The Issue The central issue in this case is whether the Respondent is guilty of the violations alleged in the Administrative Complaint and, if so, what penalty should be imposed.
Findings Of Fact Based upon the testimony of the witnesses and the documentary evidence received at the hearing, I make the following findings of fact: At all times material to allegations of the Administrative Complaint, Respondent, William John Harnett, has been licensed or been qualified for licensure as an insurance agent in the State of Florida. Respondent currently holds licenses for service lines insurance, debit insurance, ordinary life and health insurance, and general lines insurance (which is property, casualty, or surety). The Department is charged with the administration of Chapter 626, Florida Statutes. On December 15, 1975, the Department was appointed to serve as Receiver of Southern American Fire Insurance Company (Southern) . The purpose of this receivership was to seek the rehabilitation of the insurance company. On February 10, 1976, Southern was determined to be insolvent pursuant to Section 631.011(3), Florida Statutes and the Department, as Receiver, obtained an Order of Liquidation. The Department was charged with the responsibility of marshalling the company's assets in order to settle the outstanding claims against it. To this end, the Department filed civil suits against insurance agents and agencies which had allegedly failed to remit premium monies owed to Southern. One such suit was against Harnett, Inc., Respondent, and other individuals associated with Harnett, Inc. From April 9, 1947 until November 14, 1986, Harnett, Inc. was a corporation organized under the laws of the State of Florida whose general business was insurance. Respondent served as the treasurer and a director for Harnett, Inc. Respondent was authorized to and did sign checks and correspondence on behalf of Harnett, Inc. The Department's civil suit against Harnett, Inc. (Case No. 76-23143) was filed in Dade County on July 26, 1976. This suit claimed Harnett, Inc. had failed to remit premium monies owed to Southern and that Respondent, as an officer and director of Harnett, Inc. having direct supervision or control over individuals acting on behalf of Harnett, Inc., was personally liable for the amounts owed. On March 6, 1981, a final judgment (Case No. 76-23143) was entered in favor of the Department as Receiver of Southern. This judgment found against Respondent and Harnett, Inc., jointly and severally, in the sum of $78,617.85. This judgment was affirmed on appeal. 1/ The Department has attempted to collect the funds awarded in this judgment. From October 26, 1962 until November 14, 1986, Franklin Insurance Agency of Miami, Inc. (Franklin) was a corporation organized under the laws of the State of Florida. At all times material to this cause, Respondent was president and a director of Franklin. On October 20, 1976, the Department as Receiver of Southern filed a civil suit against Respondent and Franklin. This suit (Case No. 76-32799) claimed monies were owed to Southern for premiums Franklin had failed td remit. Further, the suit alleged that Respondent, as Franklin's president and director, was personally liable for the refusal and continued refusal of Franklin to pay the premiums. A final judgment was entered for the Department as Receiver of Southern in the Franklin suit on December 9, 1980. This judgment (case No. 76- 32799) provided for recovery against Franklin and Respondent, jointly and severally, in the sum of $35,983.39. The Department has attempted to collect the funds awarded in this judgment. Gables Insurance Agency, Inc. (Gables), organized on November 28, 1967, continues as an active corporation in this state. At all times material to the allegations in the Administrative Complaint, Respondent was the sole officer and director for Gables. Norfolk & Dedham Mutual Fire Insurance Company, Inc. (Norfolk) entered into Agency Agreements with Gables and Harnett, Inc. on February 1, 1976. Subsequently, Norfolk sued Harnett, Inc. (Case No. 84-03815) and Gables (Case No. 84-03816) for premium monies it was claimed to be owed. These suits resulted in final judgments in favor of Norfolk. The suit against Harnett, Inc. (Case No. 84-02815) found the sum of $54,556.00 was owed to Norfolk. The suit against Gables (Case No. 84-03816) found the sum of $18,843.20 was owed to Norfolk. The four judgments identified herein (paragraphs 8, 11, 14 and 15) total $188,000.44 and remain unsatisfied. These judgments represent money damages owed for unpaid insurance premiums. An applicant for licensure with outstanding judgments incurred during the course of doing the business of insurance would not be approved by the Department without a showing of restitution or rehabilitation. The Department deems such an applicant to be untrustworthy, incompetent, and not fit to become qualified and licensed in Florida. Respondent offered no evidence of restitution or rehabilitation. Respondent maintained that no monies were owed by the respective debtor companies or Respondent individually.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That Department of Insurance and Treasurer enter a Final Order revoking the licenses held by Respondent, William John Harnett. DONE and RECOMMENDED this 5th day of July, 1988, in Tallahassee, Florida. JOYOUS D. PARRISH Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 5th day of July, 1988.
