURNISHED: David D. Hershel, Esquire Division of Legal Services 412 Larson Building Tallahassee, Florida 32399-0300 Orrin R. Beilly, Esquire The Citizens Building, Suite 705 105 S. Narcissus Avenue West Palm Beach, Florida 33401 Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32399-0300 Bill O'Neil General Counsel The Capitol, Plaza Level Tallahassee, Florida 32399-0300
The Issue Whether Petitioner should be disciplined pursuant to a nine count administrative complaint, each count containing allegations of multiple violations of the Insurance Code.
Findings Of Fact Emerald Coast Insurance Agencies, Inc. (Emerald Coast) is a nonstandard automobile insurance agency, insuring high risk drivers who normally have a difficult time procuring insurance. Emerald Coast advertises. Some customers named in the administrative complaint responded to advertisements featuring "high risk, low down payment." At all times material, Respondent was licensed as a life agent, as a life and health agent, and as a general lines agent and was the corporate president, director and registered agent of Emerald Coast. Respondent was present and actively overseeing all of the applications involved in this case, even when information was written on forms by the customer, another agent, or an unlicensed employee. Most of the complaining witnesses were able to identify Respondent as being present and/or assisting while their forms were made out. DOI did not affirmatively prove that any unlicensed employee of Emerald Coast spent more than 10 percent of his employment time interacting with customers. Prior to these proceedings, DOI has never taken action against Emerald Coast or Respondent. Respondent went to DOI on two occasions prior to the filing of this administrative complaint and discussed optional coverages in an effort to avoid situations that might lead to disciplinary action. Emerald Coast has four offices in three cities. All of the events underlying the charges herein occurred in Tallahassee. Emerald Coast has written between 15,000 and 18,000 automobile insurance policies in the three years it has been open. Approximately 70 percent of Emerald Coast's customers who purchase automobile insurance policies cancel those policies prior to the renewal date. Eighty percent of these cancelled policies are cancelled for nonpayment of premium. Among these cancellations are individuals called "tag runners." Tag runners purchase the minimum required insurance for receipt of an automobile license tag, with the intent of having the policy cancelled after they have made one or two payments and taking the chance that the Division of Highway Safety and Motor Vehicles will not catch up with them to suspend their licenses because insurance cancellations may take up to six months, even for non-payment. Once the policy information is taken from the customer, it is entered in a computer and, within three to five days, checks are written from Emerald Coast to the insurance carriers for initial premiums. If the proposed insured fails to make a payment or stops payment on a check, the agency loses money on the transaction because the agency has already forwarded the money to the insurance company. Emerald Coast provides the option of financing a premium if a customer cannot pay it in a lump sum annually. When a customer cannot pay in full for an insurance policy, Emerald Coast offers the option of purchasing an ancillary product like an auto club for a set price in addition to paying for the insurance with a low down payment. The club cost is in addition to the total insurance premium, and the low down payment for the insurance premium is conditional upon the customer's paying for the club's product. If the customer does not want the auto club product, Emerald Coast still permits him to finance his insurance premium with a 50 percent down payment. Emerald Coast's purpose of requiring a 50 percent down payment or payment in full, or the purchase of the auto club when a small down payment is made, is to offset cancellation rates and the agency's losses incurred thereby. The premium finance companies which finance insurance policies require fees. There are no premium finance companies that require Respondent to sell auto clubs in order to sell their premium finance products. The insurance carriers charge a premium for the risk they assume with the contract of insurance. There are no insurance carriers that require Respondent to sell auto clubs in order to sell their insurance. Approximately 60 percent of the people to whom Emerald Coast has sold policies also purchased auto clubs, including towing and rental features. The larger the fee paid by the customer for the club, the greater the towing, rental and other benefits that the club provides and the greater amount the seller makes. Respondent received a 90 percent commission from Atlantic Travel Association of North Florida, Inc. for the auto clubs he sold and sent to them. Respondent also sold American Travelers Association death and dismemberment benefit contracts at a similar commission. Respondent and Emerald Coast used to sell Atlantic Travelers Association, Inc. auto clubs. As of January 1, 1992, they switched to selling Atlantic Travelers Association of North Florida, Inc. clubs. The two clubs are not associated in any way. By agreement with the new club's owner, Respondent and Emerald Coast continued to use the old forms bearing the wrong company name and submitted them to the new club. The forms do not provide the address of the club, and members are expected to submit claims through Emerald Coast. Atlantic Travelers Association of North Florida, Inc. is a valid auto club and pays valid claims. Atlantic Travelers Association of North Florida, Inc.'s owner testified that his company was prepared to honor each misnamed form that Respondent sent to him with a fee, but it is probable that the form issued in the wrong name would not be legally binding. If the form was never received by the new club, Emerald Coast's customer would have an even more tenuous claim. Therefore, Respondent's auto club customers were protected only at the new club's whim as to whether or not a contract they paid for would be honored, and each form issued by Respondent or Emerald Coast with the wrong auto club name on it constituted a misrepresentation, deceptive to the customer on several levels. Respondent also continued to use the Atlantic Traveler's Association, Inc. name on all the acknowledgments he asked his customers to sign, signifying that they understood that the auto club cost was optional and in addition to their automobile insurance. The use of the wrong name on these acknowledgment forms also was a misrepresentation. Due to space considerations, and for greater clarity, Atlantic Traveler's Association, Inc. will hereafter be referred to as "the old auto club," and Atlantic Traveler's Association of North Florida, Inc. will hereafter be referred to as "the new auto club." None of the customers named in the administrative complaint lost money as a result of any auto club sold by Respondent or Emerald Coast. The auto club contracts offered 38 different choices of benefit levels. Each of the benefit levels was an option which should have been discussed with and knowingly accepted by the customer. Respondent gave the individuals selling the auto clubs no instructions on which of the options they should sell to a customer or how they should judge which option(s) a customer needed. Routinely, neither Respondent nor any of his employees ever offered all 38 options to each customer. Rather, dependent upon the car insurance coverage the customer selected, or upon the unbridled discretion of the salesperson, each salesperson sold what he felt like. Respondent and Emerald Coast use an acknowledgment form to let the customer know he is purchasing an ancillary product, that the total cost of the ancillary product is in addition to insurance premiums, and that the ancillary product is optional and not required by law. They use a document called an "affidavit" to inform the customer of other coverages and when the coverages will go into effect and to hopefully insure that the information received from the customer is accurate. These so-called "affidavits" are neither notarized nor attested-to by anyone. Respondent acknowledged that the DOI and the insurance industry consider the word, "premium," as applying to insurance premiums only, not ancillary products such as auto clubs. See, Section 627.041(2) F.S. Laymen likewise regard the word "premium" as reflecting the cost of insurance. Respondent and Emerald Coast use generic receipts which say "premium," not "insurance premium." Where insurance premium collections and ancillary product sales were conducted simultaneously, Respondent used the word "premium" on these receipts to cover the total amount tendered by each customer as a down payment on both the insurance policy premium and on the ancillary product. He then listed only the insurance premium down payment (total amount tendered by the customer minus ancillary product full fee or down payment) on the insurance premium finance agreement because only insurance premiums can be financed on those forms. Where receipts specified "total premium" he lumped in the cost of the ancillary product. Respondent thus misused the word "premium" on receipts issued to customers. Accordingly, the receipts provided to Respondent's customers were misrepresentations and deceptive. One result of the misuse of the term "premium" was that customers sometimes were led to believe that their deposits against both auto clubs or death and dismemberment policies and insurance coverage were down payments on the insurance policies alone, even where the receipts specified "premiums" and "deposit." Accordingly, Respondent's deductions of all or part of the ancillary product fee up front resulted in false statements on other documents that the full down payment for premium or financing of premium had been made when it had not. Respondent testified that his standard operating procedure was for himself or another licensed insurance agent to explain the coverages on each of the policy application forms executed at Emerald Coast; that where marks occurred on the summary of coverage pages, they were made by himself or another Emerald Coast representative during these explanations; that he explained the cost coverage breakdown for each customer he saw; and that he instructed each customer he saw to read all documents before signing. However, the juxtaposition of the "total" space block and the column where premiums and other costs are added on the "summary of coverages and cost breakdown" form makes it impossible for the customer to quickly add up the premiums for each type of insurance coverage and the cost of ancillary product in a straight line. Also, due to the confusion of Respondent's use of the word "premium" for different purposes on different documents, the figure for total "premium" frequently cannot be reconciled among the receipt, the financing document, the insurance application, and/or the summary of coverages and cost breakdown form. Even a reasonably attentive customer would be confused by the several forms. Reading the summary before signing it would not necessarily have revealed what funds were being applied to which purpose. In some instances, more specifically set out by customer and count infra., the completed summary of coverages and cost breakdown forms were misleading or unexplainable as to what amounts were being charged to the customer. Count I (David K. Register) On January 31, 1992, David K. Register went to Emerald Coast to purchase insurance. The applications made out at that time were executed by Respondent as brokering agent. Mr. Register signed all documents without reading them. Nonetheless, he understood that he was purchasing personal injury protection, property damage coverage, comprehensive and collision coverage, and what the deductibles were at the time he signed the documents. He also knew he was purchasing an auto club at the cost of $150. The total cost of the insurance coverage he was seeking was approximately $750. Respondent required Mr. Register to purchase an auto club contract as a condition of obtaining premium financing for his insurance policies. Respondent completed a premium finance agreement for financing the unpaid premiums for the policies showing that Mr. Register had tendered a $197 premium down payment. Respondent advised Mr. Register that he owed an additional $135, due February 14, 1992. Respondent issued a receipt to Mr. Register showing the total premium was $937. When he applied with Emerald Coast, Mr. Register had four offenses on his driving record, three for unlawful speed and one for violation of the alcoholic beverage open container law. His complete driving record was not disclosed on the documents prepared. If it had been disclosed, an additional premium would have been charged. The testimony is in direct conflict on whether or not Mr. Register orally disclosed his prior violations to Emerald Coast: Mr. Register maintained that he did; Respondent maintained that he did not. There is no direct evidence to show which witness was accurate on this issue. Circumstantially, there was no reason Respondent should fail to write down violations told him by Mr. Register since Respondent was prepared to write insurance in the high risk category anyway and one way or another Respondent could have insured Mr. Register for the amount Mr. Register was prepared to pay that day. Subsequently, Mr. Register made a down payment and executed an insurance application with Progressive Insurance through Swann Insurance Agency on which he also failed to disclose his entire driving record. He did so with the explicit understanding at that time that the new carrier would run a license check on him and an additional premium would be required due to his bad driving record which he had disclosed orally to Swann Insurance Agency. The "safety net" when a bad driving record is not disclosed on an application is that carriers routinely run independent driving license checks and adjust the premium upward or refuse coverage if they discover an undisclosed bad driving record. What Swann Insurance Agency and its carrier did after the carrier researched David Register's driving history is not clear on the record. When Emerald Coast and its carrier discovered his history, they demanded a higher premium. The evidence falls short of showing that Respondent deliberately left information provided by Mr. Register off his application at Emerald Coast. On February 6, 1992, Armor, the carrier with whom Emerald Coast had placed Mr. Register's PIP and property damage coverage, notified Mr. Register and Respondent that the policy binder would be cancelled if required photographs of the vehicle were not received. On February 10, Mr. Register took the vehicle to Emerald Coast for photographs. On February 13, Respondent wrote Mr. Register a letter threatening to cancel his "policy" if the $135 "premium" were not paid by February 14. Respondent testified that the letter referred to cancellation of the auto club towing "policy" and therefore he was not threatening to cancel Mr. Register's automobile insurance policy for failure to pay for an ancillary product. However, on its face, the letter was misleading. Respondent's unique "wordology" had the effect on Mr. Register of a threat to cancel his automobile insurance policy for non-payment of the ancillary product fee. On February 14, David Register and his father wrote Respondent requesting cancellation of the insurance policies and return of all money paid, since they had purchased duplicate coverage at Swann Insurance Agency. Respondent did not forward the cancellation request to Nu-Main, general agent for the carrier with whom he had placed Mr. Register's comprehensive and collision policy. Respondent did not forward the car photographs to Armor. As a result of the photographs not being received, on February 18, Armor cancelled its binder to David Register. On March 9, 1992, the finance company sent David Register and Emerald Coast its cancellation notice for nonpayment of premiums. David Register never paid the additional $135 due on February 14 for the auto club and the new auto club had no record of his old auto club form being received. Due to his February 14 cancellation, Respondent eventually refunded Mr. Register $140 of the $212 he had paid on January 31, 1992. Mr. Register's father testified that the $72 difference was accounted for by the cost of coverage from January 31 to February 14 and cancellation fees charged by the carriers. Count II (Diedre Hawks Johnson) On August 15, 1992, Diedre Hawks went to Emerald Coast to buy minimum insurance for a used car she had just purchased and financed. She executed an application for property damage, comprehensive, collision, and PIP insurance coverages. These coverages are more than the minimum required by law, but may not be more than the minimum required by the financing of Baldwin-Foster Motors, where Ms. Hawks had just purchased the car. The record is unclear on this distinction. Ms. Hawks tendered $165. Respondent actively supervised Dan Allison, a licensed insurance agent, during this transaction. Contrary to Ms. Hawks' testimony, it is found that she understood on August 15 that she had purchased an auto club. Although she did not read them at the time, Ms. Hawks executed the premium finance agreement to obtain financing for the remainder of the automobile insurance policy premium and the application for an auto club at $150. Ms. Hawks likewise signed both an acknowledgment showing she knew she was getting an auto club for $150 and an "affidavit." She also signed a summary of coverages and cost breakdown acknowledging that Emerald Coast employees had explained the coverages, that she fully understood them, and that she had received a completed copy of that document. Her explanation at formal hearing for why she did not read what she signed was that she was in a hurry because it was late in the day and the Emerald Coast employees were rushing to get out. However, she acknowledged that Respondent gave her an opportunity to read the documents which clearly set out that she was buying an auto club for $150. However, even if she had read them, the documents presented to Ms. Hawks were ambiguous as to what the amounts paid or owing were to cover. The enumerated coverages on the cost breakdown form add up to $745 (including a $150 auto club) plus a policy fee of $25 and a "grand total" of $770. The financial agreement shows a $620 premium total with $465 financed, a $155 down payment and $65.49 per month due in monthly payments. The receipt issued to Ms. Hawks by Emerald Coast on August 15 showed that she had tendered a $165 deposit, was paying for a $770 annual premium, and owed an additional $140 deposit. Upon the foregoing, Ms. Hawks' testimony was convincing that even though she initialled the receipt requiring the additional deposit, she did not know that she still owed a $140 down payment when she left Emerald Coast and that she believed that she only had to pay her premium in monthly increments of $65.49. The next day, August 16, 1992, Underwriters Guaranty Insurance Company issued Ms. Hawks an insurance policy with an annual premium of $620. The difference of $150 between the $770 and $620 figures was the total $150 cost of the auto club which she was required to buy in order to get