Findings Of Fact The Respondent, Jeffrey Allan Azis, is licensed by the Florida Department of Insurance as a General Lines Agent and did business as the American Automobile Insurance Agency, Inc., 603 NW 10th Avenue, Gainesville, Florida, during the period of time delineated in the Amended Administrative Complaint. The Respondent transacted the sale of motor vehicle insurance and an automobile club membership to the persons identified in Counts I, II, IV and V of the Administrative Complaint. Each of the persons identified in Counts I, II, IV and V of the Amended Administrative Complaint was charged for membership in an automobile club by the Respondent or his employees. With respect to Counts I through VI of the Amended Administrative Complaint, the following findings are made: Count I James E. Rippy, Jr., purchased automobile insurance directly from the Respondent at the American Auto Insurance Agency, Inc., Gainesville, Florida, on or about June 10, 1979. He requested the minimum coverage necessary to insure his vehicle to obtain a license tag. (Vol. 1, T-35) Mr. Rippy did not request motor club coverage and was not aware of what a motor club covered. (Vol. 1, T- 32) Sometime after purchasing insurance from the Respondent, Mr. Rippy discovered that his coverage included membership in a motor club. (Vol. 1, T- 33-34) At the Respondent's office, Mr. Rippy and his wife Norma, signed documents which included a membership application in Nation Motor Club with a membership fee of $25.00 [Respondent Exhibit 2(1)] and an application for coverage which included the following disclosure statement also signed by Mr. Rippy in addition to the application form: I understand the Nation Motor Club (NMC) membership applied for this date 6/30/79, through the American Auto Insurance Agency, Inc. is a separate item, that pays in addition to my auto insurance policy. I understand the additional charge for this coverage is included with my down payment. Applicant (signed) Mr. Rippy was not pressured by the Respondent to sign these documents and could have taken additional time to read and ask questions if he had desired. (Vol. 1, T-49-50) write and do mathematics at a basic level. Count II On or about December 4, 1979, Deborah M. Zapp purchased automobile insurance from American Auto Insurance Agency, Inc. Gainesville, Florida, from an employee of the Respondent's identified as "Judy". (Vol. 1, T-17) Ms. Zapp was unclear regarding the coverage she requested from Judy, but was sure that she would not have purchased motor club membership since she regarded it as an "extra". (Vol. 1, T-18-20) While at the agency on December 4, 1979, Ms. Zapp was asked to sign various papers which she read before signing. (Vol. a, T-20) These included a membership application in Nation Motor Club (Respondent's Exhibit 1) and an application form which contained the following disclosure statement: I understand the Nation Motor Club membership applied for this date 12/4/79, though the American Auto Insurance Agency, Inc. is a separate item, that pays in addition to my auto insurance policy. I understand the additional charge for this coverage is included in my down payment. Applicant (signed) (Respondent's Exhibit 1) Ms. Zapp was not rushed while reading the documents presented to her for signing and could have taken as much time as she wanted to go over them. (Vol. 1, T-20) However, notwithstanding reading and signing the membership application and disclosure statement regarding the motor club, Ms. Zapp did not know she had purchased motor club coverage when she left the Respondent's office. (Vol. 1, T-21) Ms. Zapp is a graduate of Sante Fe Community College and attended a university for one year following her graduation. (Vol. 1, T-16) At the hearing on February 5, 1981, she appeared bright and fairly assertive. Count III In Count III, Petitioner alleges that the Respondent in the conduct of business under his license violated various provisions of the Insurance Code. The allegations of Count III requires an application of the facts found in Counts I and II to Sections 626.9521, 626.9541(11)(a), 626.9541(5)(a), 626.9541(15)(b), and 626.621(b), Florida Statutes. Count III is duplicated by Count VI and calls for legal conclusions which will be discussed in the conclusions of law section of this Recommended Order. Count IV The deposition of Charles D. Smith was admitted into evidence as Petitioner's Exhibit 10. Mr. Smith currently holds an insurance license and has a bachelor's degree. (Petitioner's Exhibit 10 at 4) Mr. Smith purchased automobile insurance from the American Auto Insurance Agency, Inc. on or about May 1, 1980 (Petitioner's Exhibit 10 at Appendix) Mr. Smith thought he was purchasing only Personal Injury Protection (PIP). (Petitioner's Exhibit 10 at 4) In order to get an auto tag, Mr. Smith requested the minimum coverage. (Petitioner's Exhibit 10 at 5) Like Mr. Rippy and Ms. Zapp, Mr. Smith signed an application for motor club membership and disclosure statement stating he understood he was purchasing motor club coverage at the time of his application for insurance. (Petitioner's Exhibit 10 at 7) Mr. Smith intended to purchase the minimum amount of insurance at the lowest price but did not require of either the Respondent or his employees whether motor club coverage was included in the price quoted. (Petitioner's Exhibit 10 at 8,9) Neither the Respondent nor his employees orally explained motor club coverage to Mr. Smith. At the bottom of Mr. Smith's insurance application the following disclosure statement was signed by him: I understand the interstate membership applied for this date 5/1/79, through the American Auto Insurance Agency, Inc. is a separate item that pays in addition to my auto insurance policy. I understand the additional charge for this coverage is included in my down payment. Applicant (signed) (Petitioner's Exhibit 10 at Appendix) Mr. Smith's decision to purchase from the Respondent was based solely on cost and not on any information provided by the Respondent or his employees. (Petitioner's Exhibit 10 at 13). Count V The deposition of Richard B. Divins was admitted into evidence as Petitioner's Exhibit 11. Mr. Divins' testimony parallels the other witnesses in that he also signed an application for motor club membership and a disclosure statement acknowledging the purchase and price. (Petitioner's Exhibit 11 at 11, 15, 16, 26) He purchased insurance and motor club coverage on July 13, 1979, from an employee of the Respondent at American Auto Insurance Agency, Inc., 603 NW 10th Avenue, Gainesville, Florida. (Petitioner's Exhibit 11 at 4,5) Mr. Divins thought he was purchasing only minimum liability insurance and was unaware that he had also purchased motor club coverage. (Petitioner's Exhibit 11 at 7,8) Mr. Divins is a senior in the School of Architecture at the University of Florida. (Petitioner's Exhibit 11 at 4. Count VI In Count VI, Petitioner alleges that the Respondent in the conduct of business under his license violated various provisions of the Insurance Code. Count VI requires an application of the facts found in Counts IV and V to Sections 626.9521, 626.9541 (11)(a), 626.9541(5)(a), 626.9541(15)(b) and 626.621(b), Florida Statutes. Count VI duplicates Count III and calls for legal conclusions and will therefore, be discussed in the legal conclusion section of this Recommended Order. Assuming that the witnesses who testified at the final hearing were representative of the Respondent's customers, his business was generally directed at persons who desired minimum automobile insurance coverage at the lowest possible price. (Vol. 1, T-17 and 31, Petitioner's Exhibit 11 at 7-8, Petitioner's Exhibit 10 at 8,9) An economic incentive existed to sell motor club memberships among agents whose customers desired minimum coverage due to the high commission rates associated with motor club policies. (Petitioner's Exhibit 9, Vol. 1, T-94-95, 97) Mr. Andrew Beverly was qualified as an expert witness on insurance matters and testified on behalf of the Respondent. (Vol. 1, T-29) Mr. Beverly owns the Florida Insurance School, serves as a consultant for several hundred insurance agencies and is a member of the Advisory Committee on Insurance Education of the Florida Insurance Department. (Vol. 1, T-78-79) A study by Mr. Beverly completed in 1979 for the Professional Insurance Agents Association of Florida demonstrated that insurance agents have been contacted by claimants or attorneys for claimants for failure to provide coverage or what is known in the industry as "errors and omissions." (Vol. 1, T-81-82) The Respondent is the first agent that Mr. Beverly has ever encountered who had difficulties arising from selling too much coverage. (Vol. 1, T-82-83) Mr. Beverly's conclusion concerning the value of motor club coverage and supplemental coverage generally is shared by Dr. Ronald T. Anderson, a colleague of Mr. Beverly's on the national faculty of the Society of Certified Insurance Counselors and an Insurance Commissioner of Colorado. (Vol. 1, T-83-85) In particular regard to this case, Mr. Beverly examined the application and disclosure statement signed by the witnesses for the Petitioner and responded to questions from counsel as follows: Q. Now, these documents -- if you would just take a look through those, you'll see in Respondent's Exhibits 3 and 4, I believe -- Respondent's Exhibit 1, for example, where in boldface type, the applicant for the insurance signs a statement regarding Motor Club. is that a common practice in the industry? A. It's a practice that is becoming extremely common with the careful and appropriate insurance agents to have a thorough documentation of each coverage, accepted or rejected by an injured. Q. And why is that? A. Partially because of the high incidents (sic) of Errors and Omissions insurance, claims coming in against insurance agents, and then partly so that the client himself will be completely aware of what it is that he's throwing away when he rejects a coverage so he'll know he hasn't bought that. Q. Does the type of procedure meet the standards of the industry in Florida for fire and casualty agents? A. It exceeds them. Q. Okay. What else, in your opinion, could Mr. Azis do in this type of situation other than have him sign the statements and advise him as he has testified to. A. Mr. Woods, there's nothing an insurance agent could possibly do, in my opinion, beyond explaining the coverage to the insured and then having him sign in his own handwriting. I can't believe that there is anything else that he could do. He's being as cautious as he possibly can. Q. You're not aware of any other practices or procedures that might even be better than this? A. I can't think of anything that you could do that could add to this great amount of documentation of the insurers election of what they purchased. Q. In your experience, is it common for people who have bought insurance to come back and question coverages? A. Yes, sir, it happens all the time. I have more than a hundred insurance agencies under contract at this hour, and I am constantly receiving long distance calls from agents: What do you do with this? What's the answer to it? Q. So, that's why they require the need for this documentation? A. Yes, sir. (Vol. 1, T-85-87) Mr. Beverly's testimony was not rebutted by the Petitioner and is accepted as credible. Although Respondent's license as a general lines agent in Florida expired as of August 30, 1980, he retains eligibility to become licensed for a period of two years from the date of licensure. Section 626.221(3)(f), Florida Statutes. (Petitioner's Exhibit 8)
Recommendation It is therefore RECOMMENDED that the Amended Administrative Complaint filed against the licensee, Jeffrey Allan Azis, be dismissed. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 3rd day of June, 1981. SHARYN L. SMITH Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of June, 1981. COPIES FURNISHED: Richard P. Harris, Esquire Department of Insurance 428-A Larson Building Tallahassee, Florida 32301 David Yon, Esquire Department of Insurance 428-A Larson Building Tallahassee, Florida 32301 Thomas F. Woods, Esquire 1030 East Lafayette Street Suite 112 Tallahassee, Florida 32301 =================================================================
The Issue Should discipline be imposed by Petitioner against Respondent's license as a limited customer representative (4-42), held pursuant to Chapter 626, Florida Statutes?
Findings Of Fact Facts Admitted by Answer Pursuant to Chapter 626, Florida Statutes, you, Anna Michelle Mack, currently are licensed in this state as a limited customer representative (4-42), and were so licensed at all times relevant to the dates and occurrences referenced herein. Your license identification no. is A161579. Pursuant to Chapter 626, Florida Statutes, the Florida Department of Financial Services has jurisdiction over your license and appointments. At all times relevant to the dates and occurrences referenced herein you, Anna Michelle Mack, were employed with Beck Insurance, in Jacksonville, Florida. At all times relevant to the dates and occurrences referenced herein you, Anna Michelle Mack, had a duly-appointed supervising agent, Monica Beck. Count I - Nelson Yettman On July 20, 2001, Nelson Yettman purchased mobile home homeowner's insurance from Beck Insurance. In the interest of obtaining the insurance policy he completed an application upon a form related to the Florida Residential Property and Casualty Joint Underwriting Association (FRPCJUA), Petitioner's Exhibit numbered 4. He signed the application. It reflects the signature of Monica Beck as agent, but Mr. Yettman dealt with the Respondent in the details involved with the transaction. On July 21, 2001, the only person that Mr. Yettman did business with at Beck Insurance from the beginning until the end of the transaction was the Respondent. Respondent made no explanation to Mr. Yettman as to her status as an insurance agent or not. At the time, Respondent was a limited customer representative (4-42), as she has remained. Monica Beck bound the mobile home homeowner's policy as the primary agent for Beck Insurance. On July 20, 2001, Mr. Yettman paid $377 for the mobile home homeowner's policy premium. In return Respondent provided Mr. Yettman a receipt noting that payment, Petitioner's Exhibit numbered 5. The receipt had Respondent's first name affixed. The receipt also referred to a $75 charge for "Nation Homeowners." That amount was not tendered on July 20, 2001. The reference to "Nation Homeowners" refers to a product from Nation Safe Drivers described as Homeowners/Renters contract customer service. Mr. Yettman signed for Plan 3, the $75 Plan within that service. This arrangement was one in which, according to the document, executed the agreement between the contracting parties as set forth in Petitioner's Exhibit numbered 6, was "NATION HOMEOWNERS/RENTERS PLAN agrees that the person named in the schedule made a part heheof [sic], in consideration of the payment of fee [sic] provided in paid schedule, is a nw/amed [sic] member of the NATION HOMEOWNERS/RENTERS PLAN, and entitled to all the services benefits and proviledges [sic] hereof, for and in connection with the ownership, or rental of a home or apartment in the name of the member, for the period set forth, within the United States of America, its territories, possessions, or Canada, . . . ." In particular, the services being offered were related to: Burglary & Vandalism Reward and Emblem: Nation Homeowners/Renters Plan; Extra Living Expense; Credit Card Protection; Major Appliance Allowance; Ambulance Service; Lock and Key Service; Notary Public Service; Touring and Travel Services; World Wide Tour Service; and Post Office Box. Mr. Yettman acknowledges signing Petitioner's Exhibit numbered 6, the Homeowners/Renters contract and that on July 23, 2001, he paid the $75 called for in the contract. To that end, on July 23, 2001, Respondent provided a receipt to Mr. Yettman with her first name affixed noting payment of the additional $75 Petitioner's Exhibit numbered 5. While Mr. Yettman realizes that he paid $75 for the Homeowners/Renters contract, no explanation was given to him by Respondent concerning the purchase. Mr. Yettman did not realize that it was an optional item unrelated to his mobile home homeowner's policy. He did not realize that there was an additional charge for the purchase until he paid the $377 for the mobile home homeowner's policy and was reminded that he owned an additional $75 which he eventually paid. Mr. Yettman asked what the additional $75 was for. Respondent told Mr. Yettman in response that he needed to pay another $75. Mr. Yettman went home and discussed the extra payment with his wife, and returned two days later to pay the extra $75. Mr. Yettman returned to make payment with the belief that the extra $75 was something in relation to the mobile home homeowner's insurance premium. Mr. Yettman had not read the details set forth in the Homeowners/Renters contract, Petitioner's Exhibit numbered 6. When Mr. Yettman returned on July 23, 2001, to pay the additional $75 he found out that the money was in relation to the Homeowners/Renters contract. With this knowledge he did not reject the contract at that time. Nonetheless, his overall impression remained that $452 paid in the aggregate was for a homeowner's insurance policy. As Respondent identified in her testimony, she is aware that her limited customer representative license (4-42) pertains to her opportunity to write and discuss automobile insurance. It is limited to that activity. It is unrelated to the ability to write insurance for property and casualty insurance, such as homeowner's insurance, an opportunity reserved to a general lines agent (2-20). Notwithstanding this limitation, Respondent believes that she was entitled to obtain experience while employed at Beck Insurance, under supervision leading to her licensure as a general lines agent (2-20). Respondent asserts that she was undergoing training toward that goal from Jennifer L. Faloon, a Beck Insurance employee who held a general lines agent (2-20) license. In this connection, to the knowledge of Respondent, only three or four homeowner's policies are written at Beck Insurance per month. Respondent asked Jennifer Faloon to help her in processing the application for mobile home homeowner's insurance completed by Mr. Yettman, in such matters as an item referred to as a cost estimator. Respondent wrote in the information on the application, as well as the receipts for payment that have been previously described. Respondent, in her testimony, acknowledged that the Homeowners/Renters contract was involved with items unrelated to the mobile home homeowner's insurance policy, which Mr. Yettman had come to Beck Insurance to purchase. Respondent describes the manner in which she would have presented the Homeowners/Renters contract to Mr. Yettman by telling him what it covers. "It covers the ambulance, it covers lock and key, notary, touring, covers major appliance allowance, credit cards, and stuff like that." Respondent indicated that the signature of the customer is obtained for the Homeowners/Renters contract "to let them know that they have this." This is a similar