The Issue This is a license discipline proceeding in which the Respondent has been charged in a one-count administrative complaint with violation of the following statutory provisions: Sections 626.561(1), 626.611(7), 626.611(9), 626.611(10), 626.611(13), 626.621(2), 626.621(6), 626.9521, and 626.9541(1)(o)1., Florida Statutes.
Findings Of Fact The Respondent, John Joseph Devins, is currently licensed in the State of Florida as a life insurance agent, as a life and health insurance agent, as a general lines insurance agent, and as a health insurance agent. The Respondent is currently, and was at all times relevant and material to this proceeding, a stockholder and officer of Devins-Varady Insurance Agency, Inc., of Stuart, Florida. Devins-Varady Insurance Agency, Inc., is an insurance agency incorporated under and existing by virtue of the laws of the State of Florida. The complaining consumer in this case, Ms. Louise Shellhammer, had carried homeowner's insurance with American Professional Insurance Company (hereinafter referred to as "American Professional") from 1986 until 1990. The agency of record for Ms. Shellhammer's American Professional homeowner's policy was the Devins-Varady Agency, Inc. Ms. Shellhammer's homeowner's insurance policy was scheduled to lapse on or about November 25, 1990. In September of 1990, the Respondent sent a letter to Ms. Shellhammer informing her that her homeowner's insurance policy was up for renewal and that the Respondent had a new carrier that he thought Ms. Shellhammer should switch to. The letter requested that Ms. Shellhammer come into the Devins-Varady Insurance Agency, Inc., and fill out a replacement application for her new insurance policy. Ms. Shellhammer failed to respond to the Respondent's letter because at the time she received the letter, she intended to change her homeowner's insurance to State Farm. Ms. Shellhammer did not follow through on her intentions in that regard and did not obtain replacement homeowner's insurance from State Farm in 1990. On or about November 15, 1990, the escrow department of Harbor Federal Savings and Loan (hereinafter referred to as "Harbor Federal"), the loss payee and holder of the mortgage on Ms.Shellhammer's home, sent a request to the Respondent for a bill for the renewal of Ms. Shellhammer's policy with American Professional. The premium for this policy was to be paid from escrowed funds held by Harbor Federal. The Respondent thereafter sent Ms. Shellhammer's renewal bill for her American Professional homeowner's policy to Harbor Federal. At the time of sending the bill to Harbor Federal, the Respondent did not attempt to bind renewal coverage with American Professional for Ms. Shellhammer. On or about November 28, 1990, the escrow department of Harbor Federal mailed a premium payment check to the Respondent in the amount of $263.00. That amount represented the renewal premium for Ms. Shellhammer's homeowner's policy with American Professional. The check was mailed three days after the lapse of the insurance policy it was intended to renew. The Respondent received that check a few days later. Upon receipt of the check, the Respondent deposited the proceeds of the check into the premium trust account of the Devins-Varady Insurance Agency, Inc. The Respondent failed to forward the renewal premium to American Professional or to any other insurer. The Respondent also failed to take any other action to obtain a renewal insurance policy for Ms. Shellhammer. These failures occurred primarily because of an oversight at the time the check from Harbor Federal was deposited for collection. At the time of depositing the check, there was an apparent failure to make a notation that follow-up action was necessary to procure an insurance policy for Ms. Shellhammer, and the follow-up action was simply overlooked. The Respondent did not become aware of the fact that he had failed to obtain insurance for Ms. Shellhammer until on or about June 12, 1991, when Ms. Shellhammer contacted him to report a burglary loss. When the Respondent pulled Ms. Shellhammer's file to process the loss claim he first discovered that she did not have insurance. Upon looking into the matter and discovering what had happened, the Respondent admitted to Ms. Shellhammer that he had made a mistake and that it was his fault that she did not have insurance. The Respondent told Ms. Shellhammer to make a list of her losses and told her that he would reimburse her for her losses. The Respondent and Ms. Shellhammer have since had some