Licensing

You will need to know certain information about the purpose of the insurance license and the licensing process, including information about the exam process, in order to get your insurance license. The reason agents must be licensed in Florida is to ensure that you have a certain knowledge base before you begin helping consumers, thus making it a consumer protection measure. Along the same line is the fact that background checks, as well as credit and character checks, will be conducted by the Department and your employer. You will need to know basic differences between several license types, including agents, public and all-lines adjusters, and agencies, which are office locations.

Aside from the licensing process and the the different license types, you will also learn that just being a licensed agent does not allow a person to sell insurance, and that the person must also have an appointment from an insurance company. Appointments last for two years, at which point your insurance company would have to renew your appointment with the Department of Financial Services. However, the agent will also need to complete continuing education requirements every two years in order to maintain a license. We will also discuss rules regarding communicating with the Department and record keeping.

Again, these few paragraphs are intended to be a brief introduction. The detailed information that follows is very important and required for you to get licensed.

Purpose

As previously stated, the purpose of the Florida licensing statutes is to help protect the general public by requiring a minimum level of insurance knowledge and competence of the licensee before conducting business in the area of insurance.

License types

Agent: The term agent may include a general lines agent, life, health, or title agent, but does not include a customer representative, limited customer representative, or service representative.

Public adjuster: This is someone other than a licensed attorney who represents the public, meaning the individual insured (also called a third-party claimant). This is someone who helps the individual insured in negotiating the settlement of claims that are covered by an insurance contract.

All-lines adjuster: This is someone who represents the insurer during the settlement of claims and whose job it is to help determine the amount of the claim payable under the contract. The all-lines adjuster may be self-employed, employed by an insurer, or an independent adjusting firm.

****Insurance agency: This is a business location where someone is engaging in any activity that by law may be performed only by a licensed insurance agent. An agency is not an insurer or an adjuster. Each location must be a licensed agency location, which makes sense when you consider the fact that the advertising and marketing of insurance products is regulated. There are a couple additional things that are worth noting regarding licensure of agency locations:

1. Each place of business must possess an insurance agency license to be allowed to conduct insurance business in its own name or under a trade name.
2. Making individual appointments with consumers at their place of business, a coffee shop, restaurant, etc., is allowed and those locations are not required to be licensed agency locations.
3. Advertising to the general public with a physical address that suggests that insurance may be purchased by anyone at that physical address does require that such location be a licensed and appointed agency location (for example an ad on the radio that mentions a physical location, or hanging a sign in one's front lawn would both be considered advertising to the public and therefore require the agency location to be licensed.)

****Unaffiliated agent: Someone who is unaffiliated is still a licensed agent, but is an agent who does not (and may not) have a current affiliation with an insurer or agency. This person is instead self-appointed. Unaffiliated agents are basically consultants - think of a personal shopper, but for insurance products - who provide advice and counseling and can recommend or compare insurance products to consumers for a fee. There are a few additional points to keep in mind here:

1. The fee must be established in writing and signed by both parties, the consumer and the unaffiliated agent.
2. The unaffiliated agent may not receive commissions from any insurance companies whose products the agent is comparing or recommending.
3. However, the unaffiliated agent may continue to receive residual commissions from sales made before becoming unaffiliated as long as those commissions are disclosed to the client when making recommendations or evaluations of policies from that entity.
4. The same appointment fee is required to become an unaffiliated agent as would be required by an insurer to appoint an agent.

Appointments

Remember that an agent legally represents the insurance company and not the consumer. This requires an appointment from the insurance company, which is the company giving formal permission to the agent to act on behalf of the insurer. The insurer handles the appointment and files it with the Department on behalf of the agent. There are a few things worth knowing here:

• Being a licensed agent is not sufficient to conduct insurance business - you must also have an appointment from an insurance company. The only exception to this is an unaffiliated agent who self-appoints.
• If you allow 48 months to elapse without an active appointment, you will lose your license altogether regardless of continuing education status, and if you wanted to get back in to the insurance industry you would have to go through the entire licensing process again and re-apply as a first-time applicant. *****

Term of appointment

Initial appointments are good for no less than 24 months and no longer than 36 months, depending on when the appointment was made in relation to your birth month, and the appointment always expires on the last day of your birth month. Again, it is the appointing entity (the insurance company) that will be handling this for you. But what does this mean? Here are two examples:

1. Carla's birthday is July 27, and she becomes appointed November 12, 2015. When does the appointment expire? 24 months from the appointment date will be November 12, 2017, and then it will continue to the last day of her birth month. So, in this case, her appointment will expire July 31, