Department Communication

 

The Communications Director manages the Department of Communications. The Insurance Commissioner appointed Florida’s Communications Director in March 2014. According to the Insurance Commissioner, the department’s Director (aka “Commissioner”) of Communications is responsible for: “… the day-to-day activities of the communications business unit. He will serve as the key spokesperson for the OIR, and advise on overall communication strategies.” [Source: OIR Press Release]

 

The CFO and Insurance Commissioner are proponents of transparency for its citizens. Managing communications and making them public (as appropriate) enforces the transparency process. The Newsroom on the floir.com/office/newsroom.aspx website makes the Director available, provides access to OIR actions, and ensures related news is current. Citizens are invited to follow them @FLOIR_comm on Twitter© and Facebook© and sign up for the weekly newsletter Dollars & Sense.

 

 

Guaranty Association

 

Florida Insurance Guaranty Association (FIGA) is part of a non-profit, state-based, statutorily-created system that pays certain outstanding claims of insolvent insurance companies. By paying these claims, guaranty associations protect policyholders and claimants. Guaranty associations are active in every state, the District of Columbia, Puerto Rico and the Virgin Islands. 

Guaranty associations ease the burden on policyholders and claimants of the insolvent insurer by immediately stepping in to assume responsibility for most policy claims following liquidation. The coverage guaranty associations provide is fixed by the policy or state law; they do not offer a "replacement policy."

By virtue of the authority given to the guaranty associations by state law, they are able to provide two important benefits: prompt payment of covered claims and payment of the full value of covered claims up to the limits set by the policy or state law.

Specifically, when a member insurer is found to be insolvent and is ordered liquidated, a receiver takes over the insurer under court supervision and processes the assets and liabilities through liquidation. Upon liquidation, FLAHIGA automatically becomes liable for the policy obligations the liquidated insurer owed to its Florida policyholders. [Chapter 631]

 

 

Life and Health Insurance Guaranty of Payments [§631.711]

What follows applies to direct life insurance, health insurance, annuity contracts, and supplemental contracts issued by those licensed to transact insurance in Florida. Coverage is provided to: 

 

· Those who are the beneficiaries, assignees, or payees of covered persons; and

· Those who are owners of policies or contracts, and who:

o Are residents of Florida; or

o Are residents of other states, IF:

* The insurer is in Florida;

* The insurers were not licensed in the states in which the individuals reside at the time specified in a state’s guaranty association law (necessary for coverage);

* Such other states have associations similar to the association created by Florida; and

* Such persons are not eligible for coverage by those associations.

* Notwithstanding any other provisions this part applies to coverage of a person who is a payee under a structured settlement annuity, or a beneficiary if the payee is deceased, with a coverage limit of $300,000 by the association, if:

· The payee is a resident of Florida.

· The payee, the beneficiary, or the contract owner is eligible for coverage by the association of the state in which the contract owner resides.

 

Administration and Assessment [§631.715(2)(a)]

 For purposes of administration and assessment, the association maintains three accounts:

· The health insurance account;

· The life insurance account; and

· The annuity account.

Borrowing between accounts for payment of policyholder and contract holder claims and other obligations of the association is authorized at the discretion of the board of directors, provided that the amounts are restored to the appropriate accounts not less than annually.

The association is under the immediate supervision of the department and subject to the applicable provisions of the insurance laws of Florida.

 

 

Florida HMO Consumer Assistance Plan [§631.811 and §631.828]

There is a nonprofit legal entity known as the Florida HMO Consumer Assistance Plan. All HMOs must remain members of the plan as a condition of their authority to transact business in Florida. The plan performs its functions under the plan of operations established and approved under the provisions and exercise its powers through a board of directors. The plan comes under the immediate supervision of the department and is subject to the applicable laws of Florida.