differences of opinion about the extent of Ms. Shellhammer's losses. Early in July of 1991, the Respondent repaid Harbor Federal the $263.00 that he had received from them for Ms. Shellhammer's insurance premium. The repayment was received by Harbor Federal on or about July 12, 1991. Ms. Shellhammer did not make any inquiry of the Respondent as to the status of her homeowner's insurance policy at any time between the date of the Respondent's letter in September of 1990 and the date she reported the burglary loss in June of 1991. Harbor Federal did not make any inquiry of the Respondent as to the status of Ms. Shellhammer's homeowner's insurance policy between November 28, 1990, the date it mailed a premium check, and the date of the burglary loss report in June of 1991. American Professional did not make any inquiry of the Respondent as to the status of Ms. Shellhammer's homeowner's insurance policy between November 25, 1990, the date the policy lapsed without being renewed, and the date of the burglary loss report in June of 1991. American Professional has done business with the Respondent and with the Respondent's agency for a number of years. With the exception of the incident that forms the basis for this proceeding, American Professional has never had any problems in its business relations with the Respondent or with the Respondent's agency.
Recommendation On the basis of all of the foregoing, it is RECOMMENDED that a Final Order be issued in this case dismissing all charges against the Respondent. DONE AND ENTERED this 26th day of July, 1993, at Tallahassee, Leon County, Florida. MICHAEL M. PARRISH, 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 26th day of July, 1993. COPIES FURNISHED: Joseph D. Mandt, Esquire Department of Insurance and Treasurer Division of Legal Services 612 Larson Building Tallahassee, Florida 32399-0330 Mr. John Joseph Devins, pro se 5573 Southeast Federal Highway Stuart, Florida 34997 Honorable Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32399-0300 Bill O'Neil, General Counsel Department of Insurance The Capitol, Plaza Level II Tallahassee, Florida 32399-0300
The Issue The issues in the case are whether the Respondent has failed to comply with a Final Order issued by the Petitioner or is otherwise conducting business in a manner which is hazardous or injurious to policyholders or the public, and, if so, what penalty should be imposed.
Findings Of Fact The Petitioner is the state agency responsible for licensure and regulation of insurance companies transacting business in Florida. The Petitioner was formerly identified as the Department of Insurance. The Respondent is an insurance company licensed to transact business in Florida and holding a Certificate of Authority to engage in the domestic automobile insurance business. The Respondent owns Superior American Insurance Company and Superior Guaranty Insurance Company, both of which are licensed Florida insurance companies. The Respondent is wholly owned and managed by Superior Insurance Group, Inc. (SIG). SIG is owned by Goran Capital, Inc. Douglas Symons is the President and Chief Executive Officer of Goran Capital, Inc., as well as the other aforementioned companies. SIG and its parent are not required to be licensed by, and are not regulated by, the Petitioner. The Respondent was acquired by current ownership in 1996 with the consent of the Petitioner. At the time of acquisition, the Respondent entered into a management agreement with SIG (identified at that time as GGS/Superior Insurance Group, Inc.) also with the consent of the Petitioner. According to the Consent Order dated April 30, 1996 (the date of the acquisition), the compensation for services provided to SIG by the Respondent was not to exceed 32 percent of gross written premium. The management agreement provided that the Respondent was to compensate SIG for payment of agent's commissions (not to exceed 15 percent) and for administrative services (at the rate of 17 percent of gross written premium). In July 2000, the Petitioner filed a Notice of Intent to Issue a Cease and Desist Order against the Respondent based upon the Respondent's practice of forwarding "Finance and Service Fees" to SIG in addition to the approved compensation set forth in the management agreement. "Finance and Service Fees" are fees charged by the Respondent to policyholders who choose to pay premiums by monthly installments. In January 2001, the Petitioner amended the July 2000 Notice of Intent to include allegations that the Respondent