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.
Findings Of Fact Based upon the evidence adduced at hearing, and the record as a whole (including the admissions made by Respondent), the following Findings of Fact are made: Background Information Respondent is now, and has been since 1978, licensed by Petitioner as a general lines insurance agent. During the period of her licensure, Petitioner has not taken any disciplinary action against her. Professional Future Development Corporation (hereinafter referred to as "Professional") is an insurance agency located at 2234 Northwest 2nd Avenue in Miami, Florida. Respondent owns and works as an insurance agent for Professional. Count I Joseph Ha is the owner of Dashiwa Corporation. Dashiwa Corporation operates the Liberty Flea Market in Miami, Florida. Ha enlisted Respondent's services to obtain workers' compensation insurance for his business. 3/ In November and December of 1993, Ha provided Respondent with monies (in the form of checks made out to Professional) to be used to pay the premiums for such insurance. Respondent deposited the checks in Professional's bank account. She did not properly and promptly (in the regular course of business) remit the premium payments to the insurer. Instead, without Ha's consent, she used these monies to help pay the medical expenses of a cousin who had AIDS. As a result of Respondent's dereliction, Ha's business was without the workers' compensation insurance coverage Respondent was supposed to obtain for him. Respondent has yet to make a complete refund of the monies Ha provided her to obtain such coverage. Count II On or about December 21, 1993, Rene Hernandez, on behalf of his mother, Gloria Hernandez, provided Respondent with a down payment (in the amount of $251.00) for insurance that Respondent was to obtain for an automobile owned by Gloria Hernandez. The balance of the premium was to be financed by a premium finance company. Respondent failed to take the necessary steps (in the regular course of business) to obtain insurance for Gloria Hernandez's automobile. In March of 1994, Hernandez's automobile was involved in an accident. As of the date of the accident, Respondent had neither obtained insurance for the automobile, nor had she refunded (in the regular course of business) the monies she had been given to obtain such insurance. Following the accident, in June of 1994, Respondent finally secured coverage for Hernandez's automobile Count III On or about August 15, 1994, Jacquetta Jackson provided Respondent with a down payment for insurance that Respondent was to obtain for an automobile that Jackson owned. The application for such insurance coverage was bound on or about that same day. Respondent submitted the application (on an outdated form) to Bankers Insurance Company (as a member of the Florida Automobile Joint Underwriting Association) on or about November 14, 1994. The application was accompanied by a "sight-draft" from a premium finance company in an amount less than the gross premium that was due for the requested insurance coverage. Rule 2B of the Rules of General Practice of the Florida Automobile Joint Underwriting Association provides that premiums are to be submitted to the insurer on a gross remittance basis within one business day after the application for coverage is bound. Respondent failed to comply with the requirements of Rule 2B in her efforts to obtain automobile insurance for Jackson. By letters dated November 14, 1994, and December 20, 1994, Bankers Insurance Company notified Respondent that it had rejected the application she had submitted on behalf of Jackson because the application had been submitted on an outdated form and had not been submitted in accordance with the requirements of Rule 2B. It was not until January 18, 1995, that Respondent submitted another application to Bankers Insurance Company on behalf of Jackson. 4/ The insurance that Jackson had requested was finally obtained on February 28, 1995 (from Fortune Insurance Company by another insurance agent to whom Respondent had transferred the matter). Respondent never advised Jackson, during the period that Jackson was without coverage (from on or about August 15, 1994, to February 28, 1995), that the requested insurance had not been obtained. Count IV On or about September 26, 1994, Roderick Cole provided Respondent with a down payment for insurance that Respondent was to obtain for an automobile that Cole owned. The application for such insurance coverage was bound on or about that same day. Respondent submitted the application (on an outdated form) to Bankers Insurance Company (as a member of the Florida Automobile Joint Underwriting Association) on or about November 14, 1994. The application was accompanied by a "sight-draft" from a premium finance company in an amount less than the gross premium that was due for the requested insurance coverage. Respondent failed to comply with the requirements of Rule 2B in her efforts to obtain automobile insurance for Cole. Bankers Insurance Company subsequently notified Respondent by letter that it had rejected the application she had submitted on behalf of Cole because the application had been submitted on an outdated form and had not been submitted in accordance with the requirements of Rule 2B. It was not until January 18, 1995, that Respondent submitted another application on behalf of Cole. The insurance that Cole had requested was finally obtained on March 7, 1995 (from Fortune Insurance Company by another insurance agent to whom Respondent had transferred the matter). Respondent never advised Cole, during the period that Cole was without coverage (from on or about September 26, 1994, to March 7, 1995), that the requested insurance had not been obtained.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that Petitioner enter a final order: (1) finding Respondent guilty of the violations noted in the Conclusions of Law of this Recommended Order; (2) penalizing Respondent for having committed these violations by revoking her license; and (3) dismissing the remaining allegations of misconduct advanced in the Administrative Complaint. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 5th day of December, 1996. STUART M. LERNER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 5th day of December, 1996.
The Issue The issue addressed in this proceeding is whether Respondent's life, health, life and health and general lines insurance agent's licenses should be suspended, revoked, or otherwise disciplined for violations of Chapter 626, Florida Statutes.
