FL2371235-Hour Law and Ethics Update - Bail Bonds - CE5-237


Section 1
REGULATORY AWARENESS


Lesson 1.8 Other Requirements 2 pages
1
Bail bondsmen should be aware of the various statutory requirements, unfair methods of competition and unfair or deceptive acts or practices and how these statutory provisions affect or impact their conduct as a member of the insurance industry or as an employee or owner of an insurance entity.

Registration
§648.421 Notice of change of address or telephone number.—
Each licensee under this chapter shall notify in writing the department, insurer, managing general agent, and the clerk of each court in which the licensee is registered within 10 working days after a change in the licensee’s principal business address or telephone number. The licensee shall also notify the department within 10 working days after a change of the name, address, or telephone number of each agency or firm for which he or she writes bonds and any change in the licensee’s name, home address, e-mail address, or telephone number.

69B-221.060 Notice of Change of Address
Each licensee under Chapter 648, F.S., shall notify in writing the Department of Financial Services, Bail Bond Section, Larson Building, 200 East Gaines Street, Tallahassee, Florida 32399-0320, insurer, managing general agent and the clerks of each court in which they are registered, of a change of each business address, telephone number, or name of each agency or firm for which they write bonds within ten (10) working days of such change. Each licensee shall use Form DFS-H2-1564 (Rev. 8-12-04), entitled “Bail Bond Agent Notice of Change of Address,” which is hereby incorporated and adopted by reference, to comply with the notice requirements of this rule. This form may be obtained from the address listed above or from the Department’s website: www.MYFLORIDACFO.com/Division/Agents.com.

Advertising Recordkeeping
The surety and the bail bond agent are required to maintain records and to report certain required information to the Department as follows:

§626.112 License and appointment required; agents, customer representatives, adjusters, insurance agencies, service representatives, managing general agents.—
(1)(a) No person may be, act as, or advertise or hold himself or herself out to be an insurance agent, insurance adjuster, or customer representative unless he or she is currently licensed by the department and appointed by an appropriate appointing entity or person.

(7) (a)  An individual, firm, partnership, corporation, association, or other entity shall not act in its own name or under a trade name, directly or indirectly, as an insurance agency unless it complies with s. 626.172 with respect to possessing an insurance agency license for each place of business at which it engages in an activity that may be performed only by a licensed insurance agent. However, an insurance agency that is owned and operated by a single licensed agent conducting business in his or her individual name and not employing or otherwise using the services of or appointing other licensees shall be exempt from the agency licensing requirements of this subsection.

(b)  A branch place of business that is established by a licensed agency is considered a branch agency and is not required to be licensed so long as it transacts business under the same name and federal tax identification number as the licensed agency and has designated with the department a licensed agent in charge of the branch location as required by s. 626.0428 and the address and telephone number of the branch location have been submitted to the department for inclusion in the licensing record of the licensed agency within 30 days after insurance transactions begin at the branch location.

(c)  If an agency is required to be licensed but fails to file an application for licensure in accordance with this section, the department shall impose on the agency an administrative penalty of up to $10,000.

(d)  Effective October 1, 2015, the department must automatically convert the registration of an approved registered insurance agency to an insurance agency license.

(8)  No insurance agent, insurance agency, or other person licensed under the Insurance Code may pay any fee or other consideration to an unlicensed person other than an insurance agency for the referral of prospective purchasers to an insurance agent which is in any way dependent upon whether the referral results in the purchase of an insurance product.

(9)  Any person who knowingly transacts insurance or otherwise engages in insurance activities in this state without a license in violation of this section commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

§626.9531 Identification of insurers, agents, and insurance contracts.—
(1) Advertising materials and other communications developed by insurers, or other risk bearing entities authorized under this code and approved by the office to do business in this state, regarding insurance products shall clearly indicate that the communication relates to insurance products. When soliciting or selling insurance products, agents shall clearly indicate to prospective insureds that they are acting as insurance agents with regard to insurance products and identified insurers, or other risk bearing entities authorized under this code and approved by the office to do business in this state.

(2)  There shall be no liability to the insured on the part of, and no cause of action of any nature shall arise against, any licensed and appointed insurance agent for the insolvency of any risk bearing entity when such entity has been duly authorized or approved by the office to do business in this state. However, if the licensed and appointed agent was a controlling producer, as defined in s. 626.7491(2), of the risk bearing entity within 2 years preceding the insolvency, the agent is subject to penalty as provided in s. 626.7491(8).

§626.9541(1)(a)-(b) Unfair methods of competition and unfair or deceptive acts or practices defined.—
(a) Misrepresentations and false advertising of insurance policies.—Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, comparison, or property and casualty certificate of insurance altered after being issued, which:

1. Misrepresents the benefits, advantages, conditions, or terms of any insurance policy.

2. Misrepresents the dividends or share of the surplus to be received on any insurance policy.

3. Makes any false or misleading statements as to the dividends or share of surplus previously paid on any insurance policy.