 

 

INSURANCE LAW AND UPDATES

 

New Florida Law Updates

The following are summaries of new Florida laws and their effective date:

2019 UPDATES

HB 29—Active Military Members, Veterans, and Their Spouses

House Bill 29 waives the prelicensing education requirement for active military members, veterans, and their spouses who are currently in good
standing with the military or have been honorably discharged. These individuals are also exempt from license application fees if they are currently in good standing with the military or have been honorably discharged within 24 months of application.
[Sec. 626.171, 732, 7851, 8311, 8417, 927 F.S.; effective July 1, 2018]

HB483—Advertising and Promotional Gifts

This bill modifies Florida’s unfair trade practices law regarding advertising
and promotional gifts. Insurers and agents may give insureds, prospective insureds, and others merchandise, gift cards, event tickets, or other items valued at $100 or less per individual in any calendar year. For title insurance agents and agencies, a $25 limit applies. Insurers and agents may also make charitable contributions on behalf of insureds or prospective insureds of up to $100 per individual in any calendar year.
[Sec. 626.9541 F.S.; effective July 1, 2018]

 

2020 UPDATES

HB 7065 – Assignment Of Benefits Reform

Provides for substantial changes in the way insurance benefits may be assigned to third parties. Defines “assignment agreement” and establishes requirements for the execution, validity, and effect of such an agreement; Transfers certain pre-lawsuit duties under the insurance contract to the assignee and shifts the burden to the assignee to prove that any failure to carry out such duties has not limited the insurer’s ability to perform under the contract; Requires each insurer to report specified data on claims paid in the prior year under assignment agreements by Jan. 30, 2022, and each year thereafter; allows an insurer to make available a policy prohibiting assignment, in whole or in part, under certain conditions; Revises the state’s one-way attorney fee statute to incorporate an attorney fee structure in determining the fee amount awarded in suits by an assignee against an insurer; requires service providers to give an insurer and the consumer prior written notice of at least 10 business days before filing suit on a claim.  Takes Effect: July 1, 2019

HB 1393 – Modifies Areas Regulated by the Florida Department of Financial Services

· Allows applicants that have committed certain felonies to obtain a license on a probationary basis once the applicant has served at least half of the disqualifying period if the applicant, during that time, has not been found guilty of or has not pleaded guilty or nolo contendere to a crime;
·Provides the DFS the discretion to deny, suspend, revoke, or refuse to continue an insurance agency license on the grounds that another jurisdiction has taken an adverse action against a professional license held by a majority owner, partner, manager, director, officer or other controlling person of the agency  Takes Effect: July 1, 2019

 

2021 UPDATES

SB 292: Insurance Claims Data

Insurance Claims Data; Defining the terms “loss run statement” and “provide”; requiring authorized insurers to provide insureds a loss run statement within 15 days after receipt of the insured’s written request and provide notice to the agent of record. No fees can be charged for providing this information once, annually.

This section defines a loss runs statement as a report that contains the following information about an insurance policy:
· The policy number
· The period of coverage
· The number of claims
· The paid losses on all claims
· The date of each loss

Loss run statements do not include supporting claim file documentation such as the following:
· Copies of claim files
· Investigation reports
· Evaluation statements
· Insureds’ statements
· Documents protected by a common law or statutory privilege

The loss run statement that will be given to an insured is required to contain a claims history with the insurer that covers the past five years or the complete claims history if it is less than five years. Insurers are not required to provide loss reserve information. Effective Date: 1/1/2021

SB 540: Insurance Guaranty Associations

Insurance Guaranty Associations; Authorizing certain guaranty association employees to adjust losses for the Florida Insurance Guaranty Association if certain conditions are met; redefining the term “net direct written premiums” as “direct written premiums” and revising the definition of that term; deleting a calculation of initial estimated assessments levied by the Office of Insurance Regulation on insurers in the Florida Insurance Guaranty Association; deleting a calculation of initial estimated assessments levied by the office on insurers in the Florida Workers’ Compensation Insurance Guaranty Association.

The bill establishes that assessment installment payments made by FIGA member insurers may be made quarterly rather than monthly.The bill clarifies the method by which assessments are levied against insurers and collected by FWCIGA related to policy deductibles and to retrospectively rated policies. Effective date: July 1, 2020.