Findings Of Fact Respondent is currently licensed in this state as a life agent, as a health agent, as a life and health agent, and as a general lines agent, Respondent was so licensed in 1993. In 1993, Respondent was doing business as John Drew Insurance Group (Group). Group was and remains a general lines insurance agency located in Panama City, Florida. Around October 4, 1993, Trilby L. Williams of Panama City, Florida phoned Respondent and sought a quotation for homeowners insurance on her mobile home. Respondent specifically requested a quotation for coverage on the mobile home. She did not seek any other insurance or non-insurance product or service from Respondent. Respondent provided a phone quotation of $490.00. During the conversation Respondent described only coverage under the mobile home policy. He did not describe any other insurance coverage or membership in a travel or auto club. Ms. Williams advised Respondent she would accept the quotation and made arrangements to go to Respondent's agency to complete the transaction. Around October 6, 1993, Ms. Williams and her husband, Robert L. Williams went to the office of the Group. The Williams' met with Dana Baxter Watkins, an unlicensed employee of the agency working under Respondent's direct supervision and control. Respondent was not present. However, Ms. Watkins was expecting the Williams. Respondent had left her the Williams' file and paperwork for the mobile home insurance plus an ancillary product. Mr. Williams signed an application for a mobile home insurance policy to be issued by American International Insurance Company through the Florida Residential Property and Casualty Joint Underwriting Association (FRPCJUA). The premium for the mobile home policy was $400.00 which was tendered to Group by Robert and Trilby Williams. Since Respondent had binding authority with the FRPCJUA, he bound the mobile home coverage effective October 6, 1993, at 9:45 A.M. Ms. Watkins also had Robert L. Williams execute a contract for and purchase an American Travelers Association (ATA) ancillary product without the informed consent of Robert or Trilby Williams. Mr. and Ms. Williams were led to believe through Ms. Watkins' statements that they were required to purchase the ATA ancillary product in order to be eligible to purchase the mobile home coverage. Ms. Watkins advised the Williams that "they didn't make any money on the homeowners' policies and that they had to sell this policy." Ms. Watkins explained the ATA ancillary product as an accident benefit policy. The Williams understood the product to be some sort of accident insurance policy designed to provide Ms. Williams with benefits in the event Mr. Williams were to have an accident around their mobile home. The fee for the ATA ancillary product was $90.00, which was paid to Group by Robert and Trilby Williams on October 6, 1993. Robert and Trilby Williams believed that the entire $490.00 which they paid to Group on October 6, 1993, was premium monies required for the purchase of the mobile home insurance policy. The ATA ancillary product is in fact a "motor club" membership as defined in Section 624.124, Florida Statutes, The motor club provides certain benefits of membership such as rewards to witnesses in the event of the theft of the member's private passenger vehicle, travel agency services, rental car discounts, and very circumscribed accidental death and dismemberment coverage for accidental death and qualifying dismemberments while the insured is a passenger in a private passenger automobile. An example of a qualifying dismemberment is the loss of a finger, but only if the digit is a thumb or index finger and only if it is severed through or above the joint closest to the wrist. The cost of the ATA motor club varies from $20.00 to $100.00 depending on the level of benefits selected. Commissions on such products are approximately eighty (80) to ninety (90) percent of the price charged to the consumer. Shortly after departing Respondent's agency Robert and Trilby Williams became concerned about having been required to purchase the ATA "policy". Ms. Williams telephoned Respondent to request a refund of the $90.00 fee they had paid. Respondent informed Robert and Trilby Williams that they could not purchase the mobile home insurance policy without purchasing the ATA ancillary product and again reiterated that "they make very little or no profit selling homeowners or mobile home . . . insurance and that they needed this in order to make overhead." When Ms. Williams, in a somewhat nasty manner, persisted in her request for a refund of the $90.00 ATA fee and threatened to contact the Department of Insurance, Respondent decided he did not wish to do business with the Williams and informed Ms. Williams that he would refund the entire $490.00. Respondent cancelled the American mobile home policy and refunded the entire $490.00 paid by the Williams. However, there was no question that Respondent would not have sold the mobile home insurance without the ATA club membership. At no time did either Williams' authorize the cancellation of the mobile home policy. As a result of the cancellation, Mr. and Ms. Williams were without an insurance policy on their mobile home for approximately a week. Additionally, because the policy had been bound, the FRPCJUA was exposed to a risk of loss for that period of time for which they received no premium. Around September 13, 1993, Doris Steen of Panama City, Florida phoned Respondent and sought a quotation for homeowners insurance on her mobile home. Respondent specifically requested a quotation for coverage on her mobile home. She did not seek any other insurance or non-insurance product or service from Respondent. Ms. Steen and her husband were members of another auto club and did not need a second membership. Around September 15, 1993, Ms. Steen went to the office of the Group. She was met by Dana Baxter