financing with Emerald Coast. Ms. Hawks signed a contract with the old travel club. Emerald Coast sent the contract to the new travel club. Ten dollars of Ms. Hawks' initial $165 had been applied by Emerald Coast as a down payment on the auto club. No paper specifically shows this diversion of funds. On September 8, Emerald Coast wrote Ms. Hawks that she must come in and pay $140 more on her down payment for "premium" or her insurance would be cancelled. Ms. Hawks purposefully ignored the letter since communications with the carrier clarified that the money was actually to be applied to the auto club fee. Beginning September 13, Respondent telephoned her several times to come in and make the payment. Ms. Hawks still did not pay the $140. Therefore, Respondent refused to turn over to her a copy of her automobile insurance policy when it was issued. Ms. Hawks again dealt with the carrier directly and the carrier assigned her to a new agent. She never paid the auto club fee. Count III (Christine Maddux Vollenweider) On March 16, 1992, Christine Maddux asked to finance part of a $242 premium. Respondent told her that the additional cost of financing insurance with the $242 annual premium would be $317. Respondent also told her that Emerald Coast had a condition of financing which required her to buy an auto club. Ms. Maddux executed an application for a PIP and property damage automobile insurance policy with a total annual premium of $242. Respondent told her that she must pay a $143 down payment. Ms. Maddux had only $80 with her, so she tendered $80 to Respondent, who told her she must pay the remaining $68 the following week. On her first visit, the "total premium" was $317 on the receipt ($80 received and $68 deposit due). She paid the $68 the following week, as agreed. That amount was also receipted as "total premium." On March 16, Ms. Maddux executed a premium finance agreement to obtain premium financing on the balance of the premium amount and applied for an auto club. The premium financing agreement showed that she had tendered only $73 down payment on the insurance premium. The $7 balance of her $80 went for the auto club, but no document specifically shows that diversion of funds. Ms. Maddux did not read the summary of insurance coverages and cost breakdown prior to signing it. She was not told that she could not read the document, and she signed a statement acknowledging that the coverages had been explained to her, that she fully understood them, and that she had received a completed copy of the document. All of the documents except the financing agreement consistently reflect the $75 for the auto club. Ms. Maddux applied for the auto club at a cost of $75 even though she already received equal or better auto club benefits from AAA-Plus, and had told Respondent so. No one at Emerald Coast told Ms. Maddux that she was required by law to purchase it. She applied for the auto club only because of Respondent's specific agency business practice to require an auto club purchase of any customer who had to finance insurance premiums after a down payment of less than half of the entire annual premium. The auto club contract Ms. Maddux signed was with the old club showing a cost of $75. Emerald Coast sent the contract to the new club. Ms. Maddux was issued a policy by Security Insurance Company of Hartford. Count IV (Candy Bassett) On March 16, 1993, Candy Bassett wanted to purchase the minimum required non-owner's automobile insurance to get back her driver's license, which had been suspended. She incorrectly stated to Emerald Coast that she had only four points on her driving record, when in fact she had twelve points. The points had been accumulated for speeding tickets, for driving under the influence of alcohol (DUI) with serious bodily injury, and for a conviction for failure to identify upon an accident. Ms. Bassett signed Emerald Coast's summary of coverages and cost breakdown form and the policy application form, stating therein that her violations and offenses as revealed by her were accurate and acknowledging that the coverages had been explained to her and were fully understood by her. Ms. Bassett executed both a cost breakdown and summary and an acknowledgment. The cost breakdown and summary showed she was purchasing a travel club including accidental death coverage for $100. Her acknowledgment showed she was purchasing a motor club including towing and rental reimbursement for $187. Ms. Bassett executed an application for an automobile insurance policy to be issued by Underwriters. The application listed the total annual premium as $334. Ms. Bassett tendered her down payment check in the amount of $187. The receipt showed the "total premium" to be $449 and the amount received to be $187. Ms. Bassett executed a premium finance agreement to obtain financing for the remainder of the policy premium. It showed that Ms. Bassett had tendered only an $87 down payment on a total premium of $349. Underwriters issued Ms. Bassett an insurance policy for an annual term. Respondent actively supervised her transaction and executed the policy application as brokering agent. As part of this transaction and as part of a specific Emerald Coast business practice, Respondent required Ms. Bassett to execute an American Travelers Association, Inc. accidental death and dismemberment benefits contract reflecting a fee of $100, not a towing contract as reflected on some of her other paperwork. The $100 for this death and dismemberment product constituted the difference between the $87 shown on the finance agreement as the amount tendered and the $187 check Ms. Bassett actually tendered. There is no evidence as to the status of American Travelers Association Inc. or whether it received Ms. Bassett's contract. Contrary to other documents she executed, Ms. Bassett signed an acknowledgment form to the effect that she knew the club, including towing and rental reimbursement, were optional at a fee of $187 separate from her automobile insurance and that she understood that it was not insurance. Ms. Bassett testified that she thought the death and dismemberment benefits were included in her insurance, that she was not informed that she would have to pay an additional $100 for those benefits, and that she did not intend to pay any monies for such benefits. The foregoing testimony is not entirely credible in light of the rest of the evidence. Ms. Bassett also specifically testified that she was told that the travel/accident feature was "included in the -- I can't remember how much the premium was, it was four hundred and something, he said it was included in that." (Emphasis supplied.) She also signed an acknowledgment indicating the towing fee would be in addition to the insurance premium and a paper showing the amount for financing the insurance premium totalled only $349, and she was asked to name, and did name, a beneficiary on the death and dismemberment form. Further, she admitted that she understood that she was receiving travel/accident benefits through American Travelers, and that it was required for premium financing. However, she is credible and clear that all the amounts she had paid and was going to have to pay were not fairly represented to her and that Respondent made out forms showing she was being charged $187 for an auto club or towing feature which, having no car she could not very well use, as well as forms showing she was purchasing a death and dismemberment feature at $100, purely as a requirement of financing automobile insurance. Count V (Cynthia Mann) On January 24, 1992, Cynthia Mann made application for full coverage automobile insurance. Respondent actively supervised her transaction. Respondent was the brokering agent for the policy. Ms. Mann tendered a check for $180 and was advised that an additional down payment of $95 was due on the policy. She tendered the additional $95 down payment to Respondent on February 3, 1992. Charter American Casualty Insurance Company issued her standard automobile policy. Ms. Mann also executed a premium finance agreement to obtain premium financing for the policy. This agreement indicated that the total down payment for the policy was $165. Respondent required Ms. Mann to execute an old auto club contract in order to get the financing. She signed an acknowledgment that she had been offered an opportunity to purchase insurance from Emerald Coast without any auto club. The new auto club had no record of receiving Ms. Mann's Atlantic Travel Association, Inc. contract. The record is silent as to whether or not the old auto club received her contract. The annual fee specified on the old auto club contract was $110. Emerald Coast took $110 from Ms. Mann's $180 deposit and applied it to the auto club contract. Ms. Mann signed an application form, an acknowledgment form similar to those signed by the other complainants, and an "affidavit." Ms. Mann contended that Respondent had told her that she had a towing benefit as part of the automobile insurance policy purchased. The reconciled and understandable portion of her paperwork shows otherwise. She was not told she could not read the documents placed before her for reading and signature, but she did not read any of the documents prior to signing. She did not want to spend additional time reading documents because she "knew [she] had to have insurance." However, reading the documents would not have eliminated some of the contradictory and therfore false statements as to what constituted insurance premium. Count VI (Jacque Flowers) Respondent was actively involved in both of Jacque Flowers' transactions. At all times material, Paul Wettrich, an unlicensed employee of Emerald Coast, spent less than ten percent of his time actually filling out forms for customers