Central Florida Insurance School

5 Hour Law & Ethics Health C.E. Course


Table of Contents


Introduction 6

Course Structure 11


Unit (1) One:  Insurance Education Terminology 13

Unit (2) Two: Proper Identification Required 20

Verify Before You Sell 20

USA Patriot Act – 2001 21

Fair Credit Reporting Act – 1970 25

Identity Theft (IDT) 27

Medical Identity Theft 27

S1 – Quiz 30


Unit (1) One: The History of Marketplace Regulation. 32

1868, Paul – vs – Virginia 33

1944, United States – vs – Southeastern Underwriters (SEUA) 34

1945, McCarran – Ferguson Act 34

Unit (2) Two 35

Jimmy Patronis, Florida’s Chief Financial Officer (CFO). 35

Communicating with licensees and Consumer Resources: 47

On Guard for Seniors 48 49 49

CFO – vs – Un-Authorized Insurers 49

Un-Authorized Entities 50

Be-Aware: The Employee Retirement Income Security Act of 1974 (ERISA) 51

Professional Responsibility to Verify Before You Sell 51

Verifying an Insurer 52

CFO Jurisdiction: Process Agent 54

The CFO and Office of Insurance Regulation (OIR) 54

Unit (3) Three 57

The Department of Financial Services 57

DFS:  General Duties and Powers 59

DFS:  Protecting Marketplace Standards 62

Department Communication:  Appointment Renewal Notification 64

Agent Contact Information 64

DFS – Division of Investigative and Forensic Services 65

Terminology relevant to understanding legal/criminal matters; 66

The Division of Risk Management 68

The Division of State Fire Marshal & Office of the Director, 68

Insurance Agent & Agency Services 71

The Division of Customer Service 71

Filing & Responding to Complaints 72

UNIT (4) FOUR:  Financial Services Commission (FSC), Office of Insurance Regulation (OIR) & Office of Financial Regulation (OFR) 74