Watkins. Ms. Watkins had Ms. Steen's file and paperwork for mobile home coverage and membership in ATA. Ms. Steen signed an application for a mobile home insurance policy to be issued by American through FRPCJUA. The premium for said policy was $277.00, which was tendered to Group by Doris Steen. The coverages applied for were bound effective September 15, 1993. Ms. Watkins also had Doris Steen purchase an ATA ancillary product without Doris Steen's informed consent. Ms. Steen was led to believe through Ms. Watkins' statements that she was required to purchase the ATA ancillary product as part of a package which included the mobile home policy and the one was not available without the other. Ms. Watkins explained the ATA ancillary product as an accident and life insurance policy and Ms. Steen understood the product to be a life insurance policy to cover her if she were killed at her mobile home. The fee for the ATA ancillary product was $100.00, which was paid to Group by Doris Steen on September 15, 1993. The ATA ancillary product sold to Ms. Steen was the same motor club product sold to the Williams. Dana Baxter Watkins was under the direct supervision of Respondent and was trained by Respondent to sell ATA motor club memberships in accordance with a routine business practice implemented by Respondent to increase his agency revenues. In furtherance of the business practice Respondent developed a chart that indicated what price to charge for the ATA motor club given a particular premium level for the mobile home insurance being purchased. The higher the premium for the insurance the less the charge for the motor club. From the charge for the motor club, Respondent would back into the level of benefits provided rather than choosing a level of benefits and then determining the cost. In short, the cost of the ATA policy had nothing to do with the insured's needs. Respondent instructed Ms. Watkins to give mobile home insurance quotations over the phone which included both the mobile home insurance premium and the cost of the motor club as determined by using the chart. No disclosure of the motor club was made at the time of the phone quotation. When consumers came into the office to purchase the coverage they were required to purchase the motor club in conjunction with the insurance and were lead to believe that the two items were a package. The motor club was routinely misrepresented to be some sort of insurance product. In fact, Ms. Watkins was unaware that the ATA product was in fact a motor club rather than an insurance policy. Respondent focused on the accidental death and dismemberment benefit included with the memberships when describing the product to Ms. Watkins and to any consumer that questioned the paperwork. Respondent maintained his inaccurate description of the ATA product at the hearing. Respondent justified the requirement to purchase the ATA motor club on the basis that his commission for the sale of mobile home insurance was too small to cover agency expenses and the sale of the motor club membership made up the small commission on mobile home insurance. In the instant case, Respondent's acts and those undertaken by Ms. Watkins at his direction constituted routine, deceptive, fraudulent and unfair business practices in violation of Chapter 626, Florida Statutes. The deceptive, fraudulent aspect of Respondent's practice makes the violations particularly serious. Respondent offered no credible evidence of mitigation for his business practice. Respondent was disciplined by the Department in 1976 for charging a cancellation fee in violation of the Florida Insurance Code. There he justified the charge on the basis that he was not adequately compensated by commission when policies were cancelled mid-term. Respondent was again disciplined by the Department in 1992 for having collected a "consulting fee" in violation of the Florida Insurance Code. Given the deceptive, fraudulent nature of Respondent's business practice and the previous discipline of Respondent's license, Respondent's license should be revoked.
Recommendation Based upon the foregoing Findings of Fact and the Conclusions of Law, it is accordingly, RECOMMENDED that Respondent, John Walter Drew, be found guilty of the violations set forth in the Conclusions of Law portion of this Order and that the Respondent's license as an insurance agent in this State be revoked and he be ordered to pay a fine of $5,000 within thirty (30) days of entry of the Final Order in this matter. DONE and ENTERED this 5th day of April, 1995, in Tallahassee, Florida. DIANE CLEAVINGER 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 5th day of April, 1995. APPENDIX The facts contained in paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 and 38 of Petitioner's proposed findings of fact are adopted in substance, insofar as material. The facts contained in paragraphs 3 and 11, are adopted in substance, insofar as material. Paragraphs 1, 2, 6, 7, 8 and 9 of Respondent's proposed findings of fact pertain to either procedural matters or are legal argument. The facts contained in paragraphs 4, 5, 10, 12, 13, 14, and 18 of Respondent's proposed findings of fact are subordinate. The facts contained in paragraphs 15, 16, and 17 of Respondent's proposed findings of fact were not shown by the evidence. COPIES FURNISHED: John R. Dunphy, Esq. Michael McCormick, Esq. Division of Legal Services 612 Larson Bldg. Tallahassee, FL 32399-0333 Charles P. Hoskins, Esq. Wells, Brown & Brady, P.A. P. O. Box 12584 Pensacola, FL 32573-2584 Bill Nelson State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, FL 32399-0300 Dan Sumner Acting General Counsel Dept. of Insurance The Capitol, PL-11 Tallahassee, FL 32399-0300
The Issue The issue for determination is whether Respondent used its best efforts to obtain and maintain adequate property insurance and whether adequate property insurance includes windstorm coverage.
Findings Of Fact The Carillon Association is a Florida not-for-profit corporation organized in 1966. Carillon Condominium consists of eight units. The units are owned by seven unit owners and controlled by the Carillon Association.3 Carillon Condominium is located in Miami Beach, Florida. During its existence of more than 40 years, Carillon Condominium has survived Florida's tropical storms, depressions, hurricanes, and other forms of wind and rain. At the time of the hearing, the Carillon Association was governed by a three-member board, consisting of a president, secretary, (who is also the legal counsel), and treasurer. Section XXVI of the Carillon Condominium's Declaration of Restrictions, Reservations, Covenants, Conditions and Easements (Declaration), titled "Casualty Insurance," provides in pertinent part: Purchase of Insurance: The association shall obtain fire and extended coverage insurance and vandalism and malicious mischief insurance insuring all of the insurable improvements within the condominium, together with such other insurance as the association deems necessary in and for the interest of the association, all unit owners, and their mortgagees, as their interests may appear, in a company, Triple A - best rating or better, in an amount which shall be equal to the maximum insurable replacement value as determined annually; and the premiums for such coverage and other expenses in connection with said insurance shall be assessed against the unit owners as part of the common expenses. * * * (4) Loss Less than "Very Substantial": Where a loss or damage occurs to more than one unit, or to the common elements, or to any unit or units, and the common elements, but said loss is less than "very substantial" (as hereinafter defined), it shall be obligatory upon the association and the unit owners to repair, restore and rebuild the damage caused by said loss. Where such loss or damage is less than "very substantial": * * * In the event the insurance proceeds are sufficient to pay for the cost of restoration and repair, or in the event the insurance proceeds are insufficient but additional funds are raised by special assessment within forty-five days after the casualty, so that sufficient funds are on hand to fully pay for such restoration and repair, then no mortgagee shall have the right to require the application of insurance proceeds to the payment of its loan; provided, however, that this provision may be waived by the Board of Directors in favor of any institutional first mortgages upon request thereof at any time. To the extent that any insurance proceeds are required to be paid over to such mortgagee, the unit owner shall be obliged to replenish the funds so paid over, and said unit owner and his unit shall be subject to special assessment for such sum. Notwithstanding the foregoing provision, any institutional mortgagee shall have the right to require payment to it, and apply against the mortgage, any insurance funds to the extent of its interest therein. The Carillon Condominium's By-Laws provides in pertinent part: Article II Directors * * * Section 5. Powers: The property and business of the corporation shall be managed by the Board of Directors, which may exercise all corporate powers not specifically prohibited by statute, the Certificate of Incorporation, or the Declaration to which these By-Laws are attached. The powers of the Board of Directors shall specifically include, but not be limited to, the following: To make and collect assessments and establish the time within which payment of same are due; To use and expend the assessments collected to maintain, care for and preserve the units and condominium property, except those portions thereof which are required to be maintained, cared for and preserved by the unit owners; * * * E. To insure and keep insured said condominium property in the manner set forth in the Declaration, against loss from fire and/or other casualty, and the unit owners against public liability, and to purchase such other insurance as the Board of Directors may deem advisable . . . . * * * Section 7. Meetings: * * * Special meetings shall be held whenever called by the direction of the President or a majority of the Board. The Secretary shall give notice of each special meeting either personally, by mail or telegram, at least three (3) days before the date of such meeting, but the directors may waive notice of the calling of the meeting; A majority of the Board shall be necessary and sufficient at all meetings to constitute a quorum for the transaction of business, and the act of the majority present at any meeting at which there is a quorum shall be the act of the Board. . . . * * * Article VII Finances * * * Section 3. Determination of Assessments A. The Board of Directors of the corporation shall fix and determine from time to time the sum or sums necessary and adequate for the common expense of the condominium property. Common expenses shall include expenses for the operation, maintenance, repair or replacement of the common elements . . . all insurance premiums and expenses relating thereto, including fire insurance, and any other expenses designated as common expense from time to time by the Board of Directors of the corporation. . . Funds for payment of common expenses shall be assessed against the unit owners in the proportions or percentages of sharing common expenses provided in the Declaration . . . Special assessments, should such be required by the Board of Directors, shall be levied and paid in the same manner as heretofore provided for regular assessments. . . . At all times material hereto, John Hillman was president of the Carillon Association. He has served as president for the past ten years. Additionally, he owns two units and has owned one of his two units for approximately 20 years. At all times material hereto, Lily Carico was treasurer of the Carillon Association. At all times material hereto, except from March 2010 forward, Peter Neofotistos was vice president of the Carillon Association. In March 2010, he resigned as vice president. At the end of each year for the past 20 years, the treasurer prepared a financial statement, i.e., an Annual Report, setting forth the annual budget based upon credits and debits, which was provided to each unit owner. The next year's budget was determined based upon the previous year's, resulting in essentially last year's budget becoming the next year's budget, and was financed by each of the owner's respective quarterly maintenance payments. For the past ten years, no annual budget meetings were noticed and held. Any extraordinary expenses for the past 20 years resulted in a special assessment to each unit owner, based upon each unit owner's ownership interest in the Carillon Condominium. For the past 20 years, the Carillon Association never charged or collected reserves for repair or replacement of items. Furthermore, for that same period of time, none of the unit owners requested a meeting to establish a reserve account. No evidence was presented as to whether, during the 20-year period or prior thereto, a majority of the unit owners voted to have no reserves. At all times material hereto, the Carillon Association purchased and maintained general premises liability coverage and all-risk coverage, including, but not limited to, fire, theft vandalism, vehicle, collapse, lightning, terrorism, and equipment breakdown coverage on the Carillon Condominium. The insurance premium for the all-risk policy in 2009 was $2,390.00 and in 2010 was $2,331.37. Sometime