concept, as a product, to the towing and rental product sold to customer Laura Brown, whose transaction is also discussed in this case. Respondent's remarks about her description to Mr. Yettman are perceived as being what would be typical in dealing with a Homeowners/Renters contract with a customer, not specifically related to Mr. Yettman. Respondent does not recall any specific questions, which Mr. Yettman may have had about the Homeowners/Renters contract. When asked if Mr. Yettman signed the contract in her presence, she replied "Yes, Sir, he would have," meaning again that this would be the expected outcome. Respondent explained that the different plans described in the Homeowners/Renters contract are not presented to the customer by any method. Count II - Carolyn Grant On March 12, 2001, Carolyn Grant purchased automobile insurance from Beck Insurance, together with auto rental reimbursement and towing service reimbursement from All World All Safe Drivers (All World). These transactions are evidenced in applications, questionnaires, an inspection form and a receipt for payment, variously described in Petitioner's Exhibits numbered 8 through 11, and Respondent's Exhibit numbered 1. Respondent did not deal with Ms. Grant in the transactions. Count III - Laura Brown On January 21, 2002, Laura Brown purchased automobile insurance through Beck Insurance. She dealt with Valerie Webster and Anna Michelle Mack, employees at Beck Insurance. Ms. Brown dealt primarily with Ms. Webster during the transaction, with Ms. Mack there to assist Ms. Webster on and off. At various times in 2002 and 2003 Valerie Lynn Webster had applied to Petitioner to be licensed as a (2-14) life, including variable annuity agent and a limited customer representative (4-42). No licenses were issued to Ms. Webster. Before arriving at Beck Insurance, Ms. Brown had obtained a preliminary quotation by telephone from the agency related to the purchase of automobile insurance. Ms. Brown was interested in obtaining full coverage for her car. The nature of the discussion at the agency was about the purchase of automobile insurance, not about a towing and rental contract, motor club membership, or the All World plan. A down-payment was made with installments to follow, associated with the automobile insurance. Ms. Brown thought that the entire amount of the down-payment was for the insurance premium. No explanation was made to the effect that the motor club was separate from the automobile insurance policy. When Ms. Brown left the Beck Insurance agency, she did not realize that she had purchased anything other than automobile insurance. Petitioner's Exhibit numbered 12 (DOAH Case No. 03-3666PL) is the automobile insurance application through Superior executed by Ms. Brown on the date in question. It was signed by Ms. Faloon noting that the policy was bound. Ms. Faloon had no other direct involvement in the transaction. Petitioner's Exhibit numbered 13 (DOAH Case No. 03-3666PL) is a receipt dated January 22, 2002, issued to Ms. Brown by Ms. Webster and Ms. Mack, totaling $247 that Ms. Brown paid on that date. It is broken out as $184 for Superior, $60 for All World Motor Club, and $3 for a motor vehicle report. Petitioner's Exhibit numbered 14 (DOAH Case No. 03-3666PL), is an executed application for All World automobile rental and towing service reimbursement executed by Ms. Brown for a period January 22, 2002, through June 22, 2002, under Plan 3. This form does not reflect the cost of that plan. Ms. Brown executed the Beck Insurance questionnaire, Petitioner's Exhibit numbered 15 (DOAH Case No. 03-3666PL) that contains item 11 relating to the motor club stating, "I am aware that the towing and rental car reimbursement is optional. I want to carry this coverage. (This coverage can only be renewed by coming into the office, as it is not written with your auto carrier.)" This creates an option to purchase then immediately withdraws the option. The form additionally sets forth in another place, that the towing and rental car reimbursement is optional but without the opportunity to decline that option that is specifically described for other optional coverage in the form, such as uninsured motorists and medical payments. In an affidavit containing Ms. Brown's statement prepared on May 23, 2002, Ms. Brown stated, "I knew that I had purchased towing or rental reimbursement policy for my policy 1/22/2002/2003 because I saw the form and I asked questions about it. The lady in picture number 10 (Ms. Mack depicted in Petitioner's Exhibit numbered 17, DOAH Case No. 03-3666PL), told me I would get so many tows for free, she also told me it was from Beck Insurance." But in that affidavit Ms. Brown goes on to state, "I did not know that I paid an additional $60 for the towing policy. I thought this was just something I got with the car insurance policy." Nothing in Petitioner's Exhibit numbered 14 (DOAH Case No. 03-3666PL), the application for All World towing and rental reflects the cost of Plan 3. That was made known in the receipt, Petitioner's Exhibit numbered 13 (DOAH Case No. 03-3666PL). Ms. Brown does not recall whether Ms. Mack, in her participation in the transaction, indicated that Ms. Mack's status at the Beck Insurance agency was other than that of an insurance agent. Disciplinary History Respondent has no prior disciplinary history.
Recommendation Upon consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That a final order be entered finding Respondent in violation of those provisions within Counts I and III that have been referred to, dismissing the others within those Counts, dismissing Count II, suspending her license for one-year, placing Respondent on two years probation, and requiring attendance at such continuing education courses as deemed appropriate. DONE AND ENTERED this 3rd day of June, 2004, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of June, 2004.
The Issue Should discipline be imposed by Petitioner against Respondent's licenses as a general lines agent (2-20) and Florida Residential Property and Casualty Joint Underwriters Association (FRPCJUA) agent (0-17), held pursuant to Chapter 626, Florida Statutes (2001)?
Findings Of Fact Facts Admitted by Answer Pursuant to Chapter 626, Florida Statutes, you Jennifer L. Faloon, currently are licensed in this state as a general lines (2-20) agent and a FRPCJUA (0-17) agent, and were so licensed at all times relevant to the dates and occurrences referenced herein. Your license identification no. is A080736. Pursuant to Chapter 626, Florida Statutes, the Department of Financial Services has jurisdiction over your licenses and appointments. At all times relevant to the dates and occurrences referenced herein you, Jennifer L. Faloon, were employed with Beck Insurance, in Jacksonville, Florida. Additional Facts Established by Responses to Requests for Admissions Respondent was licensed as a general lines (2-20), and a Florida Residential Property and Casualty Joint Underwriters Association (0-17) agent, in Florida, from June 25, 2001, until and including the present time. From June 25, 2001, until and including February 19, 2002, Respondent was employed with Beck Insurance, in Jacksonville, Florida. Respondent signed the insurance application on February 19, 2002, to bind coverage for Ms. Wilson (Danyetta Wilson). Respondent signed the insurance application on January 21, 2002, to bind coverage for Mr. Appling (Marc Appling). Respondent signed the insurance application on January 22, 2002, to bind coverage for Ms. Brown (Laura Brown). Anna Michelle Mack transacted insurance business with Laura Brown on January 22, 2002. Respondent signed the insurance application on June 25, 2001, to bind coverage for Mr. Henderson (William Henderson). Respondent's Duties at Beck Insurance Respondent began her employment with Beck Insurance, in September 1996. She began as an unlicensed person. While working with Beck Insurance she obtained her (4-42) license allowing limited customer service related to the sale of automobile insurance. She subsequently obtained her (2-20) insurance agent license related to property and casualty, which would allow the sale of automobile, homeowners, and commercial insurance. Prior to this case Respondent has had no complaints filed against her in her capacity as insurance agent. In addition to selling insurance at Beck Insurance, Respondent is familiar with ancillary products offered through that agency. In particular, she is familiar with the sale of contracts involving towing a disabled car operated by a party who has contracted for those services. Respondent is also conversant with rental car contracts sold at Beck Insurance. The rental car contract allows for the customer to rent a car when the customer's personal car is unavailable. During the years 2001 and 2002, the years in question in this case, Respondent served as a supervisor at Beck Insurance in her capacity as a licensed (2-20) agent for persons employed by Beck Insurance, both unlicensed and licensed. The licensed agents that she had supervisory responsibility for were (4-42) limited or unlimited customer service licenses for automobile insurance and (4-40) full customer service agents. Respondent also was expected to deal with issues of underwriting for the insurance policies sold. As few as five and as many as ten agents were employed with Beck Insurance in the relevant time frame. This included another supervising (2-20) agent named Lon Woodward. Both Respondent and Mr. Woodward supervised the licensed (4-42) and (4-40) agents at Beck Insurance, who could not conduct business without supervision from the licensed (2-20) agent. The office hours in the relevant time period were from 9:00 a.m. to 6:00 p.m. Monday through Friday, and 9:00 a.m. to 5:00 p.m. on Saturday. In any given month in excess of 100 customers might be served. Not all activities in providing service were in relation to writing insurance policies. Beck Insurance, at times relevant to the inquiry, represented numerous insurance companies involved with the sale of automobile insurance. The clientele that purchased automobile insurance from Beck Insurance was principally constituted of persons with problematic driving records, including suspensions, DUIs, lapses in coverage, as well as persons who only intended to pay the minimum amount necessary for a premium to obtain insurance that would allow that person to operate a motor vehicle in Florida. As a non-standard agency, the majority of Beck Insurance customers are persons who would not be provided insurance by the standard insurance companies such as State Farm, AllState, and Nationwide. Typically, when a customer initially contacted Beck Insurance by telephone they wanted the best price. In response, the Beck Insurance employee would consider the price structure among the 35 insurance companies represented by Beck Insurance to choose the most economical policy. When telephone inquiries were made about purchasing automobile insurance through Beck Insurance no mention was made of the All World towing and rental plan. Beck Insurance trains its employees in the manner those employees will serve the customers. Respondent was included in that training, having received training and provided training in those approaches. Ordinarily when a customer inquired concerning the purchase of automobile insurance at Beck Insurance, he or she was asked about the type coverage he or she was interested in purchasing. Information was gathered concerning the automobile to be insured. A questionnaire was completed. Within that document is a reference to towing and rental car reimbursement coverage, as well as information about the automobile insurance itself. The questionnaire which was used at times relevant to this case sought information about the customer and the use of the automobile that was being considered for coverage with blanks being provided to the left of the questions for initialing by the customer and blanks to the right for an affirmative or negative response. By contrast to other items, item 11 within the questionnaire was declarative in nature. It had a space for the initials of the customer, but not one to declare acceptance or rejection of what was described. By its terms it stated: "Motor Club - I am aware that towing and rental car reimbursement is optional. I want to carry this coverage. (This coverage can only be renewed by coming into the office, as it is not written with your auto carrier)." The parenthetical reference within item 11, was by smaller type, unlike the interrogatories that were found within the questionnaire. The statement in item 11 has an internal contradiction. In its initial sentence, it talks about the optional opportunity to obtain towing and rental car reimbursement, but it is followed by a sentence which says that the customer wants to carry the coverage with no apparent opportunity within the document to decline that coverage. Moreover, at the bottom of the questionnaire, there was the opportunity for the customer to say that he or she did not want to carry and was rejecting bodily injury liability, uninsured motorist, medical payments, comprehensive and collision, and custom or special equipment coverage, by initialing the blank provided with each category of coverage, but there was no similar opportunity to reject the towing and rental car reimbursement that was described earlier in the document. The insurance coverages were referred to as optional, as was towing and rental. An example of the text within the document, aside from its execution, is found as Petitioner's Exhibit numbered 5. The execution of that document will be discussed subsequently in relation to the customer Danyetta Wilson. According to Respondent, the typical customer for automobile insurance at Beck Insurance is told "In this price we are also giving you towing and rental reimbursement." The nature of the plan for towing and rental is described. For example, if it is Plan 3, the customer is told "you will receive free tow reimbursements for six months for $100.00 each. You will also receive -- -- if you are involved in an automobile accident with another vehicle and you have to have your vehicle in a shop for repair, you will receive $25.00 a day reimbursement for five days. These claims have to be filed through our agency. You bring us the receipt within 60 days, we file it." The towing and rental services being sold by Beck Insurance, which are the subject in this dispute, are offered through All World All Safe Drivers (All World), part of Beck Insurance. Once more specific discussion is entered into concerning the automobile insurance policy applied for, the Beck Insurance employee also returns to the discussion of the All World towing and rental products. Beyond the presentation of the information concerning the purchase of the insurance coverage that has been chosen, Respondent testified that during the time in question the customer would be told "this is your towing and rental reimbursement contract." The details concerning the towing and rental in the contemplated agreement between Beck Insurance and the customer are as set forth in Respondent's Exhibit numbered 28, a form application for towing and automobile rental reimbursement through All World. The form application which constitutes the basis for providing the coverage makes no mention concerning the charge for the various plans offered to the customer for the towing and rental. The terms set forth in the application bundle the reimbursement plan for automobile rental and towing services, as opposed to separate coverage for automobile rental reimbursement and towing reimbursement. Notwithstanding the lack of explanation within the form application for All World rental reimbursement and towing service reimbursement, concerning the costs for the various plans described, Respondent indicated in her testimony that those packages are $35, $60, and $75, in costs. The discussion of the amount charged for towing and rental is included in the price breakdown that also pertains to the costs for the automobile insurance purchased. Approximately 50 percent of the customers solicited purchased All World towing and rental contracts in the time in question. Customarily, the application for automobile insurance is signed by an appointed licensed (2-20) agent at Beck Insurance who has authority to review the application to make certain that it has been correctly executed. When the transaction is complete between a customer and the Beck Insurance employee, there is but one receipt provided to the customer. That receipt sets out the aggregate charges and then breaks out individual charges for the automobile insurance policy, All World, and the motor vehicle report (MVR) fee that some insurance companies charge. As the receipt suggests, the amount tendered at the time that the automobile insurance is purchased and towing and rental reimbursement is purchased is a single amount that would have cost components for the automobile insurance, towing and rental, and a MVR fee. Another form is provided to customers with Beck Insurance. An example is found as Respondent's Exhibit numbered 27. That form outlines automobile insurance coverage by providing explanations about the types of coverage and advice on making certain that the insurance company pays claims made by the customer. There is a reference within this form to a subject other than automobile insurance, namely a reference to towing and rental-car reimbursement wherein is stated: "Reimbursement for towing charge when your covered vehicle is unable to safely proceed under its own power. Reimbursement for rental car when your covered vehicle has been involved in an accident. This coverage is optional. Consult individual plans for different payment amounts and certain restrictions that may be applied to each optional plan." As anticipated by law, persons who work for Beck Insurance, other than the licensed (2-20) agent, may take information supporting the application for automobile insurance sold through Beck Insurance. Count II Danyetta Wilson Danyetta Wilson was interested in purchasing automobile insurance in February 2002. She called Beck Insurance and spoke to Respondent concerning that purchase. After receiving a telephone quote, Ms. Wilson immediately went to Beck Insurance to transact business. The date was February 19, 2002. Before arriving at Beck Insurance, Ms. Wilson had told Respondent what she wanted in the way of automobile insurance coverage, and Respondent indicated that everything necessary to conclude the transaction would be prepared in advance before Ms. Wilson arrived at Beck Insurance. Of course, the application for insurance had not been executed, but pertinent information had been written down by Respondent on scratch paper. Essentially Ms. Wilson told Respondent in the telephone call that she wanted a minimum down-payment and low monthly payments, without discussing the amount of the deductible. When Ms. Wilson arrived at Beck Insurance, she saw Respondent. Both the Respondent and Tracy Laroe assisted Ms. Wilson in the transaction. Ms. Laroe was employed by Beck Insurance. Her application to become a licensed (4-42) limited customer representative was authorized by Petitioner on December 11, 