Central Florida Insurance School
5 Hour Law & Ethics Health C.E. Course
Table of Contents
Course Structure 11
SECTION (1) ONE 12
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
SECTION (2) TWO 32
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
✔ myfloridacfo.com/OnGuard/IdentityTheft 49
✔ https://www.consumer.ftc.gov/articles/0171-medical-identity-theft 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 (2) TWO – QUIZ 82
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
✔ 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
HEALTH INSURANCE C.E. COURSE – 5 HOUR
FLORIDA LAW AND PROFESSIONAL ETHICS
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.
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”?
*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),
- On Guard For Seniors, focused on Identity Theft Awareness.
- 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,
- 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,
- Obtaining a New Appointment(s),
- Renewing an existing Appointment(s),
- Terminating an Appointment(s),
- Recent Marketplace Violations
- Un-Authorized Entities and Verifying Before You Sell,