in 2006, Mr. Neofotistos suggested to Mr. Hillman the obtaining of insurance, covering wind and flood damage, by the Carillon Association in light of the recent hurricane activity. Mr. Hillman agreed in principle and that such insurance coverage might be something to explore. In 2006, unit owner Peter Neofotistos elected to use his one unit as collateral to secure a bank loan. He advised Mr. Hillman that his lender required a wind and flood insurance policy for the Carillon Condominium and that he (Mr. Neofotistos) acquired a master wind and flood insurance policy covering the Carillon Condominium at a cost of $3,740.00. Subsequently, Mr. Neofotistos made a demand for reimbursement of the $3,740.00. Mr. Hillman refused to reimburse Mr. Neofotistos mainly because the directors of the Carillon Association had not authorized and approved for Mr. Neofotistos to obtain the coverage for the Carillon Association. In 2009, unit owner Mario Sesma elected to use his one unit as collateral to secure a bank loan. The Carillon Association agrees that Mr. Sesma advised Mr. Hillman (a) that his lender was requiring a windstorm insurance policy for the loan; (b) that he (Mr. Sesma) was unable to pay for the windstorm insurance coverage; and (c) that the coverage would be considerably less if the Carillon Association had a master windstorm policy. Mr. Sesma advised Mr. Hillman further that the lender obtained a lender-placed flood insurance policy at a cost of $3,090.00 to Mr. Sesma. In April 2009, the roof at the Carillon Condominium required replacing due to leaks and age (ten years old). The unit owners were given notice of a special assessment in the amount of $15,285.70 for replacement of the roof. In 2009, Ms. Carico contacted the Carillon Association's long-time and current insurance agent for a quote on windstorm and hail insurance for the Carillon Association. She contacted the insurance agent upon learning of Mr. Sesma's request for the Carillon Association to obtain windstorm insurance. In September 2009, the insurance agent advised Carillon Association that one of the eligibility requirements for the insurance was an appraisal of the Carillon Condominium. Mr. Hillman requested the unit owners, who had forced-coverage by the lending institutions, to provide a copy of their appraisal in an effort to save money on the appraisal. The unit owners did not respond to his request. Additionally, in September 2009, the insurance agent provided a quote for the insurance coverage--the total estimated cost of the insurance was $4,012.00. However, he advised the Carillon Association that the estimate would fluctuate up or down depending upon the appraisal. The Carillon Association did not obtain an appraisal on the Carillon Condominium's common property. The Carillon Association's legal counsel, Jill Hillman, who was the daughter of Mr. Hillman and also a unit owner, advised the Carillon Association that windstorm insurance was not mandated by law. Ms. Carico conducted an informal poll of unit owners as to whether they wished the Carillon Association to purchase windstorm insurance for the Carillon Condominium. She did not want to purchase the insurance and was aware that Mr. Hillman and Ms. Hillman did not. Also, Ms. Carico asked two other unit owners, who indicated that they, too, did not want to purchase the insurance. As a result, five of the seven unit owners (also equating to six of the eight units), a majority, did not want to purchase windstorm insurance for the Carillon Condominium. After consultation with Ms. Hillman, acting as the Carillon Association's legal counsel, and the insurance agent, Mr. Hillman and Ms. Carico decided not to purchase the windstorm insurance quoted by the insurance agent. At all times material hereto, the Carillon Association did not have sufficient funds to purchase windstorm insurance. Moreover, the majority of the unit owners were unwilling to pay an assessment to purchase the windstorm insurance. The issue as to whether to purchase the windstorm policy quoted by the insurance agent or a windstorm policy from any other source was never brought to a formal board meeting as an agenda item at a duly called board of directors meeting or to a unit owner meeting. In or around June 2010, the water heater at Carillon Condominium required replacing on an emergency basis. The replacement cost was $5,200.00, which was funded with a special assessment upon all of the unit owners. Due to the immediacy of the situation, no board meeting and no unit owner's meeting was held; the replacement decision was made by the Carillon Association's president and treasurer. On or about July 29, 2010, Mr. Hillman sent a notice and the 2009 Annual Report to unit owners. The notice indicated, among other things, that three unit owners were in arrears, with two of the unit owners being Messrs. Neofotistos and Sesma. Mr. Neofotistos' arrearage was in the amount of $3,219.74, and Mr. Sesma's arrearage was in the amount of $2,586.40. Three board members of the Carillon Association own, cumulatively, four of the eight units. Only their units are free and clear of any mortgage.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Florida Condominiums, Timeshares and Mobile Homes enter a final order: Finding that Carillon Condominiums, Inc., did not violate section 718.111(11)(d), Florida Statutes (2009); and Rescinding the Notice to Show Cause. DONE AND ENTERED this 1st day of August, 2011, in Tallahassee, Leon County, Florida. S ERROL H. POWELL 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 1st day of August, 2011.
The Issue Whether or not on or about February 17, 1969, the Respondent, Everett A. Harper, caused to be issued to Florida Pallet Corporation, by the Employers' Fire Insurance Company, a policy covering the business vehicles of Florida Pallet Corporation for which Harper received premiums from the insured on a monthly basis. Further, whether or not Harper failed to deliver or transmit the premiums to the insurer, resulting in the policy being cancelled flat for non- payment of premiums. Whether or not Harper failed to inform the insured of the cancellation of the policy, but nevertheless continued to receive the insured's premium payments monthly, without causing to be issued insurance coverage for Florida Pallet Corporation with another insurer. Finally, whether or not in July, 1969, a truck of the insured, Florida Pallet Corporation, was involved in an accident in which a claim was filed and in which Harper failed to advise the insured of the policy cancellation that had occurred a few months prior to the accident, and until February, 1970, continued receiving and accepting premiums. These acts are alleged to have been accepting premiums. Section 475.25(1)(a), Florida Statutes, as being acts which show the Respondent to be guilty of fraud, misrepresentation, concealment, dishonest dealing, trick, scheme or device and/or breach of trust in the business transaction. The acts also have allegedly constituted a violation of Section 475.25(1)(c), Florida Statutes, as being acts which show the Respondent to be guilty of failing to account for or deliver moneys which have come into his hands, which were not his, and which he was not entitled to retain, under the circumstances; thereby constituting conversion of those moneys. The Petitioner has an additional contention under Section 475.25(3), Florida Statutes, to the effect that the acts as alleged constitute a course of conduct in violation of the purpose and intent of the section immediately referenced.
