The Issue Whether the Amended Notice and Order to Show Cause issued in DOAH Case Number 11-1150, with which this unadopted rule challenge is now consolidated, contains an agency statement that comes within the definition of a rule but has not been adopted through rulemaking procedures, in violation of section 120.54(1)(a), Florida Statutes, and if so, whether costs and attorney’s fees should be awarded.
Findings Of Fact The Financial Services Commission has responsibility over rules implementing provisions of the Florida Insurance Code conferring duties upon the Commission or its subunits. The Office of Insurance Regulation (the Office) is a subunit of the Financial Services Commission responsible for enforcing the provisions of the Florida Insurance Code with respect to licensees of the Office. Guarantee Trust Life Insurance Company (GTL) is a foreign insurer, domiciled in Illinois, which holds a certificate of authority to transact business as a life and health insurer in Florida. GTL offers insurance products nationwide, except for New York, including Medicare long-term care, supplemental, cancer, college student, accident, and sickness policies. GTL is subject to the jurisdiction of the Office under the Florida Insurance Code, including fines and disciplinary actions. It is substantially affected by the Office’s action and is entitled to a hearing to determine if the Administrative Complaint filed against it constitutes an unadopted rule. On or about May 5, 2010, GTL sent a Termination Letter to at least 216 Florida residents (Members) covered under an out-of-state group major medical policy (Policy), as well as to about 70 Florida residents who held individual policies offered by GTL.1/ The Termination Letter advised that major medical coverage would not be renewed and that GTL would no longer be offering major medical type coverage. On January 12, 2011, the Office served GTL with a Notice and Order to Show Cause alleging that GTL had violated the Florida Insurance Code by continuing to non-renew policies and failing to offer converted policies. A conversion policy is a form of replacement insurance coverage for which certificate holders in a group policy may be eligible when their coverage under a group policy is terminated. On January 28, 2011, GTL filed a Petition for Administrative Hearing with the Office. It amended that Petition on February 1, 2011, still maintaining that it was not required to offer conversion policies. On September 2, 2011, an Order was issued granting the Office’s Unopposed Motion to Amend Notice and Order to Show Cause. Counts I and II of the earlier complaint were amended. The earlier complaint had charged in these counts that “Guarantee Trust violated the Florida Insurance Code by failing to offer converted policies as required by Section 627.6675, Florida Statutes.” Amended counts I and II alleged that “Guarantee Trust violated the Florida Insurance Code by issuing the Termination Letter without offering converted policies required by the Florida Insurance Code and Section 627.6675, Florida Statutes.” On November 15, 2011, GTL filed a Petition to Challenge Unadopted Rule. The Petition was served on the Office more than 30 days before it was filed with the Division of Administrative Hearings, as stipulated at hearing. The Financial Services Commission has not adopted the statement that it was a violation of provisions of the Florida Insurance Code for GTL to “issue a termination letter without offering converted policies as required by Section 627.6675,” or any similar statement, by rulemaking procedures.