or taking information from customers. On December 31, 1992, Jacque Flowers went to Emerald Coast to purchase automobile insurance and executed an application for various coverages for two automobiles. On December 31, 1992, Ms. Flowers tendered $160 as a down payment to Mr. Wettrich. Mr. Wettrich signed a receipt as "salesman," and assisted Ms. Flowers in filling out the required forms. The receipt showed a total premium of $849. The Respondent executed the application as brokering agent. Mr. Wettrich never signed any of the applications on behalf of Respondent or any other licensed agent. Also, on December 31, 1992, Ms. Flowers executed an Underwriters Financial premium finance agreement to obtain financing for the remainder of the policy premium. Respondent executed that agreement as agent of record. The agreement incorrectly specified that a $187 down payment already had been made. As part of the December 31, 1992 transaction, and pursuant to Emerald Coast's standard business practice, Ms. Flowers was required to contract with Atlantic Travel Association, Inc. for an auto club at a $100 fee. The $100 auto club fee was deducted from the $160 cash payment made on that date. On December 31, 1992, Ms. Flowers was in a hurry to complete her transaction because she had her three-year-old child with her. Without reading them, Ms. Flowers signed an application form, a premium finance agreement, an acknowledgment form, an Atlantic Travel Association, Inc. form, and a summary and cost breakdown form, acknowledging the truth and accuracy of the statements contained in each document, that the coverages had been fully explained to her, and that she understood them. Effective January 1, 1993 and pursuant to the policy application, Underwriters issued to Ms. Flowers a policy with a total annual premium of $749. On January 27, 1993, pursuant her agreement on December 31, 1992, Ms. Flowers tendered to Respondent an additional $127. ($160 plus $127 would equal $287 paid up to that date.) Also on January 27, 1993, Ms. Flowers deleted one car from the policy. On February 15, 1993, Ms. Flowers deleted the second car from the policy and added a third car. This resulted in an increased premium and an addendum to the policy which had been issued January 1. Ms. Flowers paid $92 more to Respondent's brother Scott, an unlicensed employee of Emerald Coast, who signed the receipt. The addendum stated that the additional policy premium was $167, and that $67 had been the cash down payment. Respondent executed the addendum as brokering agent. In accord with its standard business practice, Emerald Coast, through Scott Whitaker, required Ms. Flowers to execute an accidental death and dismemberment contract with American Travelers Association, Inc. Twenty-five dollars for this item was taken from her $92 paid that day. The receipts and other documents provided Ms. Flowers at this time were inconsistent, and Respondent was unable to explain the inconsistencies at formal hearing. Although Ms. Flowers testified that the two ancillary product packages (auto club and death and dismemberment benefits) were never explained to her and that she would never have purchased either package if she had understood that there were additional charges therefor, her paperwork shows otherwise. Also, she specifically testified that when she went to Emerald Coast the first time, on December 31, 1992, her insurance had just been cancelled by Florida Farm Bureau due to her husband's driving record, and that when she requested full coverage, she understood "full coverage" to include towing, based on her experience with Florida Farm Bureau. Therefore, it is concluded that she wanted the towing benefit however she could get it. She also admitted that each paper was explained to her before she signed on December 31, 1992. Therefore, she knew on December 31, 1992 that she was getting towing and was paying for it through an auto club, even though the totality of the paperwork is misleading as to what amounts were paid for each purpose, and even though the several options within each type of ancillary product were not explained to her and the Emerald Coast employees chose what benefit amount to sell her each time. The December 31, 1992 old auto club package was sent to the new auto club. The record is silent as to what became of the February 15, 1993 American Travelers Association, Inc. death and dismemberment form. Count VII (Sebrena McPhaul) On September 21, 1992, Sebrena McPhaul went to Emerald Coast to purchase automobile insurance and executed applications for bodily injury, property damage, and PIP coverages with Underwriters and for physical damage coverage with Nu-Main, for a total premium of $651, to be divided appropriately between the two carriers as they required. Ms. McPhaul executed a finance agreement stating that the down payment for her insurance policies was $163. Ms. McPhaul tendered a $163 down payment check with the understanding that she would tender an additional $100 in two subsequent $50 installments. Ms. McPhaul also signed an Atlantic Travel Association, Inc. form, even though she informed Emerald Coast employees that she did not need an auto club since she had AAA. The application she signed was for an auto club at a cost of $130, a portion of which was to be taken from the down payments to be made by Ms. McPhaul. Ms. McPhaul signed a summary of coverages and cost breakdown form which stated that an auto club was covered, including payment for bail bonds, towing and labor and owner protection at a cost of $130, but she did not read it before she signed it. Ms. McPhaul admitted that the coverages had been explained to her by Scott Whitaker, an unlicensed employee of Emerald Coast, prior to her signing the summary of coverages and cost breakdown form, but maintained that he had not adequately explained that the $130 for the auto club was in addition to her insurance premium instead of part of it. Ms. McPhaul signed an acknowledgment form concerning the purchase of the auto club and an "affidavit" concerning the truthfulness of her responses, but she read neither of them, either. She conceded that if she had taken the time to read the acknowledgment form instead of just signing it, she would have understood the difference. Scott Whitaker issued her a receipt showing her total premium was $781. Respondent was in charge of the office, was actively involved in her transaction, and signed the applications as brokering agent. Emerald Coast sent the old club form to the new club. Ms. McPhaul executed a premium finance agreement to obtain financing for the remainder of the premiums for her policies which were executed by Respondent as agent of record. Ms. McPhaul was issued insurance policies for her purchased coverages, on September 21 and 22, respectively. At this point, Ms. McPhaul understood that she was paying $130 for an auto club above and beyond her premiums and financing costs. Previously, she had thought that towing was part of her standard automobile insurance contract. She blamed the misunderstanding upon misrepresentations made by Scott Whitaker, but the acknowledgment she signed is clear on this portion of the disclosure. Ms. McPhaul stopped payment on a check she had used to pay the down payment on her insurance. Emerald Coast thereby incurred a loss of $90 it had forwarded to the carriers, and also lost the cost of processing her applications. The receipts and other documents provided Ms. Flowers were inconsistent. Respondent was unable to explain the inconsistencies. Count VIII (Steve Reeves) On March 20, 1993, Steve Reeves went to Emerald Coast to purchase automobile insurance for a new truck he was leasing. He did so because he had unilaterally formed the opinion that his current truck insurance would not cover a new truck he had just leased. Mr. Reeves tendered to Emerald Coast a down payment of $175 with the understanding that he would make an additional $45 premium payment to Emerald Coast. That additional premium payment was paid by Mr. Reeves at a later date. Mr. Reeves executed a premium finance agreement to obtain financing for the remainder of his policy premium. The financing agreement showed the down payment was $120, not $175. This is the only significant discrepancy among Mr. Reeves' documents except for the wrong use of the word "premium" on the receipt and the wrong auto club being named in the acknowledgment and auto club form. Respondent executed the policy application as agent of record. The application stated that the premium was $453 plus a $25 policy fee for a total of $478. The receipt to Mr. Reeves for the down payment lists the total premium as $578, as does the cost breakdown form. The $100 difference was applied to an auto club fee. Mr. Reeves also purchased an auto club from Emerald Coast. He knew he had purchased the auto club as a condition of getting his insurance from Emerald Coast. His companion suggested going elsewhere for cheaper insurance without the auto club, but Mr. Reeves declined this suggestion because it was late in the day and he wanted to get his truck insured right then and drive it home. The auto club contract reflected a fee of $100 and bore the name of the old auto club. It was sent to the new auto club. Mr. Reeves signed an acknowledgment form which also reflected a $100 auto club fee, an "affidavit," a summary and coverage cost breakdown form, and a travel association form, but did not fully read them. Executive Insurance Company issued a policy to Mr. Reeves, which he paid on monthly for five or six months. He eventually allowed the policy to lapse for non-payment because he got in a dispute with Emerald Coast about the agency's refusal to accept payments made in its office by way of a third party check.