Findings Of Fact The Respondent, Everett A. Harper, is a Registered Real Estate Broker, who presently holds a non-active certificate of registration, giving an address of P. O. Box 1238, Sanford, Florida 32771. This non-active certificate of registration is held with the Petitioner, Florida Real Estate Commission. From October 1, 1968, until April 29, 1970, which includes the time of the alleged acts of misconduct, the Respondent was the holds of a broker's certificate as a individual broker under the trade name "Harper-Gentry Real Estate," with office at 2465 South Park Avenue, Sanford, Florida 32771. In that same period the Respondent, Everett A. Harper, was the holder of a General Lines Insurance Agent's license held with the Treasurer's Office of the State of Florida. While operating the insurance business, in February, 1969, the Respondent entered into an agreement with the Florida Pallet Corporation to obtain insurance coverage for the motor vehicles which were owned by the corporation. The arrangement between Harper and the corporation was to have the corporation pay an initial installment to activate that policy and to make monthly premiums in the future. The initial payment was made and Harper contacted the Employers' Commercial Union Companies, specifically the Employers' Fire Insurance Company, for purposes of having those companies insure that Florida Pallet Corporation for its automobile liability, in addition to Workmen's Compensation and general liability. (These latter two categories were apparently at the request of the Florida Pallet Corporation, although no testimony by their former president was presented from the representative of the insurance company, who testified in the course of the hearing.) The facts further revealed that once the Orlando branch of the Employers' Commercial Union Companies had received the request for insurance, they declined coverage on the Workmen's Compensation and general liability portions of the request, but issued an automobile liability policy, subject to background checks on the prospective drivers' records and engineering reports. The automobile policy was issued to the Respondent's insurance agency. Within ten days to two weeks of the date of the issuance, the insurance company asked the Harper agency to return the automobile policy for cancellation because the background check had led the insurance company to decline the coverage. This request was honored by Everett A. Harper when he returned the policy with the indication "cancelled flat." This form of cancellation was allowed because no claim had been filed against the policy prior to the date of the cancellation. The effect of the cancellation of the automobile policy was to cancel the policy from the date of inception. It also meant that the insurance company, to wit, the Employers' Commercial Union Companies, was not entitled to collect any moneys as premium payments, nor was Everett A. Harper entitled to keep those premium payments which he had received up to that moment or future premium payments which he might have received under the policy which has been alluded to. Harper could have placed a request for coverage with other companies if he had so desired. In fact, he did not make such a placement and kept the initial payment of premiums and continued to receive premiums over a period of the year 1969. The Florida Pallet Corporation was not notified of the cancellation of the policy or of Harper's failure to place their request for policy with another company, or the fact that Harper continued to receive the premium payments, which amounted to $1,270.00 a year for the automobile coverage. In addition, Harper neglected to advise the Florida Pallet Corporation that they were not covered by any insurance plan for their automobile liability needs. Some six or eight months after the policy had been cancelled, one of the vehicles belonging to the Florida Pallet Corporation was in an accident, which necessitated protection under an insurance policy. Harper still failed to indicate the cancellation of the policy, the lack of placement of the coverage with a new company, and the fact that no coverage existed, when requested to protect the interests of the Florida Pallet Corporation. This request was made by the president of that corporation, Leo Voskan. Eventually, Voskan made an inquiry of the Employers' Commercial Union Companies in February, 1970, and was told that there was no coverage, in view of the fact that the policy had been cancelled at a time prior to any authorized claim being filed. The claim arising from the automobile accident in 1969, involving the vehicle of the Florida Pallet Corporation, was paid by Harper, at a date beyond the time of the inquiry mentioned of February, 1970. Under the facts as developed, Harper should have returned the premium payments to the Florida Pallet Corporation, indicating the fact of the lack of coverage by the Employers' Commercial Union Companies, or in the alternative, placed coverage with another insurance company. The failure to return those premium payments, or arrange for a policy with another company, and the failure to advise the Florida Pallet Corporation of their lack of coverage, show the Respondent, Everett A. Harper, to be guilty of fraud, misrepresentation, concealment, dishonest dealing, trick, scheme or device and/or breach of trust in a business transaction in violation of the provisions of Section 475.25(1)(a), Florida Statutes. It also shows that the Respondent, Everett A. Harper, is guilty of failing to account for or deliver moneys which have come into his hands, which were not his and which he was not entitled to retain, under the circumstances, of which he converted, in violation of Section 475.25(1)(c), Florida Statutes. Finally, these facts establish that the Respondent, Everett A. Harper, is guilty of a course of conduct or practice which shows that he is so dishonest and untruthful that the money, property, transactions and rights of investors or those with whom he may sustain a confidential relation, may not be safely entrusted to him; in violation of Section 475.25(3), Florida Statutes.
Recommendation Based upon a review of the facts as offered in this cause, it is, RECOMMENDED: That the non-active real estate broker's registration of the Respondent, Everett A. Harper, be REVOKED. DONE and ENTERED this 18th day of August, 1978, in Tallahassee, Florida. CHARLES C. ADAMS, Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: John Huskins, Esquire Staff Attorney Florida Real Estate Commission Post Office Box 1900 Orlando, Florida 32802 Everett A. Harper Post Office Box 1238 Sanford, Florida 32771
The Issue The issue presented is whether Respondent, a licensed insurance agent, is guilty of violating the statutes regulating the conduct of an insurance agent, and if so, what disciplinary action should be taken against him, if any.