had filed misleading financial statements with the Petitioner which were intended to obscure the transfer of the fees to SIG. A formal administrative hearing on the allegations was conducted on February 7 and 8, 2001, and a Recommended Order was entered on June 1, 2001. In the Final Order filed on August 30, 2001, the Petitioner adopted the Recommended Order's determination that the financial statements filed by the Respondent had been misleading as to disclosure of the "Finance and Service Fees" transfer to SIG. In the Final Order, the Petitioner further found that the payment of "Finance and Service Fees" outside the approved management agreement "constitutes an immediate hazard to the policyholders and to the public and demonstrates a lack of fitness or trustworthiness to engage in the business of insurance" apparently because the Respondent's surplus had substantially declined during the period the fees were being forwarded to SIG. As set forth in the Final Order: Surplus as to policyholders is the source of funds used when claims payments exceed established reserves, or when expenses otherwise exceed anticipated amounts. The insurer's surplus is a statutorily mandated cushion to assure that insurers have adequate funds to perform their obligations. It must be noted, however, that it is not just the policyholders who have a stake in making sure the Respondent can pay its claims, but also all members of the public who may become involved in an automobile accident with these policyholders. By Final Order, the Petitioner directed the Respondent to "immediately cease and desist from making any such payments until such time as it had filed all required documentation seeking, and has received from the Department in writing, approval for these payments." The Final Order also required that the Respondent obtain "the immediate repayment of the net amount of approximately $15 million that was paid from 1997 through 1999, and any additional Finance and Service Fees paid thereafter." In the alternative, the Final Order provided that in lieu of immediate repayment the Respondent could request Department approval of a repayment schedule. The Final Order stated that "[i]f the Department determines in its sole discretion that the repayment schedule is in the best interests of policyholders and the public, such repayment schedule for the total amount of Finance and Service Fees that have been paid shall be implemented by the Respondent and the Respondent shall collect all such amounts from GGS/Superior in accordance therewith." Because the Respondent and SIG were owned and controlled by the same parties, the Petitioner's Final Order essentially required that the owners of the Respondent obtain the repayment of the fees from themselves. On September 28, 2001, the Respondent filed a Notice of Appeal of the Final Order with the District Court of Appeal, State of Florida, First District. The filing of the Notice of Appeal did not stay the Final Order. Despite the Final Order's prohibition on transfer of the fees, the Respondent continued to forward the "Finance and Service Fees" to SIG. On March 4, 2002, the Petitioner filed a Petition to Enforce Agency Action in the Leon County Circuit Court, Case No. 02-CA-602, seeking to enforce the prohibition on the fee forwarding arrangement. On March 14, 2002, the Respondent filed a Motion both with the Petitioner and with the First District Court seeking to stay enforcement of the Final Order. On March 20, 2002, the First District Court denied the request for the stay on the basis that the Petitioner was the appropriate entity to address the request. On April 5, 2002, the Petitioner entered an Order Conditionally Granting Stay Pending Appeal, granting a stay as to the repayment of the $15 million and requiring in lieu thereof, that the Respondent post a $15 million bond. The Petitioner's Order denied the Respondent's request to stay the Final Order's prohibition against forwarding "Finance and Service Fees" to SIG. The Respondent filed an appeal of the Order Conditionally Granting Stay Pending Appeal with the First District Court on May 6, 2002. By Order of June 19, 2002, the First District Court issued an Order vacating the obligation to post a $15 million bond. The First District Court's Order did not modify the Petitioner's denial of the Respondent's request for stay regarding the prohibited payment of "Finance and Service Fees" to SIG. The District Court of Appeal affirmed the Petitioner's Final Order by per curium opinion entered on