2001. Petitioner issued license no. EO10041 (4-42) to Ms. Laroe on March 8, 2002, as recognized by Beck Insurance on March 29, 2002. As of July 1, 2002, Ms. Laroe's license was inactive based upon cancellation by Beck Insurance as the appointing entity. On February 19, 2002, Respondent was responsible for Ms. Laroe as supervisor at Beck Insurance, in relation to Ms. Wilson's transaction with Beck Insurance in purchasing automobile insurance through Progressive Insurance and automobile rental and towing reimbursement through All World. Most of the activities involved with the transaction occurred between Ms. Wilson and Ms. Laroe when addressing the purchase of automobile insurance on the date in question. During the transaction at Beck Insurance, Ms. Laroe, while assisting Ms. Wilson, did not suggest possible interest in buying the motor club also referred to as a towing and rental contract. Nor was there mention of All World as the company to provide that ancillary product. What was established in discussion was the amount of down-payment and the monthly payments for the automobile insurance. The down-payment was made by cash. Ms. Wilson was told that the down-payment would be $332, which is the amount that she paid. Ms. Wilson completed and was provided copies of certain documents in the transaction. Petitioner's Exhibit numbered 2 is the application for the automobile insurance questionnaire that was completed by providing answers and initials in relation to the underwriting information that was requested in the application form. Ms. Wilson signed the application on February 19, 2002. She did not read the document carefully because she was, as she describes it, "in a rush." The completed application was counter-signed by Respondent as producing agent on February 19, 2002, at 1:41 p.m. On February 19, 2002, Ms. Wilson was provided a receipt indicating a total amount of $332. The receipt reflected that $269 was a down-payment for Progressive Insurance, an amount of $60 as related to All World rental and towing, and $3 for a MVR fee. Ms. Wilson did not examine the receipt at the time it was provided to her. The receipt was filled out by a cashier at Beck Insurance, a person other than Respondent and Ms. Laroe. No explanation was made concerning its several parts. In addition to the questionnaire associated with the application for insurance coverage pertaining to the Progressive Insurance policy, Ms. Wilson executed the Beck Insurance questionnaire which described automobile insurance generally and the All World towing and rental. That questionnaire is Petitioner's Exhibit numbered 5. Petitioner's Exhibit numbered 5 creates the impression that towing and rental is an integral part of the purchase of automobile insurance. It was signed by Ms. Wilson on February 19, 2002, and initialed in its numbered parts. Those parts included the reference to the motor club at number 11 where it stated, "Motor Club - I am aware that the towing and rental care reimbursement is optional. I want to carry this coverage. (This coverage can only be renewed by coming into the office, as it is not written with your auto carrier.)" Again, while the towing and rental car reimbursement was stated as being optional, the quoted material was ambiguous as to its optional nature, and there was no opportunity in the latter portion of the questionnaire to specifically decline this ancillary product. In connection with the rental and towing service through All World, Ms. Wilson signed as applicant for the product. This application which formed the basis for charging Ms. Wilson $60 for rental and towing is Petitioner's Exhibit numbered 4. It is in the manner described earlier as to its form, in which no indication is made concerning the amount charged to purchase Plan 3. Ms. Wilson did not read Petitioner's Exhibit numbered 4, which described the automobile rental and towing reimbursement offered through All World. She signed her name by a red "X" on the application line. The document which described the nature of the reimbursement plan offered through All World was not specifically explained to her. Ms. Wilson was not told that there was an additional charge for the towing and rental. She had no interest in towing and rental, having been provided similar services through her cell-phone plan. In this process, Respondent came over to the location where Ms. Wilson was seated and pointed out certain places in the insurance application to check-off and initial.1 Respondent did not sit at the desk with Ms. Wilson when the transaction took place. During the transaction, Ms. Laroe told Ms. Wilson that the questions she was asking would have to be directed to Respondent, in that Ms. Laroe could not help Ms. Wilson by providing the answers. Ms. Laroe mentioned that her participation was part of the customer service. Ms. Wilson also was involved with a sheet which was informational in nature describing the various types of insurance coverage. Respondent showed Ms. Wilson that form. It is Respondent's Exhibit numbered 1, which was signed by Ms. Wilson on February 19, 2002. It indicates that Ms. Wilson declined uninsured motorists and medical payments coverage. Zeros are placed next to those explanations. Within the document is a reference to towing and rental reimbursement, wherein it is stated: Towing and Rental Car Reimbursement. Reimbursement for towing coverage when your covered vehicles are unable to safely proceed under its own power. Reimbursement for rental car when your covered vehicle has been involved in an accident and is being repaired. This coverage is optional. Consult individual plans for different payment amounts and certain restrictions that may be applied to each optional plan. The towing and rental had a dash placed by that item together with the balance of the items on the information sheet that described insurance coverage. Respondent saw Ms. Wilson place the marks by the side of the forms of coverage and the information about towing and rental reimbursement, which is not part of automobile insurance coverage as such. The overall expectation within Respondent's Exhibit numbered 1 is to generally describe available products. It does not serve as an application. The status of the document is not changed by having Ms. Wilson sign the document. Respondent saw Ms. Wilson initial item 11, concerning the motor club found within Petitioner's Exhibit numbered 5. Ms. Wilson did not ask any questions of Respondent concerning Petitioner's Exhibit numbered 5. Respondent was present when Ms. Wilson signed the application for towing and rental, Petitioner's Exhibit numbered 4. Respondent in relation to that document asked if there were any questions. Ms. Wilson did not indicate that she had questions. In relation to Petitioner's Exhibit numbered 4, Respondent recalls the nature of the explanation that she gave to Ms. Wilson as: "What this is, is this is your towing and rental contract. It gives you three tows per six months, $100.00 reimbursement on every tow, on each tow with a limit of three per six months. The rental benefit is $25.00 a day for five days if you are involved in an automobile accident and you need reimbursement. All claims have to be brought here to the office within 60 days in the form of receipts. We file the claims for you. Now, I need you to sign there." Nothing in that explanation indicates that there was an opportunity to decline to participate. The explanation did not establish the cost for the plan. Respondent indicated hat Ms. Laroe in her participation in the transaction with Ms. Wilson was there to listen and learn. Count III Marc Appling On January 21, 2002, Marc Appling purchased automobile insurance from Beck Insurance. He wanted full coverage for his car. The amount quoted for the insurance as a down-payment was $288. On January 21, 2002, $200 was paid. On January 24, 2002, the additional $88 was paid. Of the $288 paid, $222 was a down- payment for automobile insurance through Superior American Insurance Company (Superior), $60 was for All World automobile towing and rental reimbursement, $3 for a MVR fee, and $3 for some unexplained charge. The receipt provided Mr. Appling when he paid the initial $200 reflects $222 for down-payment to Superior, $60 for All World, and $3 for a MVR fee. That receipt is Exhibit numbered 9 to the Appling deposition, Petitioner's Exhibit numbered 16. On January 21, 2002, Mr. Appling primarily dealt with Lance Moye, an employee of Beck Insurance who gave him a price quotation for the purchase of insurance through Superior. Mr. Moye explained to Mr. Appling the details, to include the amount of payment per month beyond the down-payment. Michelle Mack, an employee for Beck Insurance was sitting next to him. If Mr. Moye experienced problems in carrying out the transaction, he would ask Ms. Mack her opinion. Mr. Moye has never been licensed by the Petitioner in any capacity. During 1991 and 1993, he had applied for a (2-20) general lines property and casualty license. On the date in question, Michelle Mack, known to Petitioner for licensing purposes as Anna Michelle Mack, was licensed as a (4-42) limited customer representative agent. Mr. Appling executed the Beck Insurance questionnaire and acknowledgement form that has been previously described, to include initialing item 11, related to the motor club which says: "I am aware that the towing and rental car reimbursement is optional. I want to carry this coverage. (This coverage can only be renewed by coming into the office as it is not written with your auto carrier.)" This form that was signed and initialed and answered yes or no in various places was Exhibit numbered 8 to the Appling deposition, Petitioner's Exhibit numbered 16. Mr. Moye told Mr. Appling that "you pay," addressing Mr. Appling, "X amount of dollars for rental car coverage and everything like that." However, Mr. Appling was not satisfied with the explanation. The questionnaire Exhibit numbered 8 to the Appling deposition, describing towing and rental car reimbursement as optional, did not create below that statement the specific opportunity to decline that option as would have been the case as items such as uninsured motorist and medical payments. Mr. Appling was left with the impression that the motor club was part of the insurance policy that he purchased and that the $288 down-payment included the motor club. Because Mr. Appling was interested in full coverage, he believed that the automobile insurance itself would cover rental reimbursement. Notwithstanding that the form questionnaire, Exhibit numbered 8 to the Appling deposition referred to towing and rental car reimbursement as an optional item, Mr. Appling did not understand that it was an optional purchase. Had he been persuaded that it was a separate item he would not have purchased the motor club. Exhibit numbered 7 to the Appling deposition, Petitioner's Exhibit numbered 16, is the application for All World towing and rental reimbursement. The automobile insurance application through Superior is found as Exhibit numbered 5 to the Appling deposition, Petitioner's Exhibit numbered 16. It was executed and signed by Mr. Appling on the date in question, then was marked as bound and signed by Respondent on that date. Although Respondent signed the Appling application for automobile insurance with Superior, she had no specific recollection of the event and was not otherwise involved in the transaction. Count IV Laura Brown On January 21, 2002, Laura Brown purchased automobile insurance through Beck Insurance. She dealt with Valerie Lynn Webster and Anna Michelle Mack, employees at Beck Insurance. At various times in 2002 and 2003, Ms. Webster had applied to Petitioner to be licensed as a (2-14) life, including variable annuity agent and a limited customer representative (4-42). No licenses were issued to Ms. Webster. Before arriving at Beck Insurance, Ms. Brown had obtained a preliminary quotation by telephone from the agency related to the purchase of automobile insurance. Ms. Brown was interested in obtaining full coverage for her car. The nature of the discussion once Ms. Brown arrived at the agency was about the purchase of automobile insurance, not about a towing and rental contract, motor club membership or the All World plan. A down-payment was made with installments to follow, associated with the automobile insurance. Ms. Brown thought that the entire amount of the down-payment was for the insurance premium. No explanation was made to the effect that the motor club was separate from the automobile insurance policy. When Ms. Brown left the Beck Insurance agency, she did not realize that she had purchased anything other than automobile insurance. Petitioner's Exhibit numbered 12 is the automobile insurance application through Superior, executed by Ms. Brown on the date in question. It was signed by Respondent, noting that the policy was bound. Respondent had no other direct involvement in the transaction. Petitioner's Exhibit numbered 13 is a receipt dated January 22, 2002, issued to Ms. Brown by Ms. Webster and Ms. Mack, totaling $247 that Ms. Brown paid on that date. It is broken out as $184 for Superior, $60 for All World, and $3 for a MVR fee. Petitioner's Exhibit numbered 14 is an executed application for All World automobile reimbursement and towing service reimbursement executed by Ms. Brown for the period January 22, 2002, through June 22, 2002, under Plan 3 in the form that has been previously described. As reflected in Petitioner's Exhibit numbered 15, Ms. Brown executed the Beck Insurance questionnaire in the form that has previously been described that contains item 11, relating to the motor club stating, "I am aware that the towing and rental car reimbursement is optional. I want to carry this coverage. (This coverage can only be renewed by coming into the office, as it is not written with your auto carrier.)" The questionnaire additionally sets forth that the towing and rental car reimbursement is optional but without the opportunity to decline that option that is specifically described for other optional coverage in the form, such as uninsured motorists and medical payments. In an affidavit containing Ms. Brown's statement prepared on May 23, 2002, Ms. Brown stated, "I knew that I had purchased towing or rental reimbursement policy for my policy 1/22/2002/2003 because I saw the form and I asked questions about it. The lady in picture number 10 (Ms. Mack depicted on Petitioner's Exhibit numbered 17) told me I would get so many tows for free, she also told me it was from Beck Insurance." But in that affidavit Ms. Brown goes on to state, "I did not know that I paid an additional $60 for the towing policy. I thought this was just something I got with the car insurance policy." Again, nothing in Petitioner's Exhibit numbered 14, the application for All World towing and rental, reflects the cost of Plan 3. That was made known in the receipt, Petitioner's Exhibit numbered 13. Count V William Henderson On June 25, 2001, William Henderson purchased automobile insurance from Beck Insurance. He dealt with Daphne Ferrell, a person Respondent claims was a licensed agent at the time. No proof has been presented to contradict Respondent's position, and it is found that Ms. Ferrell was a licensed agent when the transaction took place. On the date in question, Mr. Henderson was interested in purchasing full coverage for his automobile. He executed an application with Atlanta Casualty Company (Atlanta Casualty) to purchase the automobile insurance. That application is Petitioner's Exhibit numbered 6. Respondent's involvement in the purchase was the signing of the application in the place indicated for the agent's statement vouching for the application's correctness. The automobile that was covered by the purchase was inspected by Ms. Laroe as evidenced in Petitioner's Exhibit numbered 7. The inspection was not a function that required a licensed person to perform. Mr. Henderson paid Atlanta Casualty $306 on June 25, 2001, for automobile insurance. That payment is reflected in Petitioner's Exhibit numbered 8, a copy of the check written to Atlanta Casualty. The money that was paid was acknowledged by a receipt from Ms. Ferrell dated June 25, 2001, Petitioner's Exhibit numbered 9. That receipt reflects $306 down-payment for the automobile insurance to Atlanta Casualty and $75 for a rental contract involved with All World, for a total of $381. Whether Mr. Henderson paid the $75 for towing and rental, aside from the $306 check written for the insurance to Atlanta Casualty, is not clear from the record. Mr. Henderson had made application on the form related to All World for auto rental reimbursement and towing service reimbursement, which has been previously described. The specific application by Mr. Henderson is Petitioner's Exhibit numbered 10, relating to Plan 3. Mr. Henderson executed the Beck Insurance questionnaire form that has been previously described setting forth item 11, the motor club, which states: "I am aware that the towing and rental car reimbursement is optional. I want to carry this coverage. (This coverage can only be renewed by coming into the office, as it is not written with your auto carrier.)" While Mr. Webster initialed item 11 on the form, as other customers had done in the circumstances addressed in the Administrative Complaint, the form he executed, as with other customers, did not create an opportunity to opt out of the motor club. While the form at item 11 spoke of the optional nature of the motor club, it was followed by a statement that made it appear that the opportunity to decline the coverage had already been determined, when it said: "I want to carry this coverage." The reference to the optional nature of the towing and rental car reimbursement in the latter portions of the form was not followed by an opportunity to specifically decline the motor club, as allowed in reference to other forms of optional insurance coverage pertaining to such items as uninsured motorist and medical payments, for example. The executed questionnaire is Petitioner's Exhibit numbered 11. In completing the Beck Insurance questionnaire, Petitioner's Exhibit numbered 11, his instructions were to initial where the solid arrow runs from items 1 through 14, at the top of the page, and by the Xs at the bottom of the page. The arrow and the Xs were placed by someone other than Mr. Webster. Only a brief explanation was given to Mr. Webster concerning the questionnaire. Mr. Webster has no recollection of someone specifically reading item 11, related to the motor club. During the transaction at issue, Mr. Webster remembers a discussion of towing and rental. He indicated that he was not interested in rental reimbursement. He did want towing. Mr. Webster, like the other customers who have been discussed, did not carefully read the documents presented to him for his consideration in purchasing the automobile insurance and in relation to the motor club. Mr. Webster has a vague recollection of someone placing an "X" on the applicant's signature line in Petitioner's Exhibit numbered 10 and signing that application for the All World motor club, but he thought that he was only purchasing towing not rental. The application covers both rental and towing.