Recommendation Upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Florida Department of Insurance enter a final order suspending Respondent's licenses for thirteen months for eight violations of Section 626.9541(1)(x)4. and eight violations of Section 626.621(6) F.S. RECOMMENDED this 4th day of April, 1995, at Tallahassee, Florida. ELLA JANE P. 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 4th day of April, 1995. APPENDIX TO RECOMMENDED ORDER 93-5436 The following constitute specific rulings, pursuant to Section 120.59(2), F.S., upon the parties' respective proposed findings of fact (PFOF). Petitioner's PFOF: 1-5 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 6-7 Rejected as not proven. 8-10 Subordinate to the facts as found. 11-15 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer counts. Subordinate to the facts as found. Rejected as a conclusion of law 19-29 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 30-31 Subordinate to the facts as found. 32 Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective count. 33-38 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective count. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective count. Rejected as a conclusion of law. 43-47 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 48 The first sentence is rejected as a conclusion of law. The second sentence is accepted,. 49-50 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 51 Accepted as covered in FOF 18. 52-53 Subordinate to the facts as found. 54-55 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 56 Rejected in part as a conclusion of law. The remainder is covered in substance. 57-59 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 60 Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. 61-62 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 63 Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. 64-71 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 72 Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. 73-74 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. Rejected in part as a conclusion of law. Otherwise accepted. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 78-79 Accepted in part and rejected in part upon the greater weight of the credible evidence. See FOF 66-68. 80-83 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 86-87 Accepted in part and rejected in part upon the greater weight of the credible evidence. See FOF 20,24, 72-76. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. 90-95 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Rejected because not proven as stated. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 98-99 Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. 100-102 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. Rejected as a conclusion of law. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. 106-111 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Rejected as a conclusion of law. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 117-118 Rejected in part and accepted in part as covered in FOF 90-91. 119-124 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Rejected as misstating the primary party. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 123 and respective customer count. 128-130 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. Rejected as a conclusion of law. 133-138 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 139 Rejected as contrary to the record as a whole. 140-145 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 146-147 Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. 148-150 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Accepted as modified to more closely approximate the record as a whole. See FOF 23 and respective customer count. Rejected as a conclusion of law. 153-157 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. 158 Rejected as a conclusion of law. 159-162 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Respondent's PFOF: 1-18 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Legal argumentation has also been excluded. 19-20 Rejected because misleading and non-dispositive as stated. See FOF 17-20. 21 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Legal argumentation has also been excluded. 22-25 Unnecessary. Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized.Legal argumentation has also been excluded. Immaterial 28-37 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized.Legal argumentation has also been excluded. 38 Accepted but not dispositive 39-42 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized.Legal argumentation has also been excluded. 43 Rejected as not proven. 44-103 Accepted in substance, except that unnecessary, subordinate, and/or cumulative material has not been utilized, and some further explanation has been added. Some matters have been considered on the issue of credibility but not incorporated. 104 Rejected because not proven as stated. 105-108 Covered only as necessary in FOF 23-24 109-112 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized.Legal argumentation has also been excluded. The primary party has been indicated. 113-124 Rejected as quoting isolated, unreconciled testimony, as mere legal argument, and as stating a conclusion of law. 125-128 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized. Legal argumentation has also been excluded. 129-133 Rejected as quoting isolated, unreconciled testimony, as mere legal argument, an as stating a conclusion of law. 134-137 Accepted in substance, except that unnecessary, subordinate and/or cumulative material has not been utilized.Legal argumentation has also been excluded. COPIES FURNISHED: Michael K. McCormick, Esquire David D. Hershel, Esquire Daniel T. Gross, Esquire Division of Legal Services 612 Larson Building Tallahassee, Florida 32399-0333 Robert S. Cohen, Esquire Post Office Box 10095 Tallahassee, Florida 32302 Bill O'Neil, Esquire Department of Insurance and Treasurer The Capitol, PL-11 Tallahassee, Florida 32399-0300 Bill Nelson State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32399 Dan Sumner Department of Insurance and Treasurer The Capitol, PL-11 Tallahassee, Florida 32399-0300
The Issue The issue is whether Respondent is guilty of an unfair or deceptive trade practice by selling ancillary insurance products to customers without adequate disclosure, in violation of Sections 626.9541(1)(z) and 626.621(6), Florida Statutes.
Findings Of Fact At all material times, Respondent has been a licensed general lines agent, holding license number A192887. She has been licensed for 15 years and has not been disciplined. From January 2000 to July 2007, Respondent was employed by Econo Insurance Agency in Deerfield Beach. She was employed to sell insurance and otherwise serve customers. Econo Insurance Agency paid Respondent a salary, but she earned commissions from the sales of ancillary products. This case involves the sale of two products ancillary to personal injury protection (PIP) coverage: an accidental medical supplement (also known as an accidental medical protection plan) to pay the $1000 deductible under the PIP policy commonly sold by the agency and a motor club membership plan to pay for towing and a rental car. On July 27, 2004, Denise Parker visited Econo Insurance Agency to renew her PIP coverage. She had obtained her insurance from Econo Insurance Agency for 17 years. Ms. Parker initially testified that she did not meet with Respondent, but instead met with another woman, Crystal Fowler. Ms. Parker testified unequivocally that she dealt with Respondent on other occasions, but did not on July 27 and that Ms. Parker did not purchase insurance from Respondent "that year." At the hearing, Ms. Parker looked at Respondent and stated that she was not the woman with whom she had dealt on the day in question. After a short break, Ms. Parker testified that Respondent, not Ms. Fowler, sold her the product in question, an accidental medical supplement. The confusion may be attributable to the fact that Ms. Parker made two visits to the agency. The first was on July 27 to arrange for the renewal of her PIP coverage, and the second was on August 2, 2004, to pay for and obtain her policy. However, the testimony of Ms. Parker precludes assigning responsibility to Respondent, rather than Ms. Fowler, for any acts or omissions that may have taken place during the July 27 and August 2 office