PCS for CS/HB 1111 — Non-coverage-related regulation of insurance (State of Florida, 2023)
Summary
PCS for CS/HB 1111, marked ORIGINAL 2023, a bill to be entitled an act relating to non-coverage-related regulation of insurance. Section 1 amends section 626.7851, Florida Statutes, on the coursework qualification for a license as a life agent. Section 2 amends section 626.9541, Florida Statutes, so that the definition of discrimination or unlawful rebates does not include value-added products or services offered by a life or health insurer or agent at no or reduced cost, if related to the coverage and primarily designed to serve listed purposes such as loss mitigation or enhancing health. It provides a pilot or testing program for up to 1 year, with the office or department able to object within 21 days after receiving notice. Section 3 sets an effective date of July 1, 2023.
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“PCS for CS/HB 1111 — Non-coverage-related regulation of insurance (State of Florida, 2023).”
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
PCS for CS/HB 1111 ORIGINAL 2023
1 A bill to be entitled
2 An act relating to non-coverage-related regulation of
3 insurance; amending s. 626.7851, F.S.; revising a
4 minimum coursework qualification for licensure as a
5 life agent; amending s. 626.9541, F.S.; providing that
6 certain restrictions against unfair discrimination or
7 unlawful rebates do not include value-added products
8 or services offered or provided by life or health
9 insurers or their agents if certain conditions are
10 met; providing requirements for and restrictions on
11 life or health insurers or life or health agents
12 offering or providing such products or services;
13 authorizing life or health insurers or life or health
14 agents to provide such products or services as part of
15 a pilot or testing program under certain
16 circumstances; authorizing the Financial Services
17 Commission to adopt rules; providing an effective
18 date.
19
20 Be It Enacted by the Legislature of the State of Florida:
21 Section 1. Section 626.7851, Florida Statutes, is amended
22 to read:
23 626.7851 Requirement as to knowledge, experience, or
24 instruction.—An applicant for a license as a life agent, except
25 for a chartered life underwriter (CLU), shall not be qualified
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PCS for CS/HB 1111
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PCS for CS/HB 1111 ORIGINAL 2023
26 or licensed unless within the 4 years immediately preceding the
27 date the application for a license is filed with the department
28 he or she has:
29 (1) Successfully completed 30 40 hours of coursework in
30 life insurance, annuities, and variable contracts approved by
31 the department, 3 hours of which shall be on the subject matter
32 of ethics. Courses must include instruction on the subject
33 matter of unauthorized entities engaging in the business of
34 insurance;
35 (2) Successfully completed a minimum of 60 hours of
36 coursework in multiple areas of insurance, which included life
37 insurance, annuities, and variable contracts, approved by the
38 department, 3 hours of which shall be on the subject matter of
39 ethics. Courses must include instruction on the subject matter
40 of unauthorized entities engaging in the business o f insurance;
41 (3) Earned or maintained an active designation as
42 Chartered Financial Consultant (ChFC) from the American College
43 of Financial Services; or Fellow, Life Management Institute
44 (FLMI) from the Life Management Institute;
45 (4) Held an active license in life insurance in another
46 state. This provision may not be used unless the other state
47 grants reciprocal treatment to licensees formerly licensed in
48 the state; or
49 (5) Been employed by the department or office for at least
50 1 year, full time in life insurance regulatory matters and who
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PCS for CS/HB 1111 ORIGINAL 2023
51 was not terminated for cause, and application for examination is
52 made within 4 years after the date of termination of his or her
53 employment with the department or office.
54
55 Prelicensure coursework is not required for an applicant who is
56 a member or veteran of the United States Armed Forces or the
57 spouse of such a member or veteran. A qualified individual must
58 provide a copy of a military identification card, military
59 dependent identification card, military service recor d, military
60 personnel file, veteran record, discharge paper, or separation
61 document that indicates such member is currently in good
62 standing or such veteran is honorably discharged.
63 Section 2. Paragraph (h) of subsection (1) of section
64 626.9541, Florida Statutes, is amended to read:
65 626.9541 Unfair methods of competition and unfair or
66 deceptive acts or practices defined.—
67 (1) UNFAIR METHODS OF COMPETITION AND UNFAIR OR DECEPTIVE
68 ACTS.—The following are defined as unfair methods of competition
69 and unfair or deceptive acts or practices:
70 (h) Unlawful rebates.—
71 1. Except as otherwise expressly provided by law, or in an
72 applicable filing with the office, knowingly:
73 a. Permitting, or offering to make, or making, any
74 contract or agreement as to such contract other than as plainly
75 expressed in the insurance contract issued thereon;
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76 b. Paying, allowing, or giving, or offering to pay, allow,
77 or give, directly or indirectly, as inducement to such insurance
78 contract, any unlawful rebate of premiums payable on the
79 contract, any special favor or advantage in the dividends or
80 other benefits thereon, or any valuable consideration or
81 inducement whatever not specified in the contract;
82 c. Giving, selling, or purchasing, or offering to give,
83 sell, or purchase, as inducement to such insurance contract or
84 in connection therewith, any stocks, bonds, or other securities
85 of any insurance company or other corporation, association, or
86 partnership, or any dividends or profits accrued thereon, or
87 anything of value whatsoever not specified in the insurance
88 contract.
89 2. Nothing in paragraph (g) or subparagraph 1. of this
90 paragraph shall be construed as including within the definition
91 of discrimination or unlawful rebates:
92 a. In the case of any contract of life insurance or life
93 annuity, paying bonuses to all policyholders or otherwise
94 abating their premiums in whole or in part out of surplus
95 accumulated from nonparticipating insurance; provided that any
96 such bonuses or abatement of premiums is fair and equitable to
97 all policyholders and for the best interests of the company and
98 its policyholders.