4. Is misleading, or is a misrepresentation, as to the financial condition of any person or as to the legal reserve system upon which any life insurer operates.

5. Uses any name or title of any insurance policy or class of insurance policies misrepresenting the true nature thereof.

6. Is a misrepresentation for the purpose of inducing, or tending to induce, the lapse, forfeiture, exchange, conversion, or surrender of any insurance policy.

7. Is a misrepresentation for the purpose of effecting a pledge or assignment of, or effecting a loan against, any insurance policy.

8. Misrepresents any insurance policy as being shares of stock or misrepresents ownership interest in the company.

9. Uses any advertisement that would mislead or otherwise cause a reasonable person to believe mistakenly that the state or the Federal Government is responsible for the insurance sales activities of any person or stands behind any person’s credit or that any person, the state, or the Federal Government guarantees any returns on insurance products or is a source of payment of any insurance obligation of or sold by any person.

(b)  False information and advertising generally.—Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public:

1. In a newspaper, magazine, or other publication,

2. In the form of a notice, circular, pamphlet, letter, or poster,

3. Over any radio or television station, or

4. In any other way,

an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance, which is untrue, deceptive, or misleading.

2
§626.9541(1)(m)-(n) Unfair methods of competition and unfair or deceptive acts or practices defined.—
1. The provisions of paragraph (f), paragraph (g), or paragraph (h) do not prohibit a licensed insurer or its agent from:

a. Giving to insureds, prospective insureds, or others any article of merchandise, goods, wares, store gift cards, gift certificates, event tickets, anti-fraud or loss mitigation services, or other items having a total value of $100 or less per insured or prospective insured in any calendar year.

b. Making charitable contributions, as defined in s. 170(c) of the Internal Revenue Code, on behalf of insureds or prospective insureds, of up to $100 per insured or prospective insured in any calendar year.

(n)  Free insurance prohibited.—
1. Advertising, offering, or providing free insurance as an inducement to the purchase or sale of real or personal property or of services directly or indirectly connected with such real or personal property.

2. For the purposes of this paragraph, “free” insurance is:

a. Insurance for which no identifiable and additional charge is made to the purchaser of such real property, personal property, or services.

b. Insurance for which an identifiable or additional charge is made in an amount less than the cost of such insurance as to the seller or other person, other than the insurer, providing the same.

3. Subparagraphs 1. and 2. do not apply to:

a. Insurance of, loss of, or damage to the real or personal property involved in any such sale or services, under a policy covering the interests therein of the seller or vendor.

b. Blanket disability insurance as defined in s. 627.659.

c. Credit life insurance or credit disability insurance.

d. Any individual, isolated, nonrecurring unadvertised transaction not in the regular course of business.

e. Title insurance.

f. Any purchase agreement involving the purchase of a cemetery lot or lots in which, under stated conditions, any balance due is forgiven upon the death of the purchaser.

g. Life insurance, trip cancellation insurance, or lost baggage insurance offered by a travel agency as part of a travel package offered by and booked through the agency.

4. Using the word “free” or words which imply the provision of insurance without a cost to describe life or disability insurance, in connection with the advertising or offering for sale of any kind of goods, merchandise, or services.

§648.36 Bail bond agent’s records.—
Each licensee must maintain in his or her office such records of bail bonds executed or countersigned by him or her to enable the department to obtain all necessary information concerning such bail bonds for at least 3 years after the liability of the surety has been terminated. Such records shall be open to examination, inspection, and photographic reproduction by the department or an authorized representative of the insurer or managing general agent, or agents of the department, at all times, and the department may at any time require the licensee to furnish to it, in such manner or form as it requires, any information concerning the bail bond business of such licensee.

69B-221.055 Permanent Office Records Required
Each licensee, as a minimum requirement for permanent office records shall maintain:

(1) A daily bond register which shall be the book of original and permanent record of all bonds or undertakings executed by the licensee which shall state the number of the Power of Attorney form, date bond was executed, name of principal, amount of bond, premium charged, premium reported to surety company, security or collateral received, indemnity agreements, disposition of bond, and date of disposition.

(2) An individual file or envelope for each principal for whom bond is made which shall contain the original application for bail bond or undertaking, copy of premium receipt, copy of collateral receipt, copy of a bond discharge, if issued, security or collateral affidavit, where security or collateral is located, information as to any security or consideration received by the agency or licensee in connection with each particular bail bond or undertaking and purpose for which it was received, receipt or release executed by the person or persons posting security or collateral evidencing the return of such security or collateral and indemnity agreement as executed by co-indemnitors.

69B-221.150 Department May Request Information
The Department may request any licensee or insurer to furnish it with any information concerning the bail bond business of any licensee or insurer which it deems necessary.