Recommendation Upon the consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That a Final Order be entered finding Respondent in violation of those provisions within Count II that have been referred to, dismissing the others within that count, dismissing Counts III through V; suspending Respondent's licenses for nine months, placing Respondent on two years' probation and requiring attendance at such continuing education courses as deemed appropriate. DONE AND ENTERED this 3rd day of June, 2004, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of June, 2004.
Findings Of Fact Charles Edward James in the relevant period of time considered by these proceedings was an insurance agent licensed by the State of Florida in the categories of ordinary life, general lines, and disability. In that same time period Respondent was the president, director, and registered agent for Friendly Auto Insurance of Panama City, Inc., located at 704 West Eleventh Street, Panama City, Florida. He was also the president, director, and registered agent of All Auto Insurance of Quincy, which operates from 101 East Jefferson, Quincy, Florida. At various times in the critical period, Respondent had five other employees in Panama City in the Friendly Auto Insurance Agency. Among those employees was Alton McCollum, Jr., a licensed general lines agent in the State of Florida. His tenure with the Panama City office was from approximately February or March, 1982, until April, 1983. Anita Prevost worked in the Panama City operation commencing August, 1981, and was employed at the time of hearing as the office manager. Michelle Tolden started working in the Panama City office in February, 1982, as a clerk. At the time of the hearing she was excused from her employment on maternity leave. Tina Clark worked as a clerk in the Panama City office, but resigned prior to the hearing date. Carmen Browning was an employee in the business whose length of employment is unknown. McCollum, as a licensed general lines agent, had been hired by Respondent to operate the Panama City office and allow Respondent to do business in Quincy. At the time James employed McCollum, he gave no specific instructions as to how McCollum would supervise the Panama City office. James basically told McCollum that he wanted McCollum there so that McCollum's agent's license could be utilized to allow the Panama City office to remain open. McCollum spent a couple of hours a day operating the office. His time was primarily devoted to review of applications received by office employees. When he was not available in the office, McCollum could be contacted by phone by other office personnel. When he arrived, he assumed that the employees who were not agents understood how to conduct the business in the sense of giving quotes for automobile insurance over the phone and filling out the necessary forms. In the beginning, he was not familiar with the sale of motor club benefits, having never worked with that type of offering. The motor club memberships that were being sold at the time that McCollum was serving as the agent for Friendly Auto called for commissions to Friendly in the amount of 70 to 80 percent of the premium. Eventually, McCollum determined that the motor club sales through the Panama City operation were questionable. He discovered that customers were not being told that they were getting a motor club membership in addition to their requests for basic automobile insurance. In effect, what he found was that the other employees in Respondent's Panama City office were quoting a single price to customers requesting basic automobile insurance which included the cost of the basic insurance premium and the price of membership in the motor club. As McCollum realized motor club is not part of basic automobile insurance coverage in Florida. McCollum then attempted to have other employees within the Respondent's office specify to customers the particulars of what they were receiving, i.e., that motor club memberships were separate from automobile coverage. He also instructed the other employees in selling motor club memberships to explain to the customers that they were purchasing a motor club membership and specifically indicate what the cost was of that plan. As a result, Friendly Auto sold fewer auto club memberships while under the supervision of McCollum. McCollum also discovered that the other employees in the Panama City office were inappropriately filling out the applications in the sense that the name, address, driving history, and other background information were filled out but that portion related to premium costs and the break out of those costs was not being completed at the time the customer was in the office. That information was being placed in the application at a later date. The normal procedure was for the customer to be provided with a copy of the application which did not contain the specific itemized costs related to premium payments. Once McCollum discovered the problem with the applications, he instructed the employees in the office to fill out the application forms completely to include specifying the premium costs in the application and providing the customer with a completed copy of the application to include a break out of these premium charges. Tina Clark in particular did not readily accept the suggested changes for improving the integrity of the operation. McCollum had suggested that James fire this employee. Instead, Respondent decreased the hours available for that employee to work in the office based upon his belief that she would leave voluntarily and the employee left several months later, indicating that she could not accept reduced hours of work. Anita Prevost was hired by Respondent and trained by Carmen Browning. Before McCollum's involvement with the Panama City office, Prevost, in taking applications for automobile insurance, would quote a cost which included motor club membership as well as the automobile premium costs, even if the customer simply requested insurance necessary to receive a license and tag for an automobile. At the time of filling out the automobile insurance form it would be signed, the motor club membership application form would be signed, and a rejection form related to coverages not requested in the automobile policy line would be signed. Prevost and other employees would not refer to the motor club membership by that name. Instead, at most benefits of the motor club membership would be explained, such as towing, rental reimbursement, accidental death benefits, and emergency road service. The idea of explaining the coverage and not referring to the motor club membership as such was that of the Respondent. When an individual discovered that they had purchased a motor club membership, Prevost and other employees per Respondent's instructions would provide a full refund of the membership costs to that customer. Prevost, and other employees, in dealing with PIP coverage routinely filled out a deductible in the amount of $8,000 after asking a customer if they had hospitalization and without regard for the customers' response. When confronted with a customer who was not interested in that amount of deductible, they would offer a lesser deductible or no deductible. This technique was in keeping with instructions given by Respondent. Later, in dealing with the PIP purchase, Prevost and other employees in the agency would ask if the customer had hospitalization. If they said yes, an $8,000 deductible PIP would be suggested; otherwise, it would be recommended that the customer purchase the PIP coverage that did not carry a deduction. This new policy was established by the Respondent in early 1982 but was not always adhered to as seen in subsequent facts. When Michelle Tolden took applications for persons who wanted basic automobile insurance, she explained the limits of liability in the coverage; coverage related to PIP and its limitations and the benefits related to motor club memberships to include road service, rental, towing reimbursement and any accidental death benefits. The words "motor club" were not mentioned and Tolden has not deviated from the practice from this decision not to mention motor clubs. She feels that the customer understands better what is involved without mentioning the term "motor club." This technique is contrary to the instructions given by McCollum. Tolden, prior to her maternity leave, dealt with the question of the sale of $8,000 deductible PIP in the same fashion as described in the facts related to Prevost. Respondent, in his training in Port Myers, Florida, prior to coming to Panama City, had utilized the technique of packaging minimum automobile insurance coverage necessary with a ¬or club membership when a customer sought "tag" insurance. He and his employees pursued this technique at the time he operated as the general lines agent with Friendly Auto from June 1981 to March 1982. This packaging did not tell a customer specifically that the customer was purchasing an unnecessary and unrequested motor club membership. The resulting confusion and deception related to the aforementioned packaging is seen in the following factual account related to select customers mentioned in the complaint. According to James, in selling PIP $8,000 deductible the realized return was $3.00 with a cost of service of between $20 and $25. As a consequence, he decided to package automobile coverage and the motor club membership in view of the fact that the motor club paid 70 percent or better as commission for the agency in the sale of memberships. This enabled the agency to realize a profit in the combination of the sale of minimum automobile coverage and motor club memberships. The average return for commissions on automobile insurance policies generally is 15 percent. COUNT I LINDA C. SMITH In May, 1982, Linda C. Smith went to Respondent's Panama City office to purchase the necessary automobile insurance to obtain a tag. Smith desired to have PIP and liability coverage; however, in the face of a quoted cost of $79 for the insurance, she determined that she could only afford PIP. She paid $79 for what she assumed was PIP coverage upon a quote of that amount by an employee in Respondent's office. Only $29 related to automobile insurance coverage, the balance was for motor club membership. No mention was made to Smith on the subject of the purchase of a motor club membership and Smith would not have purchased it in view of the fact that she had a friend who was in the wrecker business. That friend was Robert Griffiths. Smith did sign a slip pertaining to a motor club membership which may be found as Petitioner's Exhibit 8. She does not remember seeing the membership fee of $50 reflected on that form. Subsequently, Smith discovered that she had purchased a motor club membership. Had she realized that the $50 had been spent on motor club membership, she would have utilized that payment to purchase liability insurance in lieu of the motor club membership. After complaining to the Insurance Commissioner's office in Panama City, she was contacted by Friendly Insurance and received a $50 refund related to her purchase of a motor club membership. At the time of the transaction, Smith did not read the entire explanation on documents provided to her. Smith's determination to purchase the no fault deductible in the amount of $8,000 was on the basis of the signing of a form provided by the agency which is known as a rejection of liability coverages. The particular form in question may be found as Respondent's Exhibit 11, admitted into evidence. Smith does not recall checking the block which shows the $8,000 deductible PIP. Nonetheless, one of he items on that form related to the $8,000 deductible and it indicates the significance of the deductible, in that it reduces the amount of PIP benefits paid to the purchaser or resident relatives. The form also indicates that this kind of deductible is not recommended for those persons who do not have other coverages which would respond adequately to payments for injuries received in automobile accidents. In addition to this information, the employee who assisted the customer had asked about hospitalization for the benefit of Linda Smith. Smith did have health insurance or medical insurance at the time of purchasing the automobile insurance policy. In addition that form as signed by Smith, had a portion which stated "I understand the accidental death benefit through the life insurance company is a separate item, that pays in addition to my auto insurance policy. I understand the additional charge to this coverage is included in with my downpayment." Smith did not equate this latter item with motor club membership. COUNT II JACKIE MERCER Jackie Mercer went to the Panama City office of Respondent in order to purchase necessary insurance to obtain a driver's license. This explanation was made to the employee who assisted the customer at Friendly Auto. The amount of quotation for the premium was $581, which was paid by Mercer. An automobile insurance application form was signed by Mercer and a copy of that may be found as Petitioner's Exhibit No. 13 admitted into evidence. The coverage was for one year, commencing April 17, 1982. No mention was made to Mercer of the purchase of a motor club membership and Mercer would not have knowingly accepted that unsolicited membership. Nonetheless, as part of the package of coverage, $25 was charged for each of two vehicles that were being insured for a total of $50 for membership in a motor club. The real automobile insurance policy amounts for the two cars for the one year period was $531. At the time that the purchase was made, Mercer did not understand that he had paid a separate amount for motor club, notwithstanding signing two forms which are constituted as Petitioner's composite Exhibit No. 15 indicating application for motor club membership. Mercer has no recollection of signing the forms related to motor club. Mercer spent 10 to 15 minutes in the office in applying for the insurance coverage and did not read the various documents presented to him in applying for the insurance. As related in Respondent's Exhibit No. 6, Mercer signed that aspect of the rejection of liability coverages pertaining to the fact that accidental death benefits were a separate item from the overall automobile insurance coverage for which there was an additional charge. This related to the motor club membership benefits; however, Mercer was unaware of this. The automobile insurance application, Petitioner's Exhibit No. 13, does not break down the various charges related to premium payments for insurance for the two automobiles. On the other hand, the application which was presented to the insurance company and is found as part of Petitioner's Exhibit No. 14, dated April 16, 1982, carries a quotation for the total premium payments for both cars as being $431. Eventually, Mercer was notified of the cancellation of his coverage with Protective Casualty related to the two automobiles for reason of nonpayment of additional premium. It was at that time that he learned from the Florida Department of Insurance that the overall charge of $581 made by Respondent's Panama City operation included $50 for motor club memberships which were not desired by Mercer. COUNT III RENATA DOTSON On October 26, 1981, Renata Dotson went to the Panama City office of Respondent and purchased automobile insurance by dealing directly with the Respondent. She told James that she wished full coverage and paid the $289 quoted price with the expectation of receiving six months' coverage for automobile insurance. She did not wish to purchase motor club membership which is not part of automobile insurance. The cost of auto coverage was $214. Petitioner's Exhibit No. 17, entered into evidence is a copy of the application form which was used in requesting insurance from Colonial Insurance Company This item was not filled out by Dotson. She did sign the document on the second page. Ms. Dotson did not obtain a copy of the original of the application form upon leaving the agency. Dotson also signed an application for membership in the Nation Motor Club. A copy of that application may be found as Petitioner's Exhibit No. 20, admitted into evidence. She did not fill out the other information set forth on the form. At the time of requesting automobile insurance on October 26, 1981, through James' agency, in addition to not requesting to join a motor club, she recalls no discussion of joining a motor club. She would not have desired membership in the Nation Motor Club because her parents were involved in another motor club that to her understanding would cover her car. Dotson did not understand that she had signed an application for a motor club membership. Likewise, Dotson does not recall the discussion of an $8,000 deductible PIP which eventually was written into the policy or any other discussion related to deductibles. Dotson did not carefully read all papers presented to her at the time she was in Respondent's office on October 26, 1981. Dotson later discovered that she had paid $75 for motor club membership and upon that discovery, Friendly refunded her $75. As reflected in Respondent's Exhibit No. 4, Dotson signed that aspect of the rejection of liability coverages dealing with accidental death benefits and the fact that this was a separate item promoting an additional charge for coverage. She did not equate this as being unrelated to automobile insurance requested by her and related to purchase of a motor club membership. Her understanding was that the questions related to naming a beneficiary for the accidental death benefit was part of the purchase of the automobile insurance. COUNT IV EMMETT FOWLER Emmett Fowler was interested in obtaining less expensive automobile insurance that he presently held and based upon a television advertisement, he purchased automobile insurance from Friendly Auto in Panama City. When he bought the insurance, he was of the opinion that he had paid for a full year when in fact he had paid for six months' coverage. When inquiring about this misunderstanding, it was revealed that he had purchased motor club membership. He had not understood that he had purchased that membership prior to this subsequent inquiry and would not have desired the membership in that he had been a member of another motor club for fifteen years. He was reimbursed $50 for the motor club membership when he informed Friendly that he was not interested in that benefit. The actual automobile insurance premium was $52 and he had paid $102 which had been quoted as the price of automobile insurance. The other $50 was for motor club membership. Fowler had signed the application for the automobile policy, a copy of which is found as Petitioner's Exhibit No. 26 and for the motor club membership, a copy of which is Petitioner's Exhibit No. 28. At the time of purchasing the policy, no discussion was entered into on the question of purchase of a motor club membership. The employee who assisted Fowler in the purchase of the automobile insurance indicated that in view of the fact that Fowler had retired from the military, that the $8,000 deductible on personal injury protection would make the policy cheaper. Having heard this explanation, Fowler chose an $8,000 deductible PIP. The total time involved in the purchase of the automobile insurance was 10-15 minutes. Fowler did not read the documents presented to him in this session very carefully. At the time of purchase, accidental death benefits were discussed; however, Fowler was unaware that this matter pertained to motor club membership and not the insurance policy. Fowler also signed the rejection of liability coverages form which is Respondent's Exhibit No. 7, admitted into evidence. In particular, his signature appears on that portion of the form related to the fact that accidental benefits are a separate item and that there is an additional charge for that coverage. The motor club application which is Petitioner's Exhibit No. 28, does not reflect the fact of the $50 fee related to that membership. A copy of that application produced by the Respondent from his records which is admitted as Respondent's Exhibit No. 8, shows a charge of $50. The conclusion of fact to be drawn from this discrepancy is to the effect that the $50 was placed on the application form subsequent to the time that Fowler made application and without his knowledge. COUNT V MAXIE REEDER On June 4, 1982, Maxie Reeder made an application with Friendly Auto, Panama City, for automobile insurance and paid the $200 which had been quoted as the price of the insurance. Of that $200, $175 actually pertained to the automobile