DFS: General Duties and Powers

  • DFS:  General Duties and Powers


The Department of Financial Services with power and authority granted by the Florida Insurance code, is charged with the responsibility of regulating the Insurance marketplace which entails the enforcement of the professional guidelines defined within our Insurance Code.  


The powers granted to the Department are broad to ensure their capability to address any insurance related issue which undermines marketplace standards.  In addition to the authority to enforce the Insurance Code, the Department is also granted the authority to adopt reasonable rules*15A necessary to identify and address specific methods of competition deemed unfair


Florida’s Insurance Code grants the Department (and Office of Insurance Regulation*) the authority to conduct marketplace investigations.  Initially, the cost of an investigations is at the expense of the state however, when violations are discovered the Department may pass “investigative cost” onto the offender.  


The investigative cost passed onto the person on trial are similar to the fees imposed by local circuit courts.  Courts used the court cost to help pay for the proceedings.  If the subject of an investigation were to obstruct the investigation in any way, they’ll be guilty of a misdemeanor.  


  • *The Department’s Division of Investigative and Forensic Services Investigators are in fact considered state law enforcement officers and therefore do in fact have the authority to carry firearms, arrest and detain individuals when necessary.


Marketplace investigations examine the business practices of individuals and entities conducting the business of insurance to identify whether they’re guilty of utilizing Unfair Methods of Competition, Deceptive acts or behaving in a manner unbecoming of a marketplace representative.  


Regardless if the offender(s) are licensed or live in another state, the CFO and Department with the authority granted by the insurance code may investigate and with the help of local law enforcement and circuit courts bring offenders to justice.  All individuals and entities conducting business within Florida’s insurance marketplace are within the CFO’s jurisdiction.

Like any investigation, the purpose is to identify if a violation occurred so, it can be addressed immediately.  The Department may only implement penalties in accordance with its jurisdiction.  IF, the violation is beyond the scope of the Departments authority, DFS Investigators will secure the evidence and refer the matter to the appropriate authority.  


Other general powers of the Department pertain to,


  • Quasi-legislative authority which grants the Department the ability to create or amend the Insurance Code.  This authority is intended to help the Department to efficiently enforce the Insurance Code.


  • *Collecting, proposing, publishing, and disseminating information which relate to any of its identified duties and,


  • *The freedom to employ Actuaries provided they are members of the Society of Actuaries or the Casualty Actuarial Society.


Florida Insurance Code defines Powers and Duties of the Department, Commission and Office in multiple “Chapters” with a general theme.  If it pertains to; insurance agents, insurance agencies, managing general agents, insurance adjusters, reinsurance intermediaries, viatical settlement brokers, customer representatives, service representatives, and agencies, Florida marketplace regulators have the authority to enforce professional standards and punish violations.  


  • If the violation occurs within an industry related entity, with a person performing a job which does not require a license, regulators may take administrative actions.  


Marketplace regulation repeats a general theme which we’ll continue to highlight throughout this course… 


  • Adhere to a professional code of ethics


  • Only represent authorized entities and


  • Report behavior which could potentially compromise our marketplace.


Many of the general powers and duties we discuss in this section pertains to both the Department of Financial Services and Office of Insurance Regulation.  


This dual authority is granted within each departments’ respective regulatory jurisdiction to examine and investigate the affairs of every person involved in the business of insurance in this state to determine whether such person has been or is

engaged in any unfair method of competition or in any unfair or deceptive act or practice prohibited the insurance code.  


If in fact an investigation has uncovered an agent or entity has violated the Agent Code of Ethics and/or committed a prohibited action, the Department (and Office of Insurance Regulation) have the authority to implement a Cease and Desist Order.  If an entity violates a Cease and Desist Order while it’s in effect, the Department and Office may choose to impose one or more of the following penalties,


  • A monetary penalty of up to $50,000,


  • Suspend or revoke the entities certificate of authority, license and/or eligibility to hold/possess a certificate of authority or license and,


  • Other penalties may be imposed as outline in the Florida Insurance Code.