HB 1189: Genetic Information for Insurance Purposes

Now, insurers who provide health, life, and long-term care insurance, in the absence of a diagnosis of a condition related to genetic information, cannot cancel, limit, or deny coverage, or establish differentials in premium rates, based on that kind of genetic information.

Additional language was added to establish that this does not prevent a life or long-term care insurer from looking at an individual’s medical record as part of the application process. The statute also does not prohibit these kinds of insurers from considering a medical diagnosis included in a medical record, even if the diagnosis was based on the results of a genetic test.
Effective Date: July 1, 2020

HB 1409: Records of Insurers

Exempts from public records requirements certain records made or received by DFS acting as receiver pursuant to specified provisions; provides that such records comprise consumer personal financial & health information, certain underwriting files, insurer personnel & payroll records, consumer claim files, certain reports & documents submitted to OIR relating to insurer own-risk, corporate governance annual disclosures, & certain information received from NAIC or governments; provides retroactive applicability; provides for future legislative review & repeal of exemptions; provides statements of public necessity.
Effective Date: July 1, 2020

 

2022 UPDATES

HB 1209 - Department of Financial Services
The bill modifies several areas regulated by the Department of Financial Services including:

- Division of Public Assistance Fraud: establishes DPAF as a criminal justice agency.
-Changes the mandatory continuing education (CE) update course for all insurance agents, customer representatives, and insurance adjusters from a five-hour course every two years to a four-hour course every two years. This language does not change the total number of CE hours that insurance agents, customer representatives, and adjusters must obtain every two years during their compliance period. This provision is effective for compliance periods that end January 1, 2022, or later, and for any agent/customer representative with such a compliance period who has already taken the five-hour course, credit will be given for the four-hour course plus one hour of elective credit.
-Protecting Proprietary Business Information: prohibits a person from requiring an insurance agent or agency to provide the replacement cost estimator or other proprietary underwriting information as a condition to extending credit secured by real property, nor may an insurance agent or agency provide this information.

Effective Date: July 1, 2021.

Senate Bill 1598 - Agency Package - PROTECTING INSURANCE POLICYHOLDERS

-Requires an entity that is licensed or issued a certificate of authority by the Department of Financial Services (DFS) or the Florida Office of Insurance Regulation (OIR) to respond to document requests from the DFS Division of Consumer Services.
-Revises the Licensing Procedures Law's prohibition against unlicensed activity to include knowingly aiding or abetting an unlicensed person in transacting insurance or otherwise engaging in insurance activities in this state without a license. A person who does so commits a thirddegree felony.
-Authorizes DFS to suspend, revoke, or refuse to issue the license of an insurance agent, adjuster, customer representative, service representative, or managing general agent that makes a consumer's personal financial or medical information available to the public, or initiates in-person or telephone solicitation with a prospective customer
after 9 p.m. or before 8 a.m., unless the customer requests otherwise.
-Prohibits the sale of industrial life insurance policies, effective July 1, 2021.
-Expands the definition of sliding, a practice that violates the Unfair Insurance Trade Practices.
-Requires insurance agencies whose name contains the word “Medicare” or Medicaid” to delete those words from the agency name no later than June 30, 2023.
Effective Date: Upon becoming law (06/16/2021, unless otherwise noted).

Senate Bill 1120 - PUSHING BACK AGAINST UNSOLICITED TELEMARKETNG

-Requires all sales telephone calls, text messages, and direct-to-voicemail transmissions to have the receiving consumer's prior express written consent if the call will be made using an automated machine to dial the recipient's phone number or will play a recorded message upon connection with the recipient.
-Amends the Florida Telemarketing Act to prohibit telephone sellers or salespersons from calling consumers outside of the hours between 8 a.m. and 8 p.m. in the consumer's time zone and prohibits telephone sellers or salespersons from contacting consumer on the same subject matter more than three times in a 24-hour period. The bill also clarifies that calls made through an automated dialer or recorded message are subject to the same prohibitions.
Effective Date: July 1, 2021