Financial Services Commission – (FSC) or Commission 74

Office of Insurance Regulation 75

Office of Financial Regulation – (OFR) or Office 80


SECTION (3) THREE:  Agent, Public Adjuster and Agency Licensing Procedures 86

Overview:  Established Marketplace Standards 86

Unit (1) One: 88

Consumer Protections 88

Insurance Agent Licensing – Consumer Protection 89

Insurance Agent Licensing 89

Insurance Agent Qualifications 89

Criteria/Qualifications for Florida General Lines Agent licensing 90

Establishing Trustworthiness and Competence: 90

Non-Resident Licensing 93

Proper identification Required 95

Basic Insurance License Applicant Requirements 95

The Insurance License Application Process 96

Insurance Licensing Examination Requirements 98

Agent Designations and Scope of License 99

Continued Education & Consumer Protections 100

Unit (2) Two: Insurance Agencies 101

Insurance Agency Licensing 101

Applying for an Insurance Agency License 101

S3 – Quiz 103

SECTION (4) FOUR – Marketplace Entities 104

Insurance Agencies 104

Insurance Agency Management 105

Agent in Charge 105

Managing General Agent (MGA) 106

School Official 107

Designating or Changing an Agent in Charge 108

AIC: Supervising Un-licensed agency personnel 108

Agency Employee 109

Furnishing Supplies to Unlicensed Individuals or Entities. 109

Professional Limitations of Un-Licensed Agency Employee 110

Incidental Insurance Related Contact: 111

Taking an Insurance Application: 113

Giving an Insurance Quote 115

S4 – QUIZ 116

SECTION (5) FIVE: The Appointment Process. 117

Insurance Appointments 117

Unaffiliated Insurance Agents 119

New and Renewing Appointments 120

Additional Appointments 122

Continuing an Appointment 122

Penalties; Renewing an Appointment after the identified Department Deadline 123

Termination of an Appointment 124

Effective Date of a Terminated of Appointment 126

S5 – QUIZ 128

SECTION (6) SIX: Insurer Financial Matters 130

The Florida Life and Health Insurance Guaranty Association, Est. 1979 130

Impaired Insurer 130

Insolvent Insurers 130

Liquidation Orders:  Penn Treaty & American Network Insurance Companies. 131

FLGA Board of Directors 131

Scope of Provisions 131

FLGA: General Powers and Duties 132

FLGA Member Assessments: 133

FLGA/DFS Relationship: The Department’s Role 133

Rating Services 135

S6 – Quiz 137

SECTION (7) SEVEN: Professional Advocacy Organizations 138

National Association of Insurance and Financial Advisers (NAIFA), 138

National Association of Health Underwriters (NAHU) 140

NAHU Code of Ethics 140

National Association of Insurance Commissioners (NAIC) 141

Senate Bill 166 141

S7 – Quiz 143

SECTION (8) EIGHT: Ethics 144

Suitability 144

The Liaisons Discovery and Professional Recommendation 144

Professional Ethics 145

Florida Agent Code of Ethics 146

Responsibilities of a Trusted Liaison 147

Advertising/Soliciting Disclosures 147

Liaison Liabilities 148

Underwriting 149

Fiduciary Responsibility 150

Reporting and Accounting for Funds 151

S8 – Quiz 153

SECTION (9) NINE:  Unfair Methods of Competition, Deceptive Acts/Practices & Penalties. 154

Misrepresentation 154

Use of Designations 156

Prohibited Use of Designation 156

Fraudulent Signatures 157

Defamation 157

Boycott, Coercion, and Intimidation 157

Unfair Discrimination & Illegal Dealings 158

Excessive Charges 158

Controlled Business 158

Rebating 159

Sliding 160

Fraud 161

Penalties:  Identified and Defined 161

Unintentional Violations 162

Intentional Violations 162

Other Penalties 163

S9 – Quiz 164





Introduction:  Insurance Education Providers & C.E. Courses


Hello and Thank-You!  You could have gone to any Authorized Insurance School for your continuing education needs but, you choose us….  THANK YOU!  


This Intermediate Level Five (5) Hour Law & Ethics course for 2-40 Licensed Health Insurance Agents was written by Jason L. Perez, a Department of Financial Services (DFS) School Official & Supervising Instructor for the Central Florida Insurance School and CE Credit Solutions. 


FOLLOW -> Jason L. Perez = @Onflipside on Instagram & Linkedin

This, Continuing Education (CE) Course focuses exclusively on Florida Insurance Laws, Professional Ethics & how these concepts pertain to the business of insurance.  In a nutshell, CE is a way to protect the integrity of our Insurance Marketplace and each topic we’ll discuss over the next 4.99 hours was specifically chosen by The State of Florida so, don’t take it out on me.  


The topics we discuss are simple and easy to absorb but, still EXTREMELY IMPORTANT and Easy to neglect!  Despite the fact this course focuses exclusively on rules and the consequences associated with breaking them, I want to reassure you it will not be all gloom and doom.  


YOU are an ethical agent so, at no time will any finger pointing be directed at you. 


We’re also NOT going to spend much, if any time memorizing laws or static textbook definitions.  Instead… we’ve highlighted a few recent violations and press releases which allow us to discuss the authority of state insurance regulators.  


Now just because I said they’ll be no finger pointing at you, doesn’t mean “WE” can’t talk a little smack amongst ourselves about the people who were recently caught trying to be slick.  The issues these people created for themselves, makes discussing the insurance code so much more interesting.


  • *Marketplace = Somewhere goods and services are sold and purchased.  Insurance can be sold online, over the phone and in person so, when I refer to the “marketplace”, I’m referencing anywhere a policy can be purchased.


  • We tend to think of laws as the rules we’re forced to comply with however, do you realize these guidelines are in fact only MINIMUM STANDARDS!

The Department of Financial Services (DFS or Department), under the direction of the Chief Financial Officer (CFO) directly manages Agents, Agencies and the intimate moments which occur between consumers and the licensed professionals.


To draw my 1st reoccurring distinction between the role of the DFS verses the Office of Insurance Regulation (OIR), let’s focus on my use of the word “intimate”.  In this instance, intimate refers to the private conversation between an agent and their prospect.  


  • On Flip Side…

You’d never assume your relationship with a business entity was personal or intimate, correct?  I wouldn’t either, business relationships are the opposite of intimate.  


The Office of Insurance Regulation (OIR) focuses exclusively on making sure Insurers and other types of entities keep their contractual promises to their clients.  If the company allows consumers to TRANSFER our RISK to them, they’re regulated by the OIR.  