September 26, 2002. The Respondent discontinued the practice of forwarding "Finance and Service Fees" to SIG at that time. From September 2001 through September 2002 (the period of time between issuance and affirmation of the Final Order, the Respondent forwarded to SIG a net total of $4,442,079 in "Finance and Service Fees" in direct contravention of the Final Order. The net total reflects gross fees of $8,392,079 with an offset allowed for capital contributions and retained management fees totaling $3,950,000. As of the May 2003 administrative hearing, the Respondent had not obtained repayment from SIG of the approximately $15 million that was paid from 1997 through 1999. The Respondent's sole apparent attempt to obtain repayment of the $15 million was a letter dated October 21, 2002, from Ginger Darrough (Controller and Treasurer for the Respondent) to Douglas Symons as President of SIG demanding repayment of the $15 million. Ms. Darrough is the Treasurer of SIG. As stated herein, Mr. Symons is the President/CEO of the Respondent. In response to the Darrough letter, Mr. Symons proposed a repayment plan by letter dated October 31, 2002. The repayment schedule proposed by the Respondent was to repay installments of one million dollars on January 1, 2003, on October 1, 2003, on April 1, 2004, and on October 1, 2004, followed by the "balance as agreed" on April 1, 2005. The Department determined that the proposed repayment schedule was not acceptable. The evidence fails to establish that the Department's rejection of the proposed repayment plan was inappropriate. The evidence establishes that as of the May 2003 administrative hearing, the Respondent is unable to meet the repayment schedule it proposed in the October 31 letter. The Final Order required that in addition to the $15 million, the Respondent obtain repayment of "Finance and Service Fees" forwarded by the Respondent for subsequent periods. For years 2000 through 2002, the Respondent forwarded net "Finance and Service Fees" totaling $18,467,418 to SIG. The net total reflects gross "Finance and Service Fees" forwarded to SIG totaling $26,318,081 for the three-year period (including $10,981,082 in calendar year 2000, $9,937,400 in calendar year 2001, and $5,399,536 in calendar year 2002) and credits the Respondent for $5,500,600 in paid-in capital (2001) and retained management fees of $950,000 (2001) and $1,350,000 (2002). The Respondent has not obtained repayment of the additional "Finance and Service Fees" paid between 2000 and 2002. The net "Finance and Service Fees" improperly forwarded between 1997 and 2002 by the Respondent to SIG total $33,467,418. During the time the fees have been forwarded by the Petitioner to the parent company, the Petitioner suffered a precipitous decline in surplus. The Respondent had a surplus of approximately $57 million at the end of 1998. By the end of 2002, the surplus had declined to approximately $10 million. The Respondent asserts that discussions and correspondence with the Petitioner regarding compliance with the requirements of the Final Order suggested that a resolution outside the terms of the Final Order was possible and supports the Respondent's lack of compliance. The evidence fails to support the assertion.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Financial Services, Office of Insurance Regulation enter a Final Order suspending the Respondent's Certificate of Authority to transact business in the State of Florida. DONE AND ENTERED this 6th day of August, 2003, in Tallahassee, Leon County, Florida. S WILLIAM F. QUATTLEBAUM 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 6th day of August, 2003. COPIES FURNISHED: James S. Grodin, Esquire Foley & Lardner 111 North Orange Avenue, Suite 1800 Orlando, Florida 32801-2386 Elenita Gomez, Esquire Department of Financial Services Office of Insurance Regulation 612 Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0333 S. Marc Herskovitz, Esquire Department of Financial Services Office of Insurance Regulation 612 Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0333 N. Wes Strickland, Esquire Foley & Lardner 106 East College Avenue, Suite 900 Tallahassee, Florida 32301 Honorable Tom Gallagher, Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Mark Casteel, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300
The Issue The issue for consideration is whether the Respondent's license as an insurance agent should be disciplined because of the misconduct alleged in the Administrative Complaint filed herein.