 

UPDATES 2023

HB1099 – Living Organ Donors in Insurance Policies
Prohibits insurers of life insurance policies, industrial life policies, group life policies, credit life and credit disabilities policies, and long-term care policies from discrimination against living organ donors or prospective living organ donors, in coverage or eligibility solely on their status as a living organ donor.
Effective July 1, 2022

 

UPDATES 2024

HB1185 - Consumer Protection
Living Organ Donors in Insurance Policies
Prohibits insurers of life insurance policies, industrial life policies, group life policies, credit life and credit disabilities policies, and long-term care policies from discrimination against living organ donors or prospective living organ donors, in coverage or eligibility solely on their status as a living organ donor. Effective July 1, 2022

Annuity Investments:
CS/CS/HB1185 covers regulations related to annuity investments. The bill adopts the National Association of Insurance Commissioners (NAIC) Suitability in Annuity Transactions Model Regulation (2020), which broadens the scope of requirements for sales or recommendations of annuities. The bill places a duty on insurers and agents to act in the best interest of consumers, emphasizing care, disclosure, conflict of interest, and recordkeeping. Certain exceptions are provided, and the bill introduces training requirements for agents involved in annuity sales.

Insurance Provisions:
The bill addresses unfair trade practices by requiring agents to disclose third-party remuneration for health insurance marketing practices.

CS/CS/HB 487 - Department of Financial Services

CS/CS/HB 487 is a legislative bill aimed at revising various programs and provisions within the Florida Department of Financial Services (DFS). The bill encompasses a wide range of changes that impact different aspects of financial regulation, insurance, and related areas. This summary provides an overview of the key provisions within the bill and their implications.

Investigations and Prosecutions:

The bill amends existing provisions to empower the Division of Investigative and Forensic Services (DIFS) within the DFS to conduct investigations when there is reason to believe a violation of Florida or federal criminal law has occurred. This expansion includes the authority to initiate investigations, rather than merely conduct them. Moreover, it extends the jurisdiction of the Chief Financial Officer (CFO) and State Fire Marshal to initiate investigations. Additionally, the DFS gains the authority to refer both state and federal criminal violations for prosecution.

Anti-Fraud Reward Program:

The bill introduces changes to the Anti-Fraud Reward Program by expanding the list of insurance fraud violations for which the DFS can offer rewards of up to $25,000. The expanded list includes violations related to nursing homes, forgery, racketeering, theft, false insurance claims, money laundering, and more. Importantly, the bill eliminates the requirement for a conviction to award a reward under this program, potentially encouraging more individuals to report fraudulent activities.

Florida Family and Medical Leave Act (FMLA):

The Family and Medical Leave Act (FMLA) provides eligible employees with up to 12 weeks of unpaid leave per year for family or medical reasons. While the law doesn't mandate paid sick leave, it safeguards employees' jobs during their absence.
Employment law attorneys can assist employees in understanding and asserting their FMLA rights, particularly if an employer fails to comply with the law or discriminates against them for utilizing FMLA benefits.

 

UPDATES 2025

HB201 Emergency Refills of Insulin and Insulin-related Supplies or Equipment
Authorizes emergency refill of insulin & insulin-related supplies or equipment not to exceed three non-consecutive times per calendar year.. Effective Date: July 1, 2024

HB241 Coverage for Skin Cancer Screenings
Requires DMS to require contracted state group health insurance plans to provide coverage & payment for annual skin cancer screenings performed by specified persons without imposing any cost-sharing requirement; specifies requirement for & restriction on payments for such screenings. Effective Date: July 1, 2024

HB885 Coverage for Biomarker Testing
Requires DMS to provide coverage of biomarker testing for specified purposes for state employees' state group health insurance plan policies; authorizes AHCA to pay for biomarker testing under Medicaid program for specified purposes, subject to specific appropriations; requires managed care plans under contract with agency in Medicaid program to provide coverage for biomarker testing for Medicaid recipients in certain manner; specifies circumstances under which such coverage may be provided; requires clear, convenient, & readily accessible process for authorization requests for biomarker testing. Effective Date: July 1, 2024