  • The business of insurance is built upon a loss-sharing concept known for spreading out financial risk.  Do you remember the four (4) main ways of managing a financial *Risk?  
    • Risk Avoidance
    • Risk Reduction
    • Risk Retention = Self Insurance
  • Risk Transference = Insurance

We’re going to re-visit our risk conversation throughout this course so let’s transition into some Continuing Education (CE) facts.  


CE comes in two distinct categories, Mandatory & Elective.  The 1st version we’ll discuss is this MANDATORY Five Hour Law & Professional Ethics course because, it’s the only post licensing course topic you’re required to take.  When we dissect the topics in this course, we quickly realize our Law & Ethics studies are here to reinforce HOW we’re expected to interact with the public.  


  • Do you want the blunt & unedited reasons WHY Insurance Agents are required to complete 5-Hours of studies focused on Laws, Regulatory Entities & Professional Ethics every two years?  

PROFESSIONAL ACCOUNTABILITY – If you’ve passed a series of courses focused on the professional rules of engagement, ignorance could never be your defense.  Completing CE means agents are reasonably aware of what is considered improper conduct.


The second (2nd) category of Continued Education is considered an *Elective.  These elective courses are still focused on the business of insurance however, they can be on almost any topic related to professional conduct & insurance marketplace trends.  As long as the course you choose is Authorized by the DFS, it will count toward your compliance requirements.  


  • MOTIVATION – Tony Robbins type coaching seminars and programs designed to “motivate”, are NOT Eligible to receive Authorization from the Department of Financial Services (DFS) for Continuing Education (CE).  


Keeping your Insurance License in good standing is simple.  If you’ve been licensed for less than 6 years, you’re required to complete 24-Hours of CE with at least 5-Hours of studies focused on Insurance Law & Professional Ethics. 


The remaining 19 Elective hours are open for you to choose a topic that catches your attention.  Agents who’ve been licensed for more than 6-years, are only required to complete 20 total hours of CE which breaks down to be five (5) law & ethics credits and 15 electives.


  • [QUESTION] If you’ve been licensed for 9-Years, how many hours of CE would you have had to have completed in total to be considered “in compliance”?
    1. 88
    2. 92
    3. 96
    4. 112


*Compliance Periods – They cover a span of two (2) years

& end on the last day of your birth month.


In the question above, the 1st three compliance periods (or 6-Years) = 72 hours of CE.  The fourth compliance period only requires 20 hours for a total of 92-hours.  Year nine (9) of this example is irrelevant because, the licensee would have another year before their 5th compliance period would be due.

  • The correct answer is 92


Before we dive deep into this course, let’s take the next few moments to identify the type of topics we’ll be covering.  


  • What activities constitue the Business of Insurance?


  •  Who has the authority to deliver an insurance related message to the marketplace?


  • We discuss the General Powers and Responsibilities of Florida’s Regulatory Entities specifically,
  • Florida’s Chief Financial Officer, Jimmy Patronis (CFO),
    • CFO is a member of the Governors Cabinet and The Financial Services Commission.  
    • Head of the DFS  


  • The Department of Financial Services (DFS or Department),


  • Office of Insurance Regulation (OIR or Office),


  • Office of Financial Regulation (OFR),


  • Marketplace Resources,


  • On Guard For Seniors, focused on Identity Theft Awareness.


  • Fraud Free Florida


  • Professional Ethics, Fiduciary Responsibilities, and the roles of non-regulatory advocacy organizations such as,


  • National Association of Insurance and Financial Advisers (NAIFA),


  • National Association of Insurance Commissioners,


  • National Association of Health Underwriters,


  • Marketing, Advertising, and Licensee’s Responsibilities pertaining to,


  • Licensing,


  • Insurance Education Providers and Continued Education, 


  • Agent Contact Information,


  • Insurance Agency Licensing,


  • The Duties of Licensed – vs – Un-Licensed Personnel,


  • Transferring, Surrendering or Terminating an Insurance License,


  • The Appointment Process,


  • Obtaining a New Appointment(s), 


  • Renewing an existing Appointment(s), 


  • Terminating an Appointment(s), 


  • Recent Marketplace Violations 


  • Administrative fines


  • Criminal Consequences 


  • Identity Theft, 


  • Medical Identity Theft


  • Un-Authorized Entities and Verifying Before You Sell,