Findings Of Fact At all times pertinent to the issues herein, Respondent, Shirley Ann Cramer, was licensed as a life, health and general lines insurance agent in Florida, and was the sole owner and operator of Consolidated Insurance Associates, Inc., an incorporated general lines life and health insurance agency in Clearwater, Florida. The Department of Insurance was and is the state agency responsible for the licensing and regulation of insurance professionals in this state. In February, 1987, Mercedes Wescott went to the Respondent's agency in Clearwater where she spoke with whom she assumed to be an employee, an individual named Jack. "Jack" is Jack Jarr, Respondent's former husband and a licensed insurance professional who works in a different agency from Respondent, but who was licensed with Respondent's agency at the time in question as well. Ms. Wescott wanted a policy of life insurance, and after talking with Jack, wrote and delivered a check for $167.00, payable to Consolidated Insurance Associates, Inc., as initial down payment therefor. About a week later, she took the required insurance physical but never received the policy she had bought. She called the agency several times about the matter and was repeatedly told the policy was coming. Finally, in June, 1987, she received a letter from American Health and Life Insurance Company, the company with whom, apparently, she was to be insured, advising her that her application for insurance was being cancel led because certain required information was not received. When she called the agency, (Jack), to get her money back, he promised to send it but never did. As a result, she finally called Respondent who, in November, 1987, mailed her a check on the account of Consolidated Insurance Associates, Inc., dated November 24, 1987, in the amount of $117.00, $50.00 less than the initial payment. Ms. Wescott admittedly did not deposit that check immediately. For one thing, it was not for the correct amount, and in addition, she overlooked it. When she finally did deposit it for collection, it was dishonored and returned because of insufficient funds, and she was charged a $12.00 service charge. On January 9, 1988, Ms. Wescott wrote to Respondent outlining what had happened and requested a replacement check in the amount of $179.00, ($167.00 plus $12.00). In this letter, which was mailed to Respondent's home address since the agency had, in the interim, been sold, Ms. Wescott recited the lack of Respondent's response to prior calls and threatened to report the matter to the Insurance Commissioner. Even with this, she received no response from Respondent. Ms. Wescott determined that Respondent was working at a real estate office and when called there, too, failed to return calls. Ms. Wescott ultimately received a check for the entire amount from, she believes, the Department of Insurance. Though she is not sure from whom the check was received, she is certain it was not Respondent or Respondent's agency. When she contacted the new owner of the agency, her request for reimbursement was denied and the new owner suggested she contact the Department. Admittedly, Ms. Wescott dealt only with Mr. Jarr up until the time the cancellation letter was received. Only at that point did she talk with Respondent, and the check, purportedly in reimbursement for the premium paid, which was dishonored, was signed by Respondent. Respondent claims that she was only the subagent for the company with whom Mr. Jarr placed Ms. Wescott but paid Ms. Wescott back herself with a check she claims was good when written. However, since the check in question is dated November 24, and even though held by Ms. Wescott for a while, it had been deposited and dishonored by January 9, 1988 when Ms. Wescott's letter to Respondent was written. This accounts for a total time of 46 days from date of check to date of letter, and with mail times and bank processing times deducted, the time the check was held before deposit cannot be considered unreasonable. Ms. Cramer sold the agency in December, 1987 to an individual who was to assume all the agency liabilities. At the time she sent Ms. Wescott the check for $117.00, she was, she claims, unsure of the amount owed since she no longer had the books in her possession. Considering the probabilities of her testimony and it's corroboration or lack thereof by other evidence of record, it is considered unworthy of belief. On April 4, 1988, Thomas J. Secondo, who was, at the time, having a personal relationship with the Respondent, went to her to get insurance on his two automobiles. He wrote a check that day for $1,641.00 for what he believed was the total premium for the coverage sold and gave it to Respondent personally. He never received a policy of insurance for his money but on June 9, 1988, was notified that his coverage would be cancelled on June 18, 1988 for "underwriting reasons." Somewhat before that time, he also received a book of payment coupons, the reason for which he could not fathom, since it was his understanding he had paid for his policy in full by the check he had given Respondent. Documents introduced into evidence by the parties reflect that on May 18, 1988, Mr. Secondo's policy, purportedly with American United Insurance Company, was to be financed through Express Premium Finance, Inc. in Hollywood, Florida. Mr. Secondo denies having signed the premium finance agreement which bears what is purported to be his signature, and examination of that document clearly reveals that the signature thereon is not his. Just as all this was happening, Respondent contacted Mr. Secondo in writing on June 15, 1988 and requested he come to the office to sign a new