insurance premium and the remaining $25 paid for membership in a motor club. Reeder purchased the insurance based upon a need to have sufficient insurance to obtain a tag for her automobile. Reeder was unaware that she had purchased a motor club membership until she received notification of her membership from the motor club. Reeder also experienced problems with trying to gain benefits of her automobile insurance coverage in that she had difficulty gaining assistance from the Respondent following an automobile accident that she had in late June. The automobile policy was not received by Reeder until August 1982. Eventually, Reeder cancelled the automobile insurance policy. She requested that Friendly Auto provide her a refund for the motor club and received a refund in the amount of $25. Petitioner's Exhibit No. 30 is a copy of the application for automobile insurance which was signed by Reeder on June 4, 1982. It does not reflect the exact cost of the various elements of the automobile insurance policy premium. Those premium amounts are broken out on Petitioner's Exhibit No. 31, which is a copy of the application as completed by someone in the Friendly Auto Insurance Agency and submitted to the insurance company after Reeder left the agency. It reflects the various charges and the total charge of $175. Through this scheme of completing the form later, Reeder was not aware that the full amount of the automobile insurance was $175, not the $200 quoted, nor did she recognize that the remaining $25 of the money that she paid was for motor club membership. Reeder would not have knowingly joined an automobile motor club because she was not financially able. The transaction for the purchase of the automobile insurance on June 4, 1983, took approximately 45 minutes and the customer did not read the documents involved carefully. Reeder was eventually paid $140 related to the automobile insurance premium which represented the amount of premium not yet used at the point of her cancellation. As reflected in Respondent's Exhibit No. 9, admitted into evidence, Reeder signed that portion of the rejection of liability coverages referred to as the accidental death benefit separate item and the fact of additional charge for that coverage. Notwithstanding that signature on the rejection of liability coverage, Reeder and all other customers in this complaint did not understand the separate nature of the automobile insurance coverage and the motor club membership. Moreover, nothing that was done by the employees at Friendly Auto had as its purpose explaining the meaning of the aforementioned statement signed by the customer and the fact that the automobile club membership was not necessary in order to obtain the so-called tag insurance. In the Reeder transaction and the others, even in the face of a separate application for motor club membership and automobile insurance and the purported identification of the separateness of automobile insurance and motor club membership found in the rejection of liability coverage form signed by the customer, the overall technique used in responding to the customer's request for automobile insurance was one of obscuring the distinction between automobile coverage and motor club membership. Actions by Respondent and his employees in dealing with Reeder and the other named customers camouflaged the fact that motor club membership was not necessary to meet the requirements of law for the purchase of a tag. By these actions, Respondent and employees at Friendly Auto were making a misrepresentation to the public related to necessary coverage for obtaining automobile tags and the cost of automobile insurance and motor club membership. COUNT VII ROBERT GRIFFITHS Based upon advertising, Robert Griffiths went to the Friendly Auto to purchase full automobile insurance coverage. This visit was on February 12, 1982. At that time, he paid Friendly Auto in Panama City $168 for what he was led to believe was automobile insurance coverage requested. The copy of the application made on February 12, 1982, may be found as part of composite Exhibit No. 72 by the Petitioner. It does not reflect the exact charges related to the automobile insurance. This is a copy which was obtained by the Griffiths when they purchased the insurance. In actuality, the cost of the insurance was less than $168 paid. Griffiths signed an item requesting an application for membership in Nation Motor Club which is part of Petitioner's composite Exhibit No. 40 admitted into evidence. Notwithstanding the fact that he signed this application form, he did not understand that he had purchased a motor club membership and would not have desired that in that he operated a wrecker and would not need the towing service provided by the motor club membership. At the time of purchase of automobile insurance in February, 1982, Mr. Griffiths and his wife thought that the motor club membership was part of the automobile insurance without charge, in that the copy of the application which was received did not indicate a membership fee. This is seen in a xerox copy of the membership application which is part of composite Exhibit No. 40 as contrasted with the agency's yellow copy of the membership application and part of the composite Exhibit No. 40. The latter item contains a $25 membership fee. It is concluded that the fee quote was placed on the application form submitted to the Nation Motor Club at a time subsequent to the Griffiths' departure from Friendly Auto on the date in February, 1982. Moreover, Petitioner's Exhibit No. 73 is a copy of the basic service contract for the motor club which was received by the Griffiths and the fee amount is whited out further leading the Griffiths to believe that there was no charge for that coverage. There was no discussion on February 12, 1982, between the employee of Friendly and Griffiths on the question of joining a motor club. In the February application process, when Robert Criffiths signed the motor club membership application form and the application for insurance he did not read those matters carefully. Griffiths also signed the rejection of liability coverage acknowledgement form, Respondent's Exhibit No. 10, admitted into evidence, related to separateness of the accidental death benefit and the additional charge for that coverage. Griffiths, in asking for full insurance coverage did not wish to have the $8,000 deductible PIP at the time of purchasing insurance in February. The automobile insurance protection which was requested on the application was shown to be worth $153 and the actual policy amount was finally determined by the insurer to be $150 including the policy fee. This is reflected in Petitioner's Exhibit No. 39, admitted into evidence which is a copy of the application for insurance policy and the statement of policy declarations. The period of coverage was for six months commencing February 13, 1982. In August, Griffiths returned to Friendly Auto Insurance to renew the automobile insurance policy. On this second visit, Griffiths' wife was with him and she concluded the transaction and Griffiths returned to work. When the application for renewal was applied for in August, 1982, and Mr. Griffiths left, he left after revealing to the employee at Friendly that his duties included that of operation of a wrecker. On this second visit in August, 1982, no discussion was entered on the question of continuing the $8,000 deductible PIP which had been purchased at the time that the automobile insurance was obtained from Friendly in February, 1982. Had Mrs. Griffiths known, she would not have applied for an $8,000 deductible PIP at the time of renewal, acting in her husband's absence. She did not feel that she could afford to pay the $8,000 deductible if the insurance was needed. In addition, the automobile insurance policy renewal was not promptly forwarded to the insured even though application was made on August 17, 1982. As a consequence, when Mrs. Griffiths had an accident on August 20, 1982, she was not covered by the policy. The problem with lack of coverage of the accident on August 20, 1982, and the deficit in the coverage related to PIP were rectified by Friendly and the motor club fee was returned. COUNT VIII BRENDA D. HENDERSHOT/BRUMFIELD On January 15, 1982, Brenda Hendershot, now Brumfield, looked the Friendly Auto Insurance Agency up in the phone book and through the telephone process received a quote for insurance and decided to purchase automobile insurance to obtain an automobile tag. The purchase price quoted of $153 included motor club membership, unknown to the customer. Petitioner's Exhibit No. 44, admitted into evidence, is a copy of the application for automobile insurance. It does not reflect a break down of the cost related to the policy, although there are spaces provided for those entries. This document was signed by Brumfield at the time of applying for the policy at the Respondent's office in Panama City. That exhibit is a copy of what was given to Brumfield when she left Respondent's office. Anita Prevost was the employee who took care of Brumfield on the date the automobile insurance was purchased. During this purchase no discussion was made of the motor club. Brumfield did sign the Nation Motor Club application form that is depicted as Respondent's Exhibit No. 2. In addition, she signed the rejection of liability coverage provided by Friendly, to include that portion of the form related to accidental death benefits, being a separate item carrying an additional charge. As with other cases spoken to in this Recommended Order, the accidental death benefit was part of the motor club membership and not part of the automobile insurance coverage requested by Brumfield. Brumfield recalls some discussion about $8,000 related to personal injury protection but did not understand from this conversation at the time of purchase that this $8,000 amount pertained to a deductible. She did not discover this fact until a subsequent time. On that same occasion, Brumfield discovered that she had purchased a motor club membership which she did not request. The copy of the application for insurance which the Respondent's agency in Panama City submitted to the insurance company as shown through Petitioner's Exhibit No. 45, admitted into evidence, reflects the various charges set forth in the premium and demonstrates that the real cost of the automobile insurance was $128 with the other $25 being related to motor club membership. The customer did not carefully consider documents by reviewing them at the time of her purchase. COUNT IX BENNY L. COON On December 31, 1981, Benny Coon went to Friendly Auto Insurance to purchase the necessary automobile insurance to satisfy legal requirements in the State of Florida. He chose this agency because it was the nearest to his residence. A quotation was made to him of $158 and he paid $158 for what he understood to be the necessary automobile insurance coverage. This quote, unknown to Coon, contained motor club charges. A copy of the application form, for automobile insurance which contains his signature, may be found as Petitioner's Exhibit No. 49, admitted into evidence. Coon's also signed an application for Nation Motor Club as shown in Petitioner's Exhibit No. 52, admitted into evidence which is the copy kept by Friendly insurance. As reflected on that exhibit, $25 was charged for motor club membership unrelated to the automobile insurance requested by Coon. Coon had not requested to join a motor club when be went to the agency, not being interested in that plan, and there was no discussion made about joining the motor club. Eventually, Coon received a copy of the declaration statement related to the automobile policy and it reflected the true charge of $133 as opposed to the $158 which Coon paid, believing that was related to the cost of automobile insurance not automobile insurance and motor club membership. Petitioner's Exhibit No. 50 is a copy of the application submitted to the insurance company and it also shows charges in an amount of $133. The break out of the charges for the automobile insurance was not reflected on the copy of the application provided to the customer on the date he made that application. See Petitioner's Exhibit No. 49. Coon had not carefully read the documents prepared at the time of requesting insurance coverage. Again this customer completed the rejection of liability coverages form which is found as Respondent's Exhibit No. 5 admitted into evidence. He signed that aspect of the form related to accidental death, i.e. death benefit being a separate item and the additional charge related. COUNT XI DAVID B. PERMENTER David Permenter went to the Friendly Auto Insurance office in Panama City on March 15, 1982, to purchase basic automobile insurance coverage required by the State of Florida. He was quoted a price with a premium of $346 and he paid that price. This price included motor club membership without his knowledge. At the time the application was made, he signed a form related to membership in Nation Motor Club and was provided the customer's copy. This is found as Petitioner's Exhibit No. 63, admitted into evidence. It does not reflect the amount of charge for this protection. He also executed an application form related to the automobile insurance, a copy of which is found as Petitioner's Exhibit No. 60. This item does not display the break out of the cost related to the automobile insurance which ultimately was determined to be $321 with the balance of the amount he paid being $25 utilized for membership in Nation Motor Club. The declarations document related to the automobile insurance policy was received by the customer subsequent to the purchase of the insurance. That document reflects the cost of automobile insurance to be $321 and it was received as evidence, Petitioner's Exhibit No. 61. At the time the automobile insurance was purchased, no request was made to join a motor club and no inquiry was made of the customer if he desired to join a motor club. The purchaser thought that he was buying automobile insurance and did not recognize that motor club membership was envisioned in the sale. He would have joined the motor club if it was part of the policy payment and not a separate charge but did not wish to pay additional money to join the motor club. Permenter did not discover that he had joined a motor club until a date subsequent to the time of the purchase of insurance. No specific discussion was entered into about the features of coverage being purchased, the principal emphasis of the sale being related to the total price. The customer was in the insurance agency for approximately 15 minutes and he did not complete the application forms other than to sign them. This customer did not read the documents carefully at the time of the purchase. The amount of money paid for the motor club membership was refunded. This customer completed a rejection of liability coverages to include a signature on that aspect of the sheet which indicated that accidental death benefit was a separate item for which a charge would be placed. This document is found as Respondent's Exhibit No. 1, admitted into evidence.
Findings Of Fact At all material times, Respondent has been licensed in Florida as a life and health insurance agent and general lines agent, Respondent was an officer or director of A Abacus Mr. Auto Insurance of Naples, Inc. (Mr. Auto), and Mr. Auto was an incorporated general lines insurance agency doing business at 2283 E. Tamiami Tr. in Naples. In late 1989 or early 1990, Respondent employed Maribelle Nunez to work at Mr. Auto. She was inexperienced in insurance. A supervisory employee trained Ms. Nunez in the manner that Respondent had approved. Ms. Nunez was trained to respond to frequent requests for the least expensive motor vehicle insurance or minimal motor vehicle insurance required by law. When customers requested quotes for such coverage, Ms. Nunez was instructed to include a "premium" for accidental death and dismemberment coverage. This training was consistent with the policy of Respondent and the practice of the other employees working for Respondent at Mr. Auto. In fact, the "premium" was a fee for joining the Colonial Touring Association, Inc., which was a motor club that provided its members accidental death and dismemberment coverage. The fee generally consisted of $30 or $45. Respondent's commission for the motor club memberships sold was 90 percent, but his commission on personal injury protection was only 17 percent. Ms. Nunez was trained to switch a customer to a different insurer if he rejected the accidental death and dismemberment coverage. The premium charged by the other insurer would be higher than the rate first quoted plus the motor club fee. After a customer agreed to purchase the insurance package presented to him, which consisted of minimal coverage plus accidental death and dismemberment, Ms. Nunez prepared the paperwork reflecting the customer's "choice" of the motor club membership. She then instructed the customer to sign where indicated. Well over 90 percent of Respondent's motor vehicle insurance sales included the motor club membership. On February 1, 1992, Joseph Benedetto visited Mr. Auto to purchase personal injury protection. He asked for the minimum coverage for his 1983 Ford pickup truck and 1972 Porsche 914. Either Ms. Nunez or another employee handled the transaction in the manner described above. Mr. Benedetto purchased what he believed was the minimum coverage required by law, even though it included a $30 fee for the motor club membership. However, even with the $30 fee included, Mr. Auto's rate was the lowest of the two or three agencies Mr. Benedetto had called. On December 10, 1991, Donna Erb visited Mr. Auto and asked for minimal insurance coverage plus collision because her 1990 Ford Probe was financed. Ms. Nunez handled the transaction in the manner described above. Ms. Erb purchased what she believed was the minimum coverage required by law, plus collision, even though it included a $30 fee for the motor club membership. However, even with the $30 fee included, Mr. Auto's rate was the cheapest that Ms. Erb could find. Petitioner presented no evidence regarding Mark Lane or Christina Harle, who are the alleged customers described in Counts III and IV. In December 1990, Gene Torsell visited Mr. Auto and asked for minimal insurance coverage for an automobile that he was using but did not own. Ms. Nunez handled the transaction in the manner described above. Mr. Torsell purchased what he believed was the minimum coverage required by law, even though it included a $45 fee for the motor club membership. However, even with the $45 fee included, Mr. Auto's rate was the cheapest of the two or three agencies that Mr. Torsell had checked. On October 19, 1990, Paul Pemberton visited Mr. Auto and asked for minimal insurance coverage for an automobile. Either Ms. Nunez or another employee handled the transaction in the manner described above. Mr. Pemberton purchased what he believed was the minimum coverage required by law, even though it included a $45 fee for the motor club membership. Consistent with the training that Respondent or his supervisory employees gave Ms. Nunez and other employees, Respondent's employees did not adequately disclose the optional nature of the motor club fee and wrongly refused to sell customers the cheapest insurance available if they declined the optional accidental death and dismemberment coverage. Respondent was aware of all such practices as they took place.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that the Department of Insurance and Treasurer enter a final order finding Respondent guilty of four violations of Section 626.9541(1)(x), Florida Statutes, and suspending his license for a total of six months. ENTERED on May 25, 1994, in Tallahassee, Florida. ROBERT E. MEALE Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings on May 25, 1994. COPIES FURNISHED: Hon. Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, FL 32399-0300 Bill O'Neil, General Counsel Department of Insurance The Capitol, PL-11 Tallahassee, FL 32399-0300 Attorney William W. Tharpe, Jr. 612-L Larson Bldg. Tallahassee, FL 32399-0333 Attorney Donald T. Franke 1044 Castello Dr., #103 Naples, FL 33940
Findings Of Fact For Petitioner: Robert C. Byerts, Esquire Office of Legal Services 412 Larson Building Tallahassee, Florida 32399-0300 For Respondent: Michael S. Moreland, Esquire Post Office Box 1992 Fort Myers, Florida 33902 STATEMENT OF THE ISSUES Whether the Respondent committed the alleged multiple violations of Chapter 626, Florida Statutes, as set forth in the Administrative Complaint.