Findings Of Fact At all times material hereto, Respondent has been eligible for licensure and licensed as a life and health insurance agent and as a dental health care contract salesman. For many years, Respondent had also been licensed to solicit general lines -- property, casualty, surety, and miscellaneous lines -- insurance in this state. Respondent was unaware that this license expired on March 24, 1987. At all times material hereto, Respondent was, however, eligible for licensure as a general lines agent. At all times material hereto, Respondent was one of the officers of Johnson's Model City Insurance Agency #1, Inc., a Florida corporation. That corporation was involuntarily dissolved on November 4, 1988. On December 30, 1986, Respondent telephoned Petitioner to discuss the propriety of an insurance agent charging a consulting fee. Following that telephonic conversation, an attorney for Petitioner directed correspondence to Respondent confirming that telephone conversation, advising that a consulting fee could legally be charged under certain circumstances. Those circumstances included the use of a separate consulting contract between the agent and the insured so that the insured would fully understand that he or she was entering into a separate contract and paying a separate consideration in advance of the performance of consulting services. Additionally, the services rendered must be other than those normally provided by an insurance agent. Further, if a separate consulting contract were effectuated, an agent could set up a separate consulting corporation to enter into such contracts. Hartford Insurance Company sells automobile insurance in the State of Florida by use of a toll-free telephone number. People who know the telephone number can call Hartford directly, obtain a quote for automobile insurance, and purchase a policy directly from Hartford. Hartford has no insurance agents in the State of Florida and pays no commissions to insurance agents in Florida for the obtaining of automobile insurance customers. A person can obtain a quote in writing from the Hartford in advance of purchasing a policy. Sometimes, the quotation card and the policy are issued and mailed simultaneously by Hartford to its new insureds. On September 20, 1987, Patricia Moss telephoned J. M. C. Insurance Consultants pursuant to an ad in the telephone yellow pages. She inquired about obtaining automobile insurance to replace her current policy which would expire on September 22, 1987. She spoke with an employee named Betty who advised her that she could obtain replacement insurance at a cost of $927. Since the cost quoted to her was substantially lower than the prices she had been quoted by the other agencies she had consulted, Moss went to the offices of J. M. C. on September 21, 1987. Betty presented Moss with a number of documents to sign. She signed a Power of Attorney appointing Johnson's Model City Insurance, Inc., doing business as JMC Insurance Consultants as her attorney-in-fact to obtain insurance for her, specifically ratifying and confirming actions taken on her behalf by J. L. Johnson- consultant. She also executed an Agreement with Consultant specifying the services that JMC Insurance Consultants would perform on her behalf. She signed a further statement which provided that: "I understand that JMC Insurance is acting as Consultants for my insurance placement and is entitled to any and all consultation fees." She also signed a document written in boldfaced type which states: IMPORTANT NOTICE THIS LETTER IS TO INFORM YOU THAT JMC INSURANCE CONSULTANTS ARE NOT AGENTS NOR DO WE REPRESENT HARTFORD INSURANCE COMPANY IN ANY WAY WHATSOEVER. WE REPRESENT "YOU" THE CLIENT AND WE ACT IN YOUR BEHALF WITH THE RIGHT THAT YOU GIVE US THROUGH A POWER OF ATTORNEY. WE ENDEAVOR TO PLACE YOUR AUTO INSURANCE FOR YOU ON YOUR BEHALF. WE ARE YOUR CONSULTANT. IF YOU HAVE A PROBLEM PLEASE CALL US WE ARE HERE TO HELP AND ACT IN YOUR BEHALF. CALL US FIRST. LET US HANDLE IT. CLIENT. I HAVE READ AND I UNDERSTAND. Moss gave JMC Consultants a check in the amount of $262.50 for which she was given a receipt which carried the specific notation that the money she had paid was for an insurance consultant's fee. She was also given a small card entitled Insurance Identification Card on which Betty filled in information showing that she would be insured by Hartford effective on the following day and specifically describing the coverage provided, the automobile insured, and the name and address of Moss. Within a week she received directly from the Hartford an insurance policy for the benefits which she sought. The policy itself reflected that the premium for the policy was $632 and that she would be receiving a bill from Hartford for that amount. She telephoned Betty, demanding a refund of her $262.50, which demand was refused. Betty explained to her that the amount was for the consultant's fee for obtaining the low- cost coverage for Moss. Hartford's direct marketing program does allow people to purchase insurance on someone else's behalf utilizing a Power of Attorney. Although Hartford's records do not reflect a Power of Attorney from Moss to J. M. C. Consultants or Respondent, Hartford's records regarding their policyholder Moss are not accurate. For example, they erroneously reflect that they quoted a rate to Moss on September 15, a week before they received any contact on her behalf. Although Moss testified that Betty told her the $262.50 was the down payment on her insurance premium, her testimony is not credible in view of the numerous documents that she signed stating that she fully understood that Respondent was not an agent for Hartford, that Respondent would be acting on her behalf pursuant to the Power of Attorney and Consultant's Agreement which she had signed, and the other documents reflecting that the $262.50 was a consultant's fee which she was paying to Respondent to act on her behalf. Her testimony that she did not understand is refuted by the documents she signed saying that she did. There is no allegation that Moss, a retired registered nurse, was unable to read. Rather, it is concluded that Moss voluntarily chose to pay the Hartford premium plus Respondent's consulting fee since the total price for the two charges was still substantially less than she could have obtained insurance for from other sources. Allstate Insurance Company is an insurer which sells insurance policies through their agents in the State of Florida. It also has a division which participates in Florida's Joint Underwriting Association (hereinafter "FJUA"), a program through which high-risk drivers who cannot obtain insurance in the regular voluntary insurance market can obtain automobile insurance. Prior to the time that his general lines agent license expired, Respondent participated in that program and was assigned to write insurance for