visits. Although documentation, described below, bears Respondent's signature, this fact does not preclude a division of responsibilities between Respondent and Ms. Fowler, who may nonetheless have presented the coverage options to Ms. Parker. On July 27, Ms. Parker signed a number of documents at the agency. One of the documents is an application to purchase an accidental medical protection plan for up to $1000 in benefits for a premium of $110. According to the application, this coverage is administered by National Insurance Underwriters, Inc., in Deerfield Beach and, according to the policy, the coverage is underwritten by "certain Underwriters at Lloyd's, London (not incorporated)." (The telephone number for claims is the same as the telephone number shown in the motor club membership plan, described below, administered by "National Safe Drivers" or "Nation Safe Drivers," so Petitioner and Respondent have tended to refer to National Safe Drivers as the obligor, or its agent, under both ancillary products.) The application clearly discloses the optional nature of the accidental medical supplement coverage. Immediately above Ms. Parker's signature is a statement: "The purchase of this plan is optional and is not required with your auto insurance policy." Beside Ms. Parker's signature and bearing the same date is the signature of Respondent, attesting that three other carriers denied this coverage. The premium finance agreement and disclosure statement, which is a single form signed by Ms. Parker on July 27, 2004, shows a premium for PIP coverage and a $110 premium to Nations Safe Drivers for accidental medical supplement coverage. The renewal premium notice discloses, immediately above Ms. Parker's signature, which is dated July 27, that she has elected the $1000 deductible on her PIP coverage. On August 21, 2004, Luery Moreno visited the Econo Insurance Agency to purchase automobile insurance. She met with Respondent and agreed to purchase the insurance from her. On this day, Ms. Moreno purchased an accidental medical supplement, even though she testified that Respondent never mentioned the accidental medical supplement that she purchased, or that this coverage was not required under Florida law. Initially, Ms. Moreno stated that this was her first visit to the Econo Insurance Agency, but, on cross-examination, she admitted that her recollection of the events of August 21 was not "clear." Upon the presentation of coverage that she had purchased in June 2003 from Econo Insurance Agency, Ms. Moreno recalled that she had purchased automobile insurance from the same agency in June 2003, that she had purchased the accidental medical supplement at that time, and that she might have asked Respondent for the same coverages when she visited the office in August 2004. In fact, Ms. Moreno had submitted a claim under the motor club membership plan that she had purchased in June 2003. As in June 2003, Ms. Moreno completed an application on August 21, 2004, for accidental medical supplement coverage. The applications both state, above her signature: "The purchase of this plan is optional and is not required with your auto insurance policy." The premium finance agreement and disclosure statement show the separate premiums for the PIP and accidental medical supplement coverages and is signed by Ms. Moreno. Because Ms. Moreno secured coverage with the Florida Automobile Joint Underwriting Association (JUA), she obtained a summary of coverages and premium, which clearly reveals that she was purchasing PIP (as well as property damage), medical payments, and towing and car rental reimbursement, although the summary of coverages and premium form fails to itemize premiums for each product, instead showing a gross premium for all coverages. Although Ms. Moreno disputed her signature on one or more of the documents, the evidence failed to establish that she did not sign all of the relevant documents. On July 30, 2004, Megan McCartin visited Econo Insurance Agency to obtain PIP coverage. She met with Respondent and agreed to purchase insurance from her. Ms. McCartin selected Econo because her family had purchased insurance from this agency in the past. Initially, Ms. McCartin testified that this was the first time that she had obtained insurance, so she brought her mother with her to help with the transaction. When presented with documents showing that she had purchased insurance from Econo Insurance Agency in July 2003, Ms. McCartin recalled that the July 2004 visit was for the renewal of the coverage that she had purchased the prior year. Most of Ms. McCartin's testimony on direct concerned the transaction in which her mother helped her, which was probably the July 2003 transaction. The documentation from the July 2003 transaction discloses that Ms. McCartin had purchased the accidental medical supplement coverage and towing and car rental reimbursement for the prior year. On July 30, 2004, Ms. McCartin renewed these coverages for the year in question. Both years, Ms. McCartin signed the applications for the accidental medical supplement with the same disclosure noted above. The premium finance agreement and disclosure statement shows the separate premiums for the PIP and accidental medical supplement coverages and the signature of Ms. McCartin. Because Ms. McCartin was purchasing insurance from the JUA, she also received a summary of coverages of premium, which clearly discloses the existence of medical payments and towing and car rental, in addition to PIP. On October 26, 2004, Ashley McCartin, Megan's sister, visited the Econo Insurance Agency to renew her automobile insurance. She met with Respondent and agreed to purchase insurance from her. Ms. Ashley McCartin testified that she had purchased automobile insurance previously from the agency and wanted only the minimum coverage required by law. Ms. Ashley McCartin recalls speaking with Respondent for nearly an hour and listening to Respondent's description of the towing package, but testified that Respondent said nothing about an accidental medical supplement or accidental medical protection plan. Ms. Ashley McCartin testified that Respondent told her that, with this insurance, she obtained towing coverage, which Ms. McCartin thought would be useful because her car was unreliable. At all times, though, Ms. McCartin intended to purchase only what the law required due to her strained financial circumstances. The documentation discloses that Ms. Ashley McCartin purchased a motor club membership plan in 2003 and 2004 and that she signed an application for an accidental medical supplement with the same disclaimer as contained in the applications described above. She also signed a JUA summary of coverages and premium, which shows, as separate items, PIP, medical payments, and towing and car rental. Likewise, Ms. McCartin signed a premium finance agreement and disclosure statement, which shows separate premiums for the PIP and accidental medical supplement coverages. The PIP coverage cost her $1450, and the accidental medical supplement cost her $110. On November 19, 2004, Alta Thayer visited Econo Insurance Agency to purchase automobile insurance. She met with Respondent and agreed to purchase insurance from her. Now 74 years old, Ms. Thayer admitted that she did not recall purchasing insurance in 2004, but seemed to recall generally a transaction with Respondent, subject to the limitations noted below. Ms. Thayer drove to the agency in a 2002 Hyundai, which was insured through the Marlin Insurance Agency, but she wanted to insure another car, a Lincoln Continental. While testifying, Ms. Thayer displayed irritation with many aspects of her transaction with Respondent. Ms. Thayer testified that other insurance agents all took photographs of the insured vehicle and checked the odometer, but Respondent did not try--it is unclear whether, when Respondent declined to photograph the car, Ms. Thayer had already informed her that the vehicle to be insured was not parked outside the office. At first, Ms. Thayer testified that Respondent had been "nasty" from the start, but then changed her testimony to say that Respondent became irritable when, the next day, Ms. Thayer returned in connection with some tag work. Ms. Thayer testified that the insurer canceled her insurance on the day after she had obtained it, on the ground that she had another car, presumably the Hyundai, insured with another company. While Ms. Thayer sat and