application for the requested coverage. Enclosed with that request was a copy of an insurance binder for auto coverage with Bankers Insurance Company, to be effective on June 18, 1988. Again, Mr. Secondo was sent a premium finance notice by Bankers representing a total premium of $1,358.00. This notice, dated August 29, 1988, reflected the first premium of $14.30, due on August 12, 1989, the second in the amount of $193.34, and the remainder, also at $193.34, due on the 28th of each month thereafter. By memo of August 19, 1988, Bankers Insurance Company notified Mr. Secondo that his policy was being cancelled for nonpayment of the initial $14.30 premium. However, by notice of September 1, 1988, the company reinstated the coverage and included a new billing schedule reflecting a slightly higher monthly premium of $197.54. On August 16, 1988, Respondent wrote to Mr. Secondo informing him of a change in policies and noting that the new policy was somewhat less expensive than the former. Notwithstanding this, by letter dated September 25, 1988, she advised him of the need for him to pay an additional $171.31. Mr. Secondo did not understand the reason for this additional charge in light of the fact that the second policy, that issued, was less costly than the first which was never issued. This discrepancy was not successfully explained at hearing nor has it yet been clearly explained. Notwithstanding his confusion, on the advice of a representative from the Department's St. Petersburg office, Mr. Secondo paid the additional sum requested. Ms. Cramer claims that all she asked from Mr. Secondo at the time she sold him the insurance was the down payment on the policy. However, he insisted on giving her more money to impress her with how much money he had. She further claims she put the balance over the down payment in the account of ASAP Insurance, (not further identified). On examination, she claimed this was a unique situation and she never does business this way. Ms. Cramer has been licensed as an insurance agent in Florida for almost 20 years and claims never to have had a problem with the Department before now. There is no evidence of any prior complaints against her or of prior disciplinary action. She had known Mr. Secondo for about 3 months before he came to her for insurance on his vehicles. She admits to having received his check for $1,641.00 for the premium for that coverage. Because of some difficulty with his driver's license, which she discussed with him at the time, she processed the application, sending in only the required 30% down payment so that if the application was rejected, he would not have to wait to get back the full amount of his premium. She claims to have advised him at the time there might be a problem and that the policy, when issued, might carry a higher or lower premium. When she sent the deposit for the auto insurance to the broker with whom she was dealing, he required a premium finance agreement which she filled out and sent in without, she claims, affixing Mr. Secondo's signature thereto. She claims to have no knowledge as to who signed it, but this is unworthy of belief. The automobile insurance was not issued by the first company because of some underwriting problem. Respondent claims she told Mr. Secondo this but by then he had received a payment schedule and was upset about that. Ms. Cramer claims that Mr. Secondo had been fully advised that only a part of the $1,641.00 he had paid originally was to go to payment of premium, but she does not explain where the balance went, other than into the account of ASAP. She also claims to have procured insurance for him from Bankers Insurance Company without financing any part of the premium, but it is clear from the documents introduced that this coverage was financed as well. Her exculpatory comments are confusing and far less than convincing, and are not believed. Respondent asserts she made the premium payments for Mr. Secondo, (presumably from the sums deposited to ASAP), until she got an accounting from the company. She then wrote to Mr. Secondo, (their personal relationship having dissolved by then), and claimed the amount she felt was due her, (the $171.31). She admits that in the interim, while she was awaiting the refund from the first policy deposit, she neglected to make the initial $14.30 premium payment on the second policy, causing it to be cancelled. At that point, she made the payment to have the policy reinstated. The reinstatement notice, however, does not show the policy paid in full, but calls for continuing installments. Ms. Cramer now claims that the $1,641.00 figure she gave Mr. Secondo was tentative and subject to change and that he knew it. She claims the discrepancy involving his policy was a bookkeeping error, and at no time did she intend to take his money and not get him insurance. The evidence, however, shows otherwise.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that the Insurance Commissioner issue a Final Order in this case suspending Shirley Ann Cramer's license and eligibility for license as an insurance agent of any kind in Florida for one year. RECOMMENDED this 6th day of August, 1990, in Tallahassee, Florida. ARNOLD H. POLLOCK, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 6th day of August, 1990. COPIES FURNISHED: Robert V. Elias, Esquire Department of Insurance Division of Legal Services 412 Larson Building Tallahassee, Florida 32399-0300 John L. Waller, Esquire 100 2nd Avenue, North Suite 210 St. Petersburg, Florida 33701 Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32399-0300 Don Dowdell General Counsel Office of the Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32399-0300