Allstate for policyholders participating in the program. The Producers Contract entered into between Respondent and the FJUA, which assigned him to Allstate Insurance Company, provided that it would automatically terminate if an agent's general lines license expired. On July 22, 1988, James Tillie came to the office of J. M. C. to procure automobile insurance for the van that he used in his business. After meeting with Respondent, Tillie gave Respondent a check in the amount of $204 as a down payment on an automobile insurance policy. The check was endorsed and deposited into the business bank account of J. M. C. Respondent gave James Tillie an automobile insurance binder which reflected that his insurance policy was to be issued through Allstate Insurance Company. Under the terms of Respondent's contract with the FJUA, Respondent was required to submit James Tillie's application and premium to Allstate within 24 hours. The FJUA application acts as a binder. Once the application is completed and the premium is paid to the agent, the insured has automatic coverage for 30 days during which time the carrier, Allstate in this case, can act on the application. There is no evidence as to when Respondent forwarded James Tillie's application to Allstate; however, Allstate has no record of ever receiving the application. Respondent did tell James Tillie that within a couple of months he would receive from Allstate his policy and instructions for payment of the balance of his premium. After a month or two had elapsed, James Tillie became concerned since he had not yet received his insurance policy. He contacted Respondent who assured him that he did have insurance coverage. Shortly thereafter, James Tillie received in the mail from Respondent a card entitled Insurance Identification Card. On that card information had been filled in showing a policy number, the effective date, the insurance company as Allstate Insurance Company, a description of the insured vehicle, and the name and address of James Tillie. This is not an official Allstate identification card, and no one purported it to be such. An official Allstate Insurance card is issued by Allstate as part of the policy issued by it. On September 23, 1988, Sina Tillie, James' mother, visited J. M. C. for the purpose of purchasing automobile insurance for her new automobile. Sina Tillie is an elderly person who had never before owned an automobile or possessed a driver's license. She wished to purchase insurance on a brand- new automobile. Sina Tillie gave Respondent $1,828 in cash as full payment of the policy's annual premium. Respondent gave her an insurance binder which reflected that her insurance was placed with Allstate. Allstate has no record of receiving Sina Tillie's application and premium from Respondent. Subsequently, Sina Tillie became concerned when she had not yet received her insurance policy. She asked her daughter to contact Respondent. Respondent advised her daughter not to worry. He then mailed to Sina Tillie an Insurance Identification Card similar to the one which he had provided to James Tillie reflecting James' coverage. He also telephoned Sina Tillie to assure her that if anything happened, all she would need to do would be to show the card saying that she was covered and to contact him. Since neither he nor his mother had received a policy from Allstate, James Tillie called Allstate. He did not know that there were, in effect, two Allstates. The Allstate office which he contacted was a regular Allstate office which markets insurance to customers who call or come in, and not an office affiliated with the FJUA program. The person with whom he spoke told him that neither he nor his mother were insured by Allstate and that the policy numbers reflected on the Insurance Identification Cards given by Respondent to James and his mother were not Allstate policy numbers, but rather were binder numbers. James Tillie then contacted Respondent who consistently maintained that both James and Sina were insured. Respondent contacted Allstate regarding James' and Sina's policies. James Tillie came to the office of J. M. C. and met with Respondent. He advised Respondent that he and his mother had obtained insurance elsewhere and requested refunds of the premiums that he and his mother had paid. Respondent told Tillie that he could not refund the premiums since both James and his mother were insured in exchange for those premiums. Respondent eventually told James Tillie that he would refund the premiums if the Tillies would sign releases. James Tillie maintained that he would sign releases only after he had received the refund of the premiums. The meeting ended in stalemate. James Tillie contacted Petitioner, and Petitioner contacted Respondent. Respondent maintained that he would refund the premiums in exchange for a release. Petitioner forwarded a copy of Respondent's letter to James Tillie. Respondent eventually made arrangements with James and his mother to refund the premiums in monthly payments since he did not have the money to refund the premiums in full. By the time of the final hearing in this cause, Respondent had only refunded the total amount of $600 to the Tillies. At the time that Respondent's general lines agent license with Integrity Insurance Company was cancelled on March 24, 1987, he believed that he was being re-licensed by Fortune Insurance Company. However, he never received a license for or from Fortune and never checked to ascertain why.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding Respondent guilty of statutory violations as set forth in this Recommended Order and suspending Respondent's licensure and eligibility for licensure for a period of 60 days from the date of the Final Order entered in this cause. DONE and ENTERED this 13th day of June, 1990, at Tallahassee, Florida. LINDA M. RIGOT, 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 13th day of June, 1990. APPENDIX TO RECOMMENDED ORDER Petitioner's proposed findings of fact numbered 1-3, 7-9, 14-19, 21-26, and 28-32 have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed findings of fact numbered 4-6, 10, 11, 13, 20, and 27 have been rejected as not being supported by the weight of the credible evidence in this cause. Petitioner's proposed finding of fact number 12 has been rejected as being unnecessary for determination of the issues in this cause. COPIES FURNISHED: James A. Bossart, Esquire Department of Insurance and Treasurer Division of Legal Services 412 Larson Building Tallahassee, Florida 32399-0300 Johnny L. Johnson 17120 Northwest 27th Avenue Opa Locka, Florida 33056 Honorable Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32399-0300 Don Dowdell, General Counsel Department of Insurance and Treasurer The Capitol, Plaza Level Tallahassee, Florida 32399-0300 =================================================================