waited to be taken care of, she complained that the receptionist and Respondent chatted. When Ms. Thayer complained, she claimed that Respondent told her to file a complaint, "you old bag." Ms. Thayer testified that she and Respondent never discussed a motor club membership plan, nor did she need one. Perhaps again confusing the two cars, Ms. Thayer "explained" that the Hyundai was only two years old and had come with a five-year roadside assistance program. When reminded that she was insuring the Lincoln, Ms. Thayer testified that it had never given her problems. On November 19, 2004, Ms. Thayer signed an automobile service contract for a motor club membership plan for a "1990" Lincoln Continental. The contract calls for the payment of a $50 fee in return for towing and emergency road service and car rental reimbursement. Unlike the application for the accidental medical supplement, the application for the motor club membership plan includes no disclaimer that this plan is optional and not required with the PIP coverage. On the same date, Ms. Thayer also signed a summary of coverages and premium, which shows separate PIP and towing and car rental coverages. Four of these five transactions fail to present cases of liability without regard to the testimony of Respondent. Ms. Moreno's recollection of her transaction is impossible to separate from her recollection of the prior year's transaction. Ms. Moreno's admission that she may have asked merely for the same coverage from the prior year undermines the remainder of her testimony. Ms. Parker's recollection of her transaction is flawed by her misidentification of Respondent and the resulting possibility that Ms. Fowler, not Respondent, is guilty of the acts and omissions of which Ms. Parker complains. Ms. Megan McCartin's recollection of her transaction is impossible to separate from her recollection of the prior year's transaction. As is the case with Ms. Moreno's transaction, Ms. Megan McCartin's transaction renewed the same accidental medical supplement coverage that she had obtained the prior year with the same documentation, so it is more difficult, on this ground as well, to find Respondent guilty of any concealment or misrepresentation as to the accidental medical supplement. Ms. Thayer displayed serious credibility problems--of confusion, not prevarication. Ms. Thayer's testimony was confused at several points, as in her "explanation" that her new Hyundai did not require towing coverage when she was insuring a 14-year-old Lincoln. Repeatedly, Ms. Thayer referred to her Lincoln as a 1980 model, then a 1990 model, then a 1980 model, even after inquiry by the Administrative Law Judge intended to draw her attention to the issue and resolve it. Ms. Thayer was visibly angry at Respondent at the hearing and was decidedly adversarial as a witness. Perhaps her anger stemmed from the immediate cancelation and the agency's mishandling of her transaction, as her application revealed, on its face, that she owned another vehicle for which she was not seeking insurance. But Ms. Thayer seemed to be looking for things with which to fault Respondent, such as her failure to get up out of her chair and walk outside to photograph and inspect the car that Ms. Thayer had driven to the agency, even though this was not the car to be insured. Still working four days each week in the fitting room at Marshall's department store, Ms. Thayer proved an energetic, though not always responsive, witness, whose eagerness to bolster her own credibility extended to the assertion, late in her testimony, that she had a top secret clearance from the Korean War. After observing Respondent's demeanor during testimony and at hearing and comparing it to the demeanor of Ms. Thayer, it is highly unlikely that Respondent called Ms. Thayer an "old bag"--a fact that raises grave problems with the reliability of the rest of Ms. Thayer's testimony. The transaction with Ms. Ashley McCartin presents the only case of sliding undisclosed coverages carrying extra premiums by Respondent. Seeming to bear no grudge against Respondent, Ms. Ashley McCartin testified frankly that she told Respondent that she wanted the minimum coverage, and Respondent said nothing about an accidental medical supplement or accidental medical protection plan. However, Ms. McCartin clearly signed forms asking for this coverage and acknowledging the fact that it was not included in her PIP premium. Respondent testified that she sold 100-150 policies per month and was responsible for the tag and title work associated with these sales. A typical customer never asked just for PIP, but asked instead for minimum coverage. Respondent would take 10-15 minutes per transaction to explain bodily injury and underinsured motorist coverages and the consequences of not purchasing these items, which also offered Respondent commission income. Respondent offered accidental medical supplement and the motor club membership plan to most of her customers. Respondent testified that she told her customers that these ancillary products were "included" with their coverages. She recalled that one of the McCartins was "delighted" upon hearing that such coverage was "included," clearly suggesting that Respondent's "explanation" implied that the ancillary coverage was at no additional expense, or at least that the customer so inferred. There is some discrepancy between the versions of Ms. Ashley McCartin and Respondent. Ms. McCartin testified that Respondent never mentioned the accidental medical supplement, and Respondent testified that she always assured the customer that the ancillary coverage was "included" in the primary coverage. However, Ms. McCartin's testimony reveals little knowledge of insurance products and is consistent with her "understanding" that the medical coverage of $1000 was just part of PIP. Such a misunderstanding would be facilitated by Respondent's misleading assurance--repeated more than once at the hearing--that the accidental medical supplement is "included" with the PIP. Respondent's testimony that she assured her customers that ancillary products were "included" with the PIP coverage does not override the deficiencies noted above as to the other four customers. Ms. Parker essentially cannot say who said what to her, so, even if Respondent were misleading her customers at the time as to the relationship between ancillary products and PIP, nothing establishes that she did so with Ms. Parker. Ms. Moreno may well have told Respondent to give her the same coverage as she had the prior year, during which she had filed a claim under the motor club membership plan, so Respondent would never have had the need to "explain" to Ms. Moreno the relationship of the ancillary products to the PIP product. Ms. Thayer is the only customer who did not purchase both ancillary products, which suggests either discernment on her part or restraint on the part of Respondent--but, either way, Ms. Thayer may have obtained what she wanted. She is also the only customer for whom the alleged ancillary product is the motor club membership plan, which might reasonably have represented an attractive purchase to Ms. Thayer given the age of her Lincoln. Ms. Megan McCartin presents the closest case among the four remaining customers, but her inability to differentiate between the 2003 and 2004 transactions precludes a finding of sliding by the requisite standard of proof.
Recommendation It is RECOMMENDED that the Department of Financial Services enter a final order finding Respondent guilty of one count of violating Sectios 626.9541(1)(z)2. and 3., Florida Statutes, and, thus, Section 626.621(6), Florida Statutes, and imposing a thirty-day suspension. DONE AND ENTERED this 30th day of April, 2008, in Tallahassee, Leon County, Florida. ROBERT E. MEALE 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 30th day of April, 2008. COPIES FURNISHED: Honorable Alex Sink Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Daniel Sumner, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0307 William Gautier Kitchen, Esquire Department of Financial Services Division of Legal Services 200 East Gaines Street Tallahassee, Florida 32399-0333 Jed Berman, Esquire Infantino and Berman Post Drawer 30 Winter Park, Florida 32790
The Issue Whether Respondent committed the violations alleged in the Amended Administrative Complaint issued against him, as modified at hearing, and, if so, what penalty should be imposed.