99 b. In the case of life insurance policies issued on the
100 industrial debit plan, making allowance to policyholders who
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101 have continuously for a specified period made premium paym ents
102 directly to an office of the insurer in an amount which fairly
103 represents the saving in collection expenses.
104 c. Readjustment of the rate of premium for a group
105 insurance policy based on the loss or expense thereunder, at the
106 end of the first or any subsequent policy year of insurance
107 thereunder, which may be made retroactive only for such policy
108 year.
109 d. Issuance of life insurance policies or annuity
110 contracts at rates less than the usual rates of premiums for
111 such policies or contracts, as group insurance or employee
112 insurance as defined in this code.
113 e. Issuing life or disability insurance policies on a
114 salary savings, bank draft, preauthorized check, payroll
115 deduction, or other similar plan at a reduced rate reasonably
116 related to the savings made by the use of such plan.
117 3.a. No title insurer, or any member, employee, attorney,
118 agent, or agency thereof, shall pay, allow, or give, or offer to
119 pay, allow, or give, directly or indirectly, as inducement to
120 title insurance, or after such insurance has been effected, any
121 rebate or abatement of the premium or any other charge or fee,
122 or provide any special favor or advantage, or any monetary
123 consideration or inducement whatever.
124 b. Nothing in this subparagraph shall be construed as
125 prohibiting the payment of fees to attorneys at law duly
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126 licensed to practice law in the courts of this state, for
127 professional services, or as prohibiting the payment of earned
128 portions of the premium to duly appointed agents or agencies who
129 actually perform services for the title insurer. Nothing in this
130 subparagraph shall be construed as prohibiting a rebate or
131 abatement of an attorney fee charged for professional services,
132 or that portion of the premium that is not required to be
133 retained by the insurer pursuant to s. 627.782(1), or any other
134 agent charge or fee to the person responsible for paying the
135 premium, charge, or fee.
136 c. No insured named in a policy, or any other person
137 directly or indirectly connected with the transaction involving
138 the issuance of such policy, including, but not limited to, any
139 mortgage broker, real estate broker, builder, or attorney, any
140 employee, agent, agency, or representative thereof, or any other
141 person whatsoever, shall knowingly receive or accept, directly
142 or indirectly, any rebate or abatement of any portion of the
143 title insurance premium or of any other charge or fee or any
144 monetary consideration or inducement whatsoever, except as set
145 forth in sub-subparagraph b.; provided, in no event shall any
146 portion of the attorney fee, any portion of the premium that is
147 not required to be retained by the insurer pursuant to s.
148 627.782(1), any agent charge or fee, or any other monetary
149 consideration or inducement be paid directly or indirectly for
150 the referral of title insurance business.
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151 4.a. Paragraph (g) or subparagraph 1. may not be construed
152 as including within the definition of discrimination or unlawful
153 rebates the offer or provision by a life or health insurer or a
154 life or health agent of the life or health insurer, including by
155 or through employees, affiliates, or third-party
156 representatives, of value-added products or services at no or
157 reduced cost when such products or services are not specified in
158 the insurance policy, if the product or service relates to the
159 insurance coverage and is primarily designed to do one or more
160 of the following:
161 (I) Provide loss mitigation or loss control;
162 (II) Reduce claim costs or claim settlement costs;
163 (III) Provide education about liability risks or risk of
164 loss to persons or property;
165 (IV) Monitor or assess risk, identify sources of risk, or
166 develop strategies for eliminating or reducing risk;
167 (V) Enhance health;
168 (VI) Enhance financial wellness through items such as
169 education or financial planning services;
170 (VII) Provide post-loss services;
171 (VIII) Incentivize behavioral changes to improve the
172 health or reduce the risk of death or disability of a
173 policyholder, potential policyholder, certificateholder,
174 potential certificateholder, insured, potential insured, or
175 applicant; or
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176 (IX) Assist in the administration of employee or retiree
177 benefit insurance coverage.
178 b. The cost to the life or health insurer or life or
179 health agent offering the product or service to a customer must
180 be reasonable in comparison to the customer's premiums or
181 insurance coverage for the policy class.
182 c. If the life or health insurer or life or health agent
183 is providing the product or service, the life or health insurer
184 or life or health agent must ensure that the customer is
185 provided with contact information to assist the customer with
186 questions regarding the product or service.
187 d. The availability of the product or service must be
188 based on documented objective evidence, and the product or
189 service must be offered in a manner that is not unfairly
190 discriminatory. The documented evidence must be maintained by
191 the life or health insurer or life or health agent and produced
192 upon request by the office or the department.
193 e. If a life or health insurer or life or health agent has
194 a good faith belief, but does not have sufficient evidence to
195 demonstrate, that the product or service meets any of the
196 criteria in sub-sub-subparagraphs a.(I)-(IX), the life or health
197 insurer or life or health agent may provide the product or
198 service in a manner that is not unfairly discriminatory as part
199 of a pilot or testing program for up to 1 year. A life or
200 health insurer or life or health agent must notify the office or
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201 department, as applicable, of such pilot or testing program
202 offered to consumers in this state before commencing the
203 program. The life or health insurer or life or health agent may
204 commence the program unless the office or department, as
205 applicable, objects to the program within 21 days after
206 receiving the notice.
207 f. A life or health insurer, life or health agent, or
208 representative thereof may not offer or provide insurance as an
209 inducement to the purchase of another policy or otherwise use
210 the words "free," "no cost," or similar words in an
211 advertisement.
212 g. The commission may adopt rules to administer this
213 subparagraph to ensure consumer protection. Such rules,
214 consistent with applicable law, may address, among other issues,
215 consumer data protections and privacy, consumer disclosure, and
216 unfair discrimination.
217 Section 3. This act shall take effect July 1, 2023.
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