Recommendation Based upon the foregoing, it is RECOMMENDED: That Virginia Louise Williamson be found guilty of nine violations of Section 626.611(9), Florida Statutes, and nine violations of Section 626.21, Florida Statutes, as alleged in the Administrative Complaint. That Respondent's licenses as General Lines Insurance Agent, Life Insurance Agent, and Health Insurance Agent and eligibility for licensure be suspended for a period of one year. DONE and ENTERED this 24th day of July, 1989, in Tallahassee, Leon County, Florida. VERONICA D. DONNELLY 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 24th day of July, 1989. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 88-4553 Petitioner's proposed findings of fact are addressed as follows: Accepted. See HO #2. Accepted. See HO #2. Accepted. See HO #3. Accepted. See HO #5. Accepted. Accepted. See HO #17. Accepted. See HO #3 and #18. Accepted. See HO #12 and #13. Accepted. See HO #15. Accepted. See HO #14. Accepted. See HO #8. Accepted. See HO #4. Accepted. See HO #7 Accepted. See HO #6. Accepted. See HO #9. Accepted. See HO #10. Rejected. Improper Summary. Respondent's proposed findings of fact are addressed as follows: Accepted. See HO #2. Accepted. See HO #3. Rejected. See HO #3. (Respondent's answer and prehearing statement.) Rejected. Conclusion of Law. Accepted. See HO #4. Accepted. Accepted. See HO #4. 8.-10. Accepted. Rejected. See HO #5. Rejected. Conclusion of Law. Contrary to existing law. See White v. Allstate Insurance Company, 530 So.2d 967 (Fla. 1st DCA 1988). 13.-16. Accepted. 17.-28. Accepted. See HO #6. 29.-34. Accepted. See HO #7. 35.-36. Rejected. Contrary to fact. See HO #7. 37. - 43. Accepted. See HO #8. 44. Rejected. See HO #8. 45-50. Accepted. See HO #9. 51.-52. Accepted. 53.-64. Accepted. See HO #10 and #11. 65.-76. Accepted. See HO #12 and #13. 77.-83. Accepted. See HO #14. 84.-91. Accepted. See HO #15. COPIES FURNISHED: Robert C. Byerts, Esquire Office of Legal Services 412 Larson Building Tallahassee, Florida 32399-0300 Michael S. Moreland, Esquire Post Office Box 1992 Fort Myers, Florida 33992 Honorable Tom Gallagher State Treasurer and Insurance Commissioner The Capitol Tallahassee, Florida 32399-0300 Don Dowdell, Esquire General Counsel Department of Insurance The Capitol Tallahassee, Florida 32399-0300
Findings Of Fact Respondent, Department of Insurance, is an agency of the State of Florida. Respondent, Bill Gunter, as Insurance Commissioner of the State of Florida, is the agency head of the Department of Insurance. Petitioner, Insurance Services Office, is a rating organization qualified to transact, and is transacting, specified rate-making services in Florida pursuant to a certificate of authority issued by Respondent. The other petitioners are foreign corporations authorized to do business in the State of Florida. They are licensed as automobile casualty insurers by Respondent and transact automobile and casualty insurance business in the State of Florida. The Department has adopted Rule 4-43.03, Florida Administrative Code which provides: 4-43.03 Unfair discrimination in private passenger motor vehicle insur- ance rates - based on sex, marital status and scholastic achievement. No insurer authorized to engage in the business of insurance in the State of Florida shall establish classi- fications or premium rates for any policy, contract or certificate of private pas- senger motor vehicle insurance based upon the sex, marital status or scholastic achievement of the person or persons insured. This rule shall become effective on March 1, 1980. The purpose of the proposed rule is to eliminate the use of sex, marital status and scholastic achievement criteria in the formulation of private passenger automobile insurance premium rates. Tile business which Petitioners conduct in the State of Florida involves, in some direct manner, the setting of private passenger automobile insurance premium rates. In the formulation of these rates Petitioners use, in part, sex, marital status or scholastic achievement criteria, or some combination thereof. Petitioners, with the exception of Petitioner Insurance Services Office, are insurance companies competing with one another in the private passenger automobile insurance market in Florida. They represent a very significant portion of the private passenger automobile insurance business in Florida. All of their premium rates for such insurance are formulated using sex, marital status, or scholastic achievement, or some combination thereof, along with other factors. The rule would apparently invalidate all of the rate classification plans by which Petitioners set premium rates Presently in force in Florida. To comply with the rule the Petitioners will have to devise and implement new rate classification plans. Such an action is a major undertaking by an insurance company. Prior to the adoption of the rule the Department's historic interpretation of the Florida Insurance Code and specifically Section 626.9541(15)(h), Florida Statutes, has allowed rate classification plans using sex, marital status and scholastic achievement criteria in their formulation. Such criteria have historically been part of rate classification plans and, prior to adoption of the rule, have never been disapproved by the Department. It should be noted that Florida is a "use and file" state wherein an insurer files its rate classification plan with the responsibility then shifting to the Department to challenge the validity of that plan. The Respondent did not offer evidence or testimony sufficient to establish that factual changes of any nature have occurred, or that the Department has become aware of new factual information, which would support a deviation from their historic interpretation of the Florida Insurance Code. Historically the Department has not considered rate classification plans which use sex, marital status and scholastic achievement, along with other criteria in their formulation to be "unfairly discriminatory as that term is used in the Florida Insurance Code. As confirmed by the testimony of the Chief Actuary and Director of the Division of Insurance Rating for the Department, as well as expert actuaries testifying on behalf of Petitioners, the best way to equitably reflect differences in expected losses among insureds is to reflect those differences as accurately as possible. From an actuarial standpoint the most equitable classification factors are those that are the most actuarially sound. The classification factors of sex, marital status and scholastic achievement, in light of the present state of the art in the industry, enhances the actuarial soundness of a rate classification for automobile insurance. The Chief Actuary and Director of the Division of Insurance Rating for the Department did not know of any classification plan that eliminated sex, marital status and scholastic achievement as classification factors that is as actuarially accurate as Petitioner State Farm's present classification plan which uses some or all of those classification factors. Respondents have admitted that Section 626.9541 (15)(h), Florida Statutes, (which reads No insurer shall, with respect to premiums charged for automobile insurance, unfairly discriminate solely on the basis of age, sex, marital status or scholastic achievement) does not absolutely prohibit all discrimination on the basis of sex, marital status, or scholastic achievement. In the insurance industry rate classifications necessarily discriminate between different classes of individuals with different levels of expected losses and exposure. Such discrimination is not necessarily unfair. The Economic Impact Statement promulgated by the Department in the adoption of the rule was prepared by Mark Trafton III, Chief Actuary and Director of the Division of Insurance Rating for the Department. The elimination of the subject criteria by the Rule will require insurance companies writing automobile insurance in Florida to devise and file new rate classification plans. Such action on the part of the insurance companies will cause them to incur expenses, possibly substantial in nature. The Economic Impact Statement contains no estimate of, nor reflects any inquiry into, the expense to the industry or individual insurance companies of devising new rate classification plans for use in Florida. In Paragraph 1 of the Economic Impact Statement it is estimated that the cost to the Department of implementing the Rule will be approximately $6,000.00. The evidence establishes that this estimate, at best, reflects only the cost to the Department of the adoption process. It is not intended to reflect any cost to the Department of the actual implementation of the Rule. It is reasonable to assume that because of the Rule there will be a significant increase in the number of rate filings with the Department which the Department will be required to review. The Economic Impact Statement reflects no assessment of any kind, of this potential cost to the Department. There is a class of individuals in Florida presently receiving the benefit of discounted premiums through "good student discounts" offered by one or more insurance companies. This class of individuals will be adversely affected by the Rule in that they may no longer receive the discount they are now receiving. No estimate of this cost to that class of individuals is reflected in the Economic Impact Statement and, in fact, no such estimate was made. Further, the testimony establishes that there was no reason why such an estimate could not have been included in the Economic Impact Statement and its omission was probably an oversight by the preparer of the statement. The evidence establishes that the Department has changed its interpretation of the word "equitably" as used in Section 627.0651(6), Florida Statutes (1979), as well as its interpretation of the phrase "unfair discrimination" as contained in the Florida Insurance Code relevant to this proceeding.
The Issue Whether the Petitioner committed the violations alleged in the Amended Administrative Complaint filed October 14, 2003, and, if so, the penalty that 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 is the state agency responsible for issuing licenses for insurance agents in the State of Florida, and for regulating and disciplining licensed insurance agents. Sections 626.016, 626.611, and 626.281, Florida Statutes (2004). At all times material to this proceeding, Mr. Pomerantz was licensed in Florida as a property and casualty general lines insurance agent, which is referred to as a "2-20 license." At all times material to this proceeding, Mr. Pomerantz did business as A Able insurance agency, an unincorporated entity located at 124 South Federal Highway, Pompano Beach, Florida. Mr. Pomerantz owned the A Able insurance agency, worked in the office in Pompano Beach, and was the agent in charge of the office. Automobile insurance was the primary product sold at the Pompano Beach office of the A Able insurance agency. No primary agent for the A Able insurance agency office in Pompano Beach was registered with the Department, but Mr. Pomerantz functioned as its de facto primary agent at that location. An insurance agency known as the Wide World of Insurance was, and perhaps still is, located in Margate, Florida. Mr. Pomerantz's brother, Randy Pomerantz, operated this agency. In the summer of 2000, the two offices merged, but the merger dissolved in the early spring of 2002. During the time that the two agencies operated as a single entity, they continued to maintain the two office locations. Applications and other paperwork generated in the Pompano office were, as a rule, sent to the Margate office for processing. Prior to May 2003, however, when he began working in a general administrative capacity at the Margate office, Mr. Pomerantz did not work in the Margate office and had no personal knowledge of the operations of the Margate office or the applications for automobile insurance handled by that office. At the times material to this proceeding, Mr. Pomerantz was the appointed agent for Ocean Harbor Insurance Company ("Ocean Harbor"), Southern Group Indemnity, Inc. ("Southern Group"), and U.S. Security Insurance Company ("U.S. Security"). As an appointed agent, Mr. Pomerantz, as well as agents working in the Pompano Beach office of the A Able insurance agency, acted on behalf of these companies, and the agents could bind coverage with the companies and accept premium payments on behalf of these companies. An insurance agent can "bind" automobile insurance coverage with an insurance company that has appointed or registered the agent as its representative by calling the insurance company and getting a binder number and time of day. A binder obligates the insurance company to provide the coverage specified until the binder is converted into an insurance policy or the binder is cancelled. Southern Group's agreement with Mr. Pomerantz required him to send the signed application for a new automobile insurance policy, for a renewal of an existing policy, or an amendment to an existing policy, together with a check or draft for the premium net commissions, postmarked within 72 hours of the time at which the coverage was bound. Although not reduced to writing, the standard policy of U.S. Security requires its appointed agents to mail the application and payment to the company immediately upon coverage being bound. Ocean Harbor's general rules applicable to its appointed agents require that a completed application and the required premium, together with other documentation, be received by the company within five working days of the date on which coverage is bound. Within 20 to 30 days after coverage is bound on an application, each of these three companies sends a notice to the agent listing the binders for which the company has not received the application, premium, and other required paperwork. The notice advises the agent that the binder is cancelled. This means that the insurance company no longer provides automobile insurance coverage under the binder. If the application, premium, and other required paperwork is subsequently forwarded to the insurance company, the company, after review by its underwriters, can accept the application and issue a policy with an effective date retroactive to the effective date stated on the application for the policy. In some circumstances, the underwriting review will result in an additional premium being charged on the policy. In this circumstance, a notice is sent to the insured advising them of the additional premium due. At the time the application for automobile insurance coverage is completed and the coverage is bound by an agent appointed or registered by the company, the customer pays the insurance agent either the full amount of the premium determined by the agent to be due or a down payment on the premium when the premium is financed by a premium finance company. Insurance companies using appointed or registered agents do not, as a rule, accept payment directly from the customer; rather, the payment received from a customer is deposited in the agency's account, and the agency, after deducting its commission, sends an agency check to the insurance company. When the premium is financed, the down payment is deposited in the agency account, and the agency, after deducting its commission, sends an agency check to the premium finance company. When a customer finances his or her insurance premium through a premium finance company, the customer signs a premium finance agreement in which he or she agrees to pay monthly installments to the premium finance company for the total owed under the agreement; the premium finance company, in turn, pays the full premium to the insurance company at the time the application is submitted to the insurance company. Premium finance companies provide agents with whom they do business company drafts, which are prepared by the insurance agent on behalf of the premium finance company. Mr. Pomerantz and the A Able insurance agency did business with the premium finance company ETI Finance Corporation ("ETI Finance"), and A Able insurance agency was supplied with ETI Finance premium finance agreements and ETI Finance drafts. In ETI Finance's premium finance agreement, the customer agrees to assign to ETI Finance a security interest in any unearned return premiums that may become due upon the cancellation of the insurance policy. The insurance company sends this unearned return premium directly to ETI Finance if the insurance policy is cancelled. ETI Finance deducts any amounts owed under the premium finance agreement; if the amount of unearned return premium exceeds the amount the customer owes ETI Finance under the premium finance agreement, ETI Finance remits the balance owed to the customer to the insurance agent; if the amount of unearned return premium is insufficient to cover the amount the customer owes ETI Finance, ETI Finance bills the insurance agent for the balance owed under the premium finance agreement. ETI Finance handles unearned return premium credits and debits on an account current basis whereby a bi-monthly statement is prepared for each of the agents with whom it does business. The statement lists customers and all debits and credits to the agent's account for each of the customers listed. When an insurance policy is cancelled, the agent statement includes the amount of unearned return premium received by ETI Finance from the insurance company, and shows whether the customer is owed money, which is shown as a credit to the agent's account, or whether the agent owes ETI Finance money, which is shown as a debit to the agent's account. All of the debits and credits are totalled on the bi-monthly statement; if a total credit is shown, an ETI Finance check is included with the statement; if a total debit is shown, the agent is required to send ETI Finance a check to cover the amount owed. ETI Finance's agent statement advises the agent to review the statement carefully because the agent might owe a customer a refund. If a customer pays the agent the full premium and the agent then pays the premium with an agency check, the insurance company sends the agent an unearned return premium. It is the agent's responsibility to refund the unearned return premium to the customer. In addition to paying a customer any unearned return premium received upon cancellation of a policy, the agent is responsible for refunding any unearned commissions the agent was paid on the policy. Either the insurance company or the agent calculates the amount of the unearned commission, and this is included in the payment to the customer. At all times material to this proceeding, Alida High, nee Watson, held a "2-20 license" allowing her to sell property and casualty insurance in Florida. She was employed by the A Able insurance agency and worked in the office located at 124 South Federal Highway, Pompano Beach, Florida. She began working for the A Able insurance agency in July 1999, and was paid a weekly salary plus commissions Mr. Pomerantz and Ms. High were authorized