Findings Of Fact Based on the evidence adduced at hearing, and the record as a whole, the following findings of fact are made to supplement and clarify the extensive factual stipulations set forth in the parties' Statement of Facts Admitted3: Respondent has been employed by Direct General Insurance Agency, Inc. (Direct General) for the past five years. He is the manager of a Direct General office located at 7558 West Commercial Boulevard, Lauderhill, Florida. This has been Respondent's principal business address since September 2005. Prior to September 2005, Respondent was the manager of a Direct General office located at 8300 West Oakland Park Boulevard, Sunrise, Florida. Respondent did not notify Petitioner of this September 2005 change of his principal business address within 60 days of the change. He assumed, erroneously it turns out, that Direct General's "licensing department" would inform Petitioner of the change. At all times material to the instant case, Respondent, as a licensed agent acting on behalf of Direct General, sold automobile insurance, along with three ancillary or "add-on" products. The three "add-on" products Respondent sold were an accident medical protection plan, a travel protection plan, and a term life insurance policy (hereinafter referred to collectively as the "Add-Ons"). From September 2003 to May 2006, Respondent sold these Add-Ons to approximately 1300 customers, including Ms. Roberts- Hall, Mr. Bentivegna, and Mr. Moore. For his efforts on behalf of Direct General, Respondent was paid an hourly wage, plus a commission for each of the Add- Ons he sold. He did not receive a commission for any automobile insurance policy sales he made. Direct General had sales goals with respect to Add-Ons that it expected its agents to meet. How well an agent did in meeting these goals was an "important factor" in the job performance evaluation the agent received annually from his supervisor (as Respondent was aware). An agent's failure to meet a particular goal, however, did not inevitably lead to the "fir[ing]" of the agent. Nonetheless, it was obviously in the agent's best interest to sell as many Add-Ons as possible. Respondent's supervisor was Sara Silot, a Direct General District Manager. In addition to an annual job performance evaluation, Ms. Silot provided Respondent, as well as her other subordinates, with regular feedback during the course of the year regarding their Add-On sales numbers. Each of the customers (Ms. Roberts-Hall, Mr. Bentivegna, and Mr. Moore, hereinafter referred to collectively as the "Complaining Customers") referenced in Counts I through VII and XV through XVIII of the Amended Administrative Complaint (hereinafter referred to collectively as the "remaining sliding counts") purchased the policies referenced in these counts in person at Respondent's office, where they were given paperwork to review and to then initial, sign, and/or date in numerous places in order to consummate the transaction. This paperwork consisted of, depending on the transaction, as few as 14, and as many as 20, pages of various documents (hereinafter referred to collectively as the "Transactional Paperwork"). The Transactional Paperwork clearly and conspicuously informed the reader, consistent with what Petitioner orally explained at the time of purchase to each of the Complaining Customers, that the Add-Ons being purchased were optional policies that were separate and distinct from the automobile insurance policy also being purchased and that these Add-Ons carried charges in addition to the automobile insurance policy premium. In providing his oral explanation to the Complaining Customers, Respondent circled (with a writing utensil) language in the Transactional Paperwork that conveyed this information about the Add-Ons. His purpose in doing so was to bring this language to the attention of the Complaining Customers. In view of the contents of the Transactional Paperwork, including the portions highlighted by Respondent, and what Respondent told the Complaining Customers concerning the Add-Ons, it was reasonable for Respondent to believe that the Complaining Customers were informed about the Add-On products they were being sold and were (by executing the paperwork) consenting to purchase them. The Transactional Paperwork included, among other things, a one-page Accident Medical Protection Plan form; a one- page Accident Medical Protection Plan Application form; a one- page American Bankers Insurance Company Optional Travel Protection Plan form; a one-page Statement of Policy Cost and Benefit Information-One Year Term Life Insurance Policy form; a one-page Explanation of Policies, Coverages and Cost Breakdown form; a multi-page Premium Finance Agreement; and a one-page Insurance Premium Financing Disclosure form. Among the information contained on the top half of the Accident Medical Protection Plan form was the cost of the plan. The bottom half of the form read as follows: THIS IS A LIMITED POLICY. READ IT CAREFULLY. I the undersigned understand and acknowledge that: This Policy does not provide Liability Coverage for Bodily Injury and Property Damage, nor does it meet any Financial Responsibility Law. I am electing to purchase an optional coverage that is not required by the State of Florida. My agent has provided me with an outline of coverage and a copy of this acknowledgment. If I decide to select another option or cancel this policy, I must notify the company or my agent in writing. I agree that if my down payment or full payment check is returned for any reason, coverage will be null and void from the date of inception. Insured's Signature Date I HEREBY REJECT THIS VALUABLE COVERAGE: Insured's Signature Date The Accident Medical Protection Plan Application form indicated what the annual premium was for each of the three categories of coverage offered: individual, husband and wife, and family. The top half of the American Bankers Insurance Company Optional Travel Protection Plan form summarized the benefits available under the plan. The bottom half of the form read as follows: Please Read Your Policy Carefully for a Full Explanation of Benefits Purchasing the Optional Travel Protection Plan is not a condition of purchasing your automobile liability policy. I hereby acknowledge I am purchasing an Optional Travel Protection Plan, and that I have received a copy of this acknowledgement. ___ ____ Insured's Signature Date I HEREBY REJECT THIS VALUABLE COVERAGE: Insured's Signature ____ Date The Statement of Policy Cost and Benefit Information- One Year Term Life Insurance Policy form noted the amount of the "Annual Premium for this policy" and that the "Annual Premium included a $10.00 policy fee that [was] fully earned." On the Explanation of Policies, Coverages and Cost Breakdown form, the Add-Ons were listed under the heading of "optional Policies" and the cost of each Add-On was separately stated. The first page of the Premium Finance Agreement also contained an itemization of the cost of each Add-On, as did the Insurance Premium Financing Disclosure form. On this latter form, the Add-Ons were included in a section entitled "Optional insurance coverage." The form also advised, in its prefatory paragraph, that: Florida law requires the owner of a motor vehicle to maintain Personal Injury Protection and Property Damage liability insurance. Under certain circumstances as provided in Chapter 324, Florida Statutes, additional liability insurance may be required for Bodily Injury liability. Also, additional insurance is usually required by a lienholder of a financed vehicle. Florida law does not require other insurance. The direct or indirect premium financing of auto club membership and other non-insurance products is prohibited by state law. Each of the Complaining Customers was capable of reading the above-described documents and understanding that purchasing the Add-Ons was optional, not mandatory, and involved an additional cost.4 Respondent gave each of them as much time as they wanted to read these documents, and he did not refuse to answer any of their questions. Ms. Roberts-Hall rejected the travel protection plan, and signed and dated the American Bankers Insurance Company Optional Travel Protection Plan form so indicating, in 2004, 2005, and 2006. Mr. Bentivegna rejected the term life insurance policy, as documented by his signature next to the word "Rejected," which was written in by hand at the bottom of the Statement of Policy Cost and Benefit Information-One Year Term Life Insurance Policy form. As noted above, unlike Mr. Bentivegna, Ms. Roberts- Hall and Mr. Moore each signed up for a term life insurance policy. On Mr. Moore's Application for Life Insurance, his three children, Melissa Moore, Kenneth Moore, Jr., and Timothy Brown-Moore, were named as "Beneficiar[ies]." While Kenneth Moore, Jr., and Timothy Brown-Moore were listed as "Members of Applicant's Household" on Mr. Moore's application for automobile insurance, Melissa Moore (who, at the time, was away at college) was not. Elsewhere on Mr. Moore's Application for Life Insurance, in the "Insurability Data" section, the question, "Have you during the past two (2) years had, or been told you have, or been treated for . . . a) Heart trouble or high blood pressure?" was answered, incorrectly, in the negative. Mr. Moore placed his initials next to this answer. Several days after her May 2004 purchases, Ms. Roberts-Hall telephoned Respondent and told him that she was having second thoughts about her accident medical protection plan purchase. Respondent suggested that she come to his office and speak with him in person, which she did. During this follow-up visit, Respondent went over with her the benefits of the plan, after which she told him that she was going to keep the coverage. Ms. Roberts-Hall took no action to cancel either of the Add-Ons (the accident medical protection plan and term life insurance policy) she had purchased in May 2004. In fact, she renewed these coverages in May 2005 and again in May 2006 (along with her automobile insurance policy). Prior to these renewals, in February 2005, when contacted by one of Petitioner's investigators who was conducting an investigation of possible "sliding" by Respondent, Ms. Roberts-Hall had expressed her displeasure that Respondent had "given her these additional products." Mr. Bentivegna and Mr. Moore were also contacted by Petitioner's investigative staff to discuss the Add-On purchases they had made from Respondent. Mr. Moore was contacted approximately ten months after his May 2004 purchases. The three Add-Ons he had purchased were still in effect at the time, but he took no action to cancel any of these policies. He did not renew them, however; nor did he do any other business with Respondent following his May 2004 purchases. Petitioner's policy is have its investigators "make it very clear from the beginning," when interviewing aggrieved consumers, that no promises are being made that these consumers will be "getting their money back" if they cooperate in the investigation. It does not appear that there was any deviation from this policy in Petitioner's investigation of Respondent. The investigation of Respondent led to the charges against him that are the subject of the instant case.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that Petitioner issue a Final Order finding Respondent guilty of committing the violation of Section 626.551, Florida Statutes, alleged in Count X of the Amended Administrative Complaint, fining him $250.00 for such violation, and dismissing the remaining counts of the Amended Administrative Complaint. DONE AND ENTERED this 29th day of March, 2007, in Tallahassee, Leon County, Florida. S STUART M. LERNER 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 29th day of March, 2007.