SB 892 Dental Insurance Claims
Prohibiting a contract between a health insurer and a dentist from containing certain restrictions on payment methods; prohibiting a health insurer from charging a fee to transmit a payment to a dentist through Automated Clearing House (ACH) transfer unless the dentist has consented to such fee; prohibiting a health insurer from denying claims for procedures included in a prior authorization; prohibiting a contract between a prepaid limited health service organization and a dentist from containing certain restrictions on payment methods, etc. Effective Date: 1/1/2025

House Bill 1093 "Florida Uniform Fiduciary Income and Principal Act"
is a Committee Substitute bill that revised the provisions of the "Florida Uniform Principal and Income Act governing trusts, estates, life estates, and other term interests."

Multiple sections of Florida Statute F.S. chapter 738 are amended by HB 1093; however, only sections will be described below that may relate or be applicable to a general category of insurance. Here are the following descriptions of the enactments to F.S. chapter 738 as a result of HB 1093.

Section 738.302 specifies the applicability of certain specified provisions and outlines exemptions regarding the apportionment of receipts and disbursements when a decedent dies or income interest begins. It authorizes the conversion of an income trust to a unitrust and restricts certain provisions to trusts that are beneficiaries of an estate.

It provides that a fiduciary acting in good faith is not liable to a person affected by a certain action or inaction.
Section 738.501 amends the wording in relation to Principal receipt to specify how a fiduciary must make disbursements from income. Among other requirements, a fiduciary must disburse from income a premium on insurance covering loss of a principal asset or income from or use of the asset.

Section 738.602 regarding Payments from deferred compensation plans, annuities, retirement plans or accounts; provides that certain beneficiaries of non-unitrusts are entitled to receive a specified share of net income. It outlines the process for determining each beneficiary's share of net income based on their fractional interest in the principal assets immediately before the distribution date. It specifies that a beneficiary's fractional interest is reduced by certain factors, including any liabilities of the estate or trust. It further provides for the method for handling disproportionate distributions, the maintenance of records for undistributed income, and other matters.

Section 738.203 speaks to a fiduciary's power to adjust between income and principal if the adjustment assists in administering the trust or estate impartially. It provides that a fiduciary is not liable to another for an adjustment, or failure to adjust, between income and principal made in good faith. It requires the fiduciary to consider certain relevant factors when considering an adjustment and prohibits a fiduciary from exercising or considering an adjustment if certain conditions exist. It authorizes the appointment of a co-fiduciary to exercise the adjustment power under specified circumstances and outlines requirements and powers for any releases and delegations. It clarifies the applicability of certain provisions and adds new accountability procedures including certain reporting requirements.

Section 738.407 regarding a fiduciary's requirement regarding allocation to principal the proceeds of a life insurance policy or other contract received by the fiduciary as beneficiary, including a contract that insures against damage to, destruction of, or loss of title to an asset. The fiduciary must allocate dividends on an insurance policy to income to the extent that premiums on the policy are paid from income and to principal to the extent premiums on the policy are paid from principal. Proceeds from contracts insuring the fiduciary against loss of occupancy or other use by a current income beneficiary, income, or profits from a business must be allocated to income.

Section 738.409 regarding deferred compensation, annuity, or similar payment; defines terms. It specifies the way a fiduciary may determine incomes of separate funds and provides that a fiduciary is not liable for good faith reliance upon any valuation supplied by the person or persons in possession of the fund. It outlines the duties of a fiduciary of a marital trust and other trusts and requires a fiduciary of a non-separate fund to calculate internal income in a specified manner.

Effective on January 1, 2025.

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Chapter 3 Contents

 

 

Department Communication
Guaranty Association
Insurance Law & Updates
Pertinent Federal Law Review Pertinent to Florida Licensed Insurance Professionals

 

 

 

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