signatories on the A Able insurance agency's Bank of America checking account number 91895073. Ms. High and Mr. Pomerantz signed the signature card on February 18, 2000. Ms. High functioned as a licensed insurance agent in the Pompano Beach office of the A Able insurance agency, and her responsibilities included working with customers to prepare applications for automobile insurance coverage, binding coverage with the insurance companies, receiving payment for the premiums on the policies or for the down payment on a premium finance agreement if the premium was financed, preparing the application package to be sent out to the insurance company, and issuing temporary identification cards. If a customer of the A Able insurance agency paid his or her premium for a policy in full, the cash or check was deposited in the agency's account, and the insurance agency issued a check payable to the insurance company for the premium minus the agency's commission. In this circumstance, Ms. High prepared the application package and placed it on Mr. Pomerantz's desk so that he could write the agency's check and send the application package and check to the appropriate insurance company. Ms. High followed this procedure throughout her employment at the A Able insurance agency, in accordance with the directions Mr. Pomerantz gave her when she began working for the A Able insurance agency. If one of Ms. High's customers financed part of the premium with a premium financing company, Ms. High routinely issued the drafts of the premium finance company for the premium owed for an insurance policy, and she mailed the draft and the application package to the insurance company. Ms. High also occasionally prepared and signed checks on the A Able insurance agency's Bank of America checking account payable to "BCRC"2 to pay for automobile tags and titles issued by Broward County and other, minor, miscellaneous items. During the summer and early fall of 2002, Ms. High prepared checks at Mr. Pomerantz's request and signed his name. Most of these checks were to "BCRC", but several were to pay for office expenses, and one was written to U.S. Security Insurance Company to pay a customer's additional insurance premium. Ms. High wrote checks on the A Able insurance agency account only when she had Mr. Pomerantz's permission to do so. Writing checks was not among her normal responsibilities at the A Able insurance agency, and Ms. High would not write checks on the agency's account without Mr. Pomerantz's express permission because she did not know anything about the account balance. Beginning in the summer of 2002, Mr. Pomerantz's interest in the business of the A Able insurance agency waned, according to Ms. High, and his visits to the office became more and more infrequent. Initially during this period Mr. Pomerantz came in every few days and wrote checks and sent application packages out to insurance companies, but eventually applications for insurance prepared and bound by Ms. High began to accumulate on Mr. Pomerantz's desk. When Ms. High reminded Mr. Pomerantz that the applications on his desk had been bound and needed agency checks cut so they could be sent to the insurance companies, Mr. Pomerantz told her to leave them, that he would take care of it. Ms. High became more and more concerned about the backlog of applications on Mr. Pomerantz's desk, and, when he was in the office, she constantly reminded him of the need to send the applications to the insurance companies. Count I: John Thierwechter In February 2002, John Thierwechter went to the A Able insurance agency to purchase the minimum amount of automobile insurance required by law for a 1993 Nissan Sentra. The total premium quoted was $1,550.00 for personal injury protection/physical damage/comprehensive/collision coverage with Ocean Harbor and for a policy covering reimbursement of the $500.00 deductible on the Ocean Harbor policy. Mr. Thierwechter decided to finance the premium, and Ms. High completed an ETI Finance premium finance agreement, which Mr. Thierwechter signed on February 21, 2002. The first installment on the Premium Finance Agreement signed by Mr. Thierwechter was due on March 23, 2002. Mr. Thierwechter owed a down payment of $289.00 under the Premium Finance Agreement. On February 22, 2002, he paid $200.00 of the down payment in cash, and he received a receipt signed by Mr. Pomerantz. Mr. Thierwechter returned to the agency on February 25, 2002, to pay the remaining $89.00, and he received a receipt signed by Ms. High. Mr. Thierwechter had previously had a bad experience with Ocean Harbor, and, within a few weeks, he purchased automobile insurance coverage from GEICO Casualty Company. This coverage was effective March 16, 2002. In a letter dated March 15, 2002, that he hand-delivered to the A Able insurance agency, Mr. Thierwechter requested that his Ocean Harbor policy be cancelled and that he receive a refund of "the unearned premium" . . . within the next 30 days." On March 16, 2002, Ms. High completed an All Purpose Endorsement requesting that Ocean Harbor cancel Mr. Thierwechter's insurance coverage effective March 16, 2002. This request was received by Ocean Harbor on March 23, 2002. Because Mr. Thierwechter had financed the premium for his Ocean Harbor policy with ETI Finance, Ocean Harbor sent the unearned return premium to ETI Finance, pursuant to the Premium Finance Agreement signed by Mr. Thierwechter. ETI Finance received the cancellation notice and check for the unearned return premium from Ocean Harbor on April 9, 2002. The amount of the unearned return premium was included on the agent's statement for the A Able insurance agency dated May 1, 2002. That statement reflected return premium in the amount of $757.35. This amount was less than the amount Mr. Thierwechter owed ETI Finance because Mr. Thierwechter had not made any of the monthly installments required by the Premium Finance Agreement. As a result, the May 1, 2002, agent's statement recorded a $63.47 debit against the account of the A Able insurance agency. The A Able insurance agency was responsible for paying Mr. Thierwechter the amount of unearned commission, if any, that exceeded the $63.47 it owed to ETI Finance. Pursuant to Mr. Pomerantz's calculations, Mr. Thierwechter was owed $70.16 in unearned commission retained by the A Able insurance agency, and Mr. Pomerantz wrote Mr. Thierwechter a check for that amount on the A Able insurance agency account on July 1, 2002. Mr. Thierwechter picked up the check on or about July 22, 2002. Count III: Shirley Shaffer On or about June 11, 2001, Shirley Shaffer purchased a 1996 Kia Sephia from the Coral Springs Auto Mall. Before Ms. Shaffer could drive the car off of the car lot, the car dealer required her to secure automobile insurance. The dealer called a person to assist Ms. Shaffer, and a man arrived at the dealership within a short period of time. This man presented Ms. Shaffer with a card on which was printed "Wide World of Insurance"; there was no individual's name on the card, but the card showed a Margate, Florida, address. Ms. Shaffer wanted to purchase only the basic coverage, and a U.S. Security application for a "physical damage only" policy was prepared specifying comprehensive and collision coverage only. The application identified the insurance agency as the A Able insurance agency, located in Pompano Beach. According to a notation on the application, the comprehensive and collision insurance coverage was bound with U.S. Security at 3:00 p.m. on June 12, 2001.3 In addition, Ms. Shaffer signed a Summary of Coverages and Cost Breakdown form carrying the name "Wide World of Insurance" and an address in Margate, Florida. This form was also dated June 12, 2001. At some point during the application process at the Coral Springs Auto Mall, the person representing the insurance agency went outside the dealership offices, telling Ms. Shaffer that he was going to take photographs of her car to attach to the application for insurance coverage. Ms. Shaffer financed the premium for her automobile insurance policy, and she paid a deposit of $200.00, which she charged on her credit card. U.S. Security received Ms. Shaffer's application for comprehensive and collision coverage on June 18, 2001, and a Physical Damage Policy was issued to Ms. Shaffer on June 26, 2001, with a policy term of June 13, 2001, to June 13, 2002. Ms. Shaffer received a copy of this policy. The agent identified on the policy was the A Able insurance agency in Pompano Beach. A Notice of Cancellation dated July 18, 2001, was sent to Ms. Shaffer by U.S. Security. In the notice, Ms. Shaffer was advised that her insurance policy would be cancelled effective September 2, 2001, because her application was incomplete. After she received the cancellation notice, Ms. Shaffer called the Margate office of the Wide World of Insurance insurance agency because that was the office whose address was on the card she was given when she applied for the U.S. Security insurance policy. Someone at the Margate office told her that, because she lived in Pompano Beach, her account was handled by the agency's Pompano Beach office and that she should call that office. Ms. Shaffer contacted the Pompano Beach office and spoke to a man who told her that everything about her policy looked fine in the computer and that she should not worry about the letter from U.S. Security. After this conversation, she contacted the Margate office again and was told that they knew nothing about the problem with the policy at that office. Ms. Shaffer then telephoned U.S. Security and was told that her insurance agent needed to take care of the problem, which she was led to believe was minor. Finally, Ms. Shaffer received a letter dated August 7, 2001, from a person named Gary. The letter carried the name "Wide World of Insurance" and the Margate address. In the letter, Gary requested that Ms. Shaffer "PLEASE STOP BY OUR OFFICE SO WE MAY TAKE PICTURES OF THE KIA. ORIGINAL ONES DID NOT COME OUT. ALSO NEED REGISTRATION. IMPT!!!!!" Gary stated in the letter that Ms. Shaffer needed to provide the requested information by August 21, 2001, "to avoid any further delays or cancellation requests from the insurance company." When she received the August 7, 2001, letter, which she recalled was on a Friday, Ms. Shaffer called the Margate office and arranged to bring her car in for photographs at 8:00 a.m. the following Monday.4 Ms. Shaffer arrived at the Margate office slightly before 8:00 a.m., and a few minutes later the man who had taken her application at the Coral Springs Auto Mall arrived at the office and took pictures of her car. Ms. Shaffer also provided a copy of her automobile registration, as requested in the August 7, 2001, letter. Ms. Shaffer also purchased personal liability insurance coverage from the Pompano Beach office of the A Able insurance agency, and she charged the $659.00 premium on her Visa credit card. Ms. Shaffer handled the entire transaction during a telephone conversation with a person in the Pompano Beach office, but she does not know the name of the person with whom she spoke. When Ms. Shaffer went to the Margate office in response to Gary's letter of August 7, 2001, she was given a receipt dated August 6, 2001, for the $659.00 premium she had paid for "addl liability coverage"; it was stated on the receipt that the coverage would be effective from September 1, 2001, to June 12, 2001. The person who signed the receipt was not identified, and the signature is indecipherable. The transaction date shown on Ms. Shaffer's credit card statement was August 7, 2001, and the statement showed that the charge was credited to "A ABLE WIDE WORLD OF I POMPANO BEACH FL." Ms. Shaffer also received a Florida Automobile Insurance Card confirming that she had personal injury protection benefits, property damage liability, and bodily injury liability coverage with U.S. Security; the agent identified on the card was "A Able Wide World of Insurance," with a post office box address in Margate, Florida. U.S. Security cancelled Ms. Shaffer's physical damage policy effective September 2, 2001, because her application was incomplete. U.S. Security sent a check dated September 26, 2001, to ETI Finance for $323.85, which was the unearned return premium owing on Ms. Shaffer's policy. U.S. Security never received an application for the "additional liability coverage" Ms. Shaffer requested and paid for on August 7, 2001. On October 22, 2001, Ms. Shaffer was caught in a flash flood, and she drove her Kia automobile into an area of water that was so deep her automobile floated. At one point, a bus drove through the water near the Kia, and the wake caused the Kia to wash into railroad ties that were used in the yard of a nearby home for landscaping. The railroad ties tore off the front of the car. The damage to the Kia was so extensive that it was considered a total loss. Ms. Shaffer filed a claim with U.S. Security, and received a letter dated October 25, 2001, from Corporate Claim Services, Inc., acknowledging receipt of her claim on behalf of U.S. Security. Ms. Shaffer then received a letter from Corporate Claim Services, Inc., dated October 26, 2001, advising her that her insurance policy with U.S. Security was cancelled effective September 2, 2001. Because Ms. Shaffer had no automobile insurance at the time her car was damaged, she had the Kia repaired at her own expense and incurred substantial expense and inconvenience because she had to arrange for alternative transportation during the year-and-a-half it took to have her car repaired. Ms. Shaffer did not receive any unearned premium or unearned commission refund after the cancellation of her policy. Ms. Shaffer never did business in person with Mr. Pomerantz. In fact, she met him for the first time the week before the final hearing, when her deposition was taken. Count IV: Terensinha Honczarenko On or about March 30, 2001, Terensinha Honczarenko went to the Margate office of the Wide World of Insurance insurance agency to purchase automobile insurance for a newly- purchased Toyota Corolla.5 Ms. Honczarenko had done business with the insurance agency located in Margate for a number of years. A man working at the Margate office named Greg completed Ms. Honczarenko's application for automobile insurance coverage with Southern Group, which she signed.6 The A Able insurance agency in Pompano Beach was identified in the application as the agent producing the application. Coverage on Ms. Honczarenko's policy was bound on the policy on March 30, 2001, and Southern Group received the application on April 4, 2001. The underwriting review of Ms. Honczarenko's application was completed on May 29, 2001, and Southern Group issued a policy to Ms. Honczarenko on June 26, 2001, with an effective date of March 31, 2001, through March 31, 2002. The A Able insurance agency in Pompano Beach was identified on the policy as the insurance agent. Ms. Honczarenko paid a $275.00 down payment on the total policy premium of $1098.00, and financed the remainder of the premium with ETI Finance.7 The Premium Finance Agreement was dated March 30, 2001, and was processed by ETI Finance on April 18, 2001. Ms. Honczarenko made payments pursuant to the Premium Finance Agreement from April 30, 2001, until August 2001. Ms. Honczarenko regularly made these payments at the Margate office, sometimes paying in cash and sometimes paying by check. When she took her August 2001 payment to the Margate office, Greg told her that there was a problem with her insurance policy and that she should come back in two days. When she returned to the Margate office, she was told that her automobile insurance policy had been cancelled. When she asked for her money back, Greg refused. At some point in June 2001, Southern Group sent Ms. Honczarenko a notice at her correct address advising her that she owed $263.00 in additional premium on Southern Group automobile insurance policy. She was given three options: To pay the additional premium by June 28, 2001, and keep the policy in force; to request by July 18, 2001, that Southern Group cancel the policy and refund any unearned premium; or to do nothing, in which case the policy would be cancelled effective July 18, 2001, and the unearned premium refunded. Ms. Honczarenko claims she never received this notice. Southern Group also sent Ms. Honczarenko a notice dated June 21, 2001, to her correct address, advising her that the vehicle identification number on her insurance application did not correspond to the vehicle identification number in their records. Southern Group asked Ms. Honczarenko to check her registration and return the letter to Southern Group with the correct information set forth on the bottom of the letter. Ms. Honczarenko claims she never received this notice. Southern Group also sent a copy of the notice to the "Wide World of Ins Pompano Bch." In a letter dated June 29, 2001, "Gary" advised Ms. Honczarenko that she needed to supply the Margate office with a copy of the registration for her 1985 Toyota. This letter was sent to the same address as the notices sent Ms. Honczarenko by Southern Group. Ms. Honczarenko received the June 29, 2001, letter from the Margate office of the Wide World of Insurance insurance agency.8 Because Southern Group received no response from Ms. Honczarenko to its notice that she owed additional premium on her automobile insurance policy, it cancelled her policy effective July 18, 2001, and sent her a notice of cancellation dated June 29, 2001. The notice was sent to the same address as was the notice of additional premium and the notice that there was a discrepancy in her automobile identification number. Ms. Honczarenko received the notice of cancellation. On August 10, 2001, Southern Group sent a check to ETI Finance for unearned return premium on Ms. Honczarenko's automobile insurance policy in the amount of $572.90. ETI Finance received the check on August 16, 2001, and included Ms. Honczarenko's unearned return premium in the statement it sent to the A Able insurance agency in Pompano Beach on or about August 31, 2001. The statement showed that ETI Finance had received $572.90 in unearned return premium on Ms. Honczarenko's account, and it included a credit to the A Able insurance agency of $71.95. Ms. Honczarenko did not receive any refund of unearned return premium or unearned commission from A Able insurance agency. Count V: Cecil Worrall On June 10, 2002, Cecil Worrall went to the A Able insurance agency in Pompano Beach to renew his automobile insurance within Southern Group. At that time, he had done business with A Able insurance agency in Pompano Beach for eight-to-ten years. Mr. Pomerantz completed Mr. Worrall's application, which Mr. Worrall signed. Mr. Worrall gave Mr. Pomerantz a check in the amount of $570.00 as payment of the full amount of the renewal premium. Mr. Pomerantz gave the application to Ms. High and expected her to bind the coverage and process the application. According to a notation of the application, coverage was bound on June 19, 2002, at 3:46 p.m., and, as was her custom, Ms. High put the application package on Mr. Pomerantz's desk for him to review, prepare an agency check for the premium net commission, and mail the application package and payment to Southern Group. Mr. Worrall's June 10, 2002, check was deposited into the account of "A Able Wide World of Insurance." Southern Group did not receive the application and agency check for the premium net commission on Mr. Worrall's renewal within the 72 hours required by Southern Group's agreement with Mr. Pomerantz. On July 12, 2002, a notice was sent to "Wide World of Insurance Pomp" at the A Able insurance agency address in Pompano Beach advising that Mr. Worrall's binder coverage had expired because Southern Group had not received the application.9 Southern Group advised the A Able insurance agency to check its records to make sure that the application package was not misplaced and further advised that a claim against the binder might result in a claim against its "Errors & Omissions Insurance." The Department of Insurance10 made an inquiry of Southern Group on October 16, 2002, regarding the status of Mr. Worrall's insurance policy, and Southern Group replied in a letter dated October 28, 2002, that, although coverage had been bound for Mr. Worrall, it had no record of having received Mr. Worrall's application and the premium payment or a response to its July 12, 2002, notice to the A Able insurance agency that the binder had expired. After Southern Group received the inquiry from the Department of Insurance, it sent a representative to the A Able insurance agency Pompano Beach office, where the Southern Group application for Mr. Worrall was retrieved. On December 10, 2002, Southern Group issued an automobile insurance policy to Mr. Worrall, with an effective date retroactive to June 26, 2002, the date the policy would have been effective had the application and premium payment been transmitted to Southern Group timely. Count VI: Cynthia Mousel Cynthia Mousel was a client of the A Able insurance agency Pompano office, and primarily Ms. High handled her business. On or about September 18, 2002, Ms. High completed an application within U.S. Security for automobile insurance coverage on behalf of Ms. Mousel. Ms. Mousel signed the application, and coverage was bound on September 18, 2002. Ms. Mousel paid the full premium of $524.00. As was her custom, Ms. High put the application package on Mr. Pomerantz's desk for him to review, prepare an agency check for the premium net commission, and mail the application package and payment to U.S. Security. In October 2002, the Department of Insurance sent an inquiry to U.S. Security regarding the status of Ms. Mousel's automobile insurance policy. In a letter dated October 30, 2002, U.S. Security advised the Department of Insurance that it had no record that, as of that date, it had received an application for automobile insurance coverage under Ms. Mousel's name.11 Count VII: Fred Hublitz Fred Hublitz was a long-time customer of the A Able insurance agency in Pompano Beach. On September 13, 2002, Mr. Hublitz visited the office, and Ms. High completed an Endorsement Request Form on his behalf to add coverage to his automobile insurance policy with Ocean Harbor for a 2000 Mercury Sable automobile. Mr. Hublitz signed the endorsement and wrote a check for $260.00, which was the full amount of the premium to add this coverage. The coverage was bound on September 13, 2002. As was her custom, Ms. High put the endorsement package on Mr. Pomerantz's desk for him to review, prepare an agency check for the premium net commission, and mail the endorsement and payment to Ocean Harbor. The check written by Mr. Hublitz on September 13, 2002, was deposited into the account of "A Able Wide World of Insurance." In a letter dated October 16, 2002, the Department of Insurance inquired of Ocean Harbor regarding the status of Mr. Hublitz's automobile insurance policy. Ocean Harbor responded in a letter dated November 7, 2002, that it had no record of having received the endorsement or premium payment for Mr. Hublitz's 2000 Mercury Sable. An Ocean Harbor representative went to the A Able insurance agency office in Pompano Beach on November 15, 2002, and picked up applications and endorsements for automobile insurance coverage. Among these documents was Mr. Hublitz's endorsement, and Ocean Harbor added the 2000 Mercury Sable to Mr. Hublitz's existing Ocean Harbor automobile insurance policy, effective retroactively.12 Count VIII: Lori O'Connell Lori O'Connell had obtained automobile insurance coverage from the A Able insurance agency in Pompano Beach. She had received a notice that her policy with Southern Group was to expire on August 14, 2002, and a friend, Joseph Balsamo, went to the A Able insurance agency office on July 9, 2002, and gave Ms. High a check for $364.00, which was full payment for the policy renewal. Ms. High bound the renewal on July 12, 2002. As was her custom, Ms. High put the application package on Mr. Pomerantz's desk for him to review, prepare an agency check for the premium net commission, and mail the renewal application package and payment to Southern Group. A month later, Ms. O'Connell had not received an insurance card or renewal policy, and Mr. Balsamo telephoned the A Able insurance agency Pompano Beach office and inquired about the policy. Ms. High told him that the insurance company was slow in processing the renewals and that Ms. O'Connell should receive the materials shortly. Ms. High knew, at the time, that the renewal application was sitting on Mr. Pomerantz's desk, waiting for him to write a check and mail the application and payment to Southern Group. Southern Group did not receive the renewal application and agency check for the premium net commission on Ms. O'Connell's renewal within the 72 hours required by Southern Group's agreement with Mr. Pomerantz. On August 2, 2002, a notice was sent to "Wide World of Insurance Pomp" at the A Able insurance agency address in Pompano Beach advising that Ms. O'Connell's binder coverage had expired because Southern Group had not received the renewal application.13 Southern Group advised the A Able insurance agency to check its records to make sure that the application package was not misplaced and further advised that a claim against the binder might result in a claim against its "Errors & Omissions Insurance." The Department of Insurance made an inquiry of Southern Group on October 16, 2002, regarding the status of Ms. O'Connell's renewal policy, and Southern Group replied in a letter dated October 28, 2002, that, although coverage had been bound for Ms. O'Connell on July 12, 2002, it had no record of having received Ms. O'Connell's renewal application and the premium payment or a response to its August 2, 2002, notice to the A Able insurance agency that the binder on Ms. O'Connell's renewal had expired. After Southern Group received the inquiry from the Department of Insurance, it sent a representative to the A Able insurance agency Pompano Beach office, where the Southern Group renewal application for Ms. O'Connell was retrieved. On November 26, 2002, Southern Group issued an automobile insurance policy renewal to Ms. O'Connell, with an effective date retroactive to August 14, 2002, the date the renewal would have been effective had the application and premium payment been transmitted to Southern Group timely. Count IX: Carol Scott On July 10, 2002, Ms. High prepared an application for automobile insurance coverage with Southern Group on behalf of Carol Scott. The premium for the coverage specified in the application was $655.00. Ms. High bound the coverage on July 10, 2002. Southern Group did not receive Ms. Scott's application and the agency check for the premium net commission within the 72 hours required by Southern Group's agreement with Mr. Pomerantz. On August 2, 2002, a notice was sent to "Wide World of Insurance Pomp" at the A Able insurance agency address in Pompano Beach advising that Ms. Scott's binder coverage had expired because Southern Group had not received the application. Southern Group advised the A Able insurance agency to check its records to make sure that the application package was not misplaced and further advised that a claim against the binder might result in a claim against its "Errors & Omissions Insurance." The Department of Insurance made an inquiry of Southern Group on October 16, 2002, regarding the status of Ms. Scott's automobile insurance policy, and Southern Group replied in a letter dated October 28, 2002, that, although coverage had been bound for Ms. Scott on July 10, 2002, it had no record of having received Ms. Scott's application and the premium payment or a response to its August 2, 2002, notice to the A Able insurance agency that the binder on Ms. Scott's application had expired. After Southern Group received the inquiry from the Department of Insurance, it sent a representative to the A Able insurance agency Pompano Beach office, where the Southern Group application for Ms. Scott was retrieved. On November 26, 2002, Southern Group issued an automobile insurance policy renewal to Ms. Scott, with an effective date retroactive to July 11, 2002, the date the renewal would have been effective had the application and premium payment been transmitted to Southern Group timely. Count X: Janice Misconis On or about June 25, 2003, Janice Misconis visited the A Able insurance agency office in Pompano Beach to renew her Ocean Harbor automobile insurance policy. Ms. High prepared a Summary of Coverages and Premium covering a 1990 Buick Skylark. Ms. High bound the coverage on June 24, 2002, for a renewal with a policy period commencing July 8, 2002. The premium shown on the summary totalled $570.00, and Ms. High prepared a receipt affirming that Ms. Misconis had paid the $570.00 renewal premium in full on June 25, 2002. In a letter dated October 16, 2002, the Department of Insurance inquired of Ocean Harbor regarding the status of Ms. Misconis's automobile insurance policy. Ocean Harbor responded in a letter dated November 7, 2002, that it had no record of having received an application or premium payment for Ms. Misconis's policy renewal. An Ocean Harbor representative went to the A Able insurance agency office in Pompano Beach on November 15, 2002, and picked up applications and endorsements for automobile insurance coverage. Among these documents was Ms. Misconis's renewal application, and Ocean Harbor issued a policy of automobile insurance coverage, effective retroactively to the date it would have been effective had the application and premium payment been forwarded to Ocean Harbor timely.14 Count IX: Diane Carroll In October 2001, Diane Carroll, a/k/a Diane Heinen, purchased an automobile insurance policy with the Aires Insurance Company ("Aires") from the Wide World of Insurance insurance agency in Margate. After she had an accident and her car was sitting in a repair shop, she cancelled this policy. In late January 2002, Ms. Carroll went again to the Wide World of Insurance office in Margate, and a person working in that office took her application for another automobile insurance policy. The policy was placed with Aires, and the total premium was $2,637.00. The effective date of the policy was February 1, 2002, for the term of one year. Ms. Carroll made a down payment of $660.00, and financed the balance of the premium with Assured Premium Finance Corporation, a company that is serviced by ETI Finance. Ms. Carroll made all of the payments required under the Premium Finance Agreement she signed in January 2002. Ms. Carroll took each of the payments to the Wide World of Insurance insurance agency office in Margate. On January 8, 2003, Ms. Carroll had an automobile accident. She called the Wide World of Insurance insurance agency in Margate to report a claim, and she was told that she did not have an insurance policy, that Aires "went under." The person at the Margate office of the Wide World of Insurance insurance agency told Ms. Carroll that she had been sent notification by mail. Ms. Carroll requested a copy of the letter, which she claims she did not receive. The letter is dated November 27, 2002, and bears the letterhead of "Wide World of Insurance," with a Margate post office address. The letter is addressed to Ms. Carroll at her then-correct address and provides notice that Aires has been "PLACED IN LIQUIDATION ON NOVEMBER 14, 2002, BY THE STATE OF FLORIDA. ALL INSURANCE POLICIES WITH THE ABOVE- CAPTIONED INSURANCE COMPANY SHALL CEASE AS OF 12:01 AM, DECEMBER 14, 2002. PLEASE CONTACT OUR OFFICE IMMEDIATELY TO REPLACE THIS INSURANCE COVERAGE." The name "A Able Wide World of Insurance" is included on the letter. There is no indication on the letter that it was sent by certified mail.15 Summary Count I: Mr. Thierwechter The evidence presented by the Department is sufficient to establish that the refund of unearned commission on Mr. Thierwechter's cancelled Ocean Harbor automobile insurance policy was not made timely by the A Able insurance agency, but was held by the A Able insurance agency from early May 2002, when the A Able insurance agency received the agent statement from ETI Finance showing the debit to the A Able insurance agency's account, until July 1, 2002, when Mr. Pomerantz issued a check for the amount of unearned commission the A Able insurance agency owed to Mr. Thierwechter. Count III: Ms. Shaffer The evidence presented by the Department is not sufficient to establish with the requisite degree of certainty that either Mr. Pomerantz or the Pompano Beach office of the A Able insurance agency was involved in any meaningful way in any transactions relating to Ms. Shaffer's physical damage automobile insurance policy. Although, during the summer and fall of 2001, the A Able insurance agency located in Pompano Beach and the Wide World of Insurance agency located in Margate had merged and were doing business as a single entity, Mr. Pomerantz was the agent in charge of the Pompano Beach office. There was no evidence presented to establish that Mr. Pomerantz ever operated in the Margate office or supervised the agents in that office. Even though the Pompano Beach office of the A Able insurance agency is identified as the agent on Ms. Shaffer's U.S. Security policy, there was no creditable evidence presented to establish that anyone in the Pompano Beach office prepared the application for Ms. Shaffer's physical damage insurance policy or was responsible for servicing the policy. The evidence presented by the Department regarding the "additional liability coverage" purchased by Ms. Shaffer is scanty. Although Ms. Shaffer handled the transaction over the telephone with a man in the Pompano Beach office of the insurance agency and the charge on Ms. Shaffer's credit card was credited to the A Able insurance agency in Pompano Beach, there is no evidence identifying the person who prepared the receipt for the premium payment. The totality of the evidence presented by the Department is not sufficient to support an inference that Mr. Pomerantz was personally involved in the transaction or that he knew or should have known of the transaction. Count IV: Terensinha Honczarenko The evidence presented by the Department is not sufficient to establish that Mr. Pomerantz caused Ms. Honczarenko's automobile insurance policy to be cancelled, either directly or through his negligence or the negligence of any of the agents working in the A Able insurance agency Pompano Beach office. All of her dealings were with the Margate office, and there was no evidence that a copy of the notice from Southern Group advising Ms. Honczarenko that she owed additional premium on her policy was sent to the A Able insurance agency at the Pompano Beach address or that it was the practice of Southern Group to send such notices to agents as well as to its insureds.16 The evidence presented by the Department is, however, sufficient to establish that A Able insurance agency received notice from ETI Finance that it owed Ms. Honczarenko a refund of unearned return premium in the amount of $71.95 and that Ms. Honczarenko did not receive this refund. Counts V, VI, VII, VIII, IX, and X: Mr. Worrall, Ms. Mousel, Mr. Hublitz, Ms. O'Connell, Ms. Scott, and Ms. Misconis The evidence presented by the Department is sufficient to establish that Mr. Pomerantz was personally responsible for writing agency checks for premium net commission and for sending applications for automobile insurance coverage generated in the A Able insurance agency Pompano Beach office and premium checks received in that office to the various insurance companies. During the summer and early fall of 2002, Ms. High constantly reminded Mr. Pomerantz that the applications accumulating on his desk needed attention, and Mr. Pomerantz assumed the responsibility for handling the applications when he told her that he would handle them. The evidence presented by the Department is also sufficient to establish that Mr. Pomerantz failed to forward the applications and premiums for Mr. Worrall, Ms. Mousel, Mr. Hublitz, Ms. O'Connell, Ms. Scott, and Ms. Misconis and that the A Able insurance agency had the benefit of the premium payments made by these individuals from the time the coverage binders expired until such time as the policy applications and payments were received by the various insurance companies who issued policies with coverage retroactive to the date of the applications and premium payments. Count XI: Ms. Carroll The evidence presented by the Department is not sufficient to establish with the requisite degree of certainty that either Mr. Pomerantz or any employee of the Pompano Beach office of the A Able insurance agency was involved in the transactions with respect to Ms. Carroll's automobile insurance policy with Aires. All of Ms. Carroll's business dealings with regard to this policy were at the Margate office of the Wide World of Insurance insurance agency. Even though the name "A Able Wide World of Insurance" appears on the letter dated November 27, 2002, notifying Ms. Carroll that Aires was in liquidation and that she needed to replace her automobile insurance policy, there was no evidence presented to establish that anyone in the Pompano Beach office prepared the application for Ms. Carroll's policy or had any dealings with her on this or any other automobile insurance policy.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Financial Services enter a final order finding that Jay Lawrence Pomerantz 1. Violated Sections 626.561(1), 626.611(4), (7), and (10), and 626.621(2) and (6), Florida Statutes (2002) with respect to Counts I, IV, V, VI, VII, VIII, IX, and X of the Amended Administrative Complaint filed October 14, 2003; Dismissing Counts II, III, and XI of the Amended Administrative Complaint20; and Revoking the property and casualty insurance agent's license of Jay Lawrence Pomerantz. DONE AND ENTERED this 30th day of April, 2004, in Tallahassee, Leon County, Florida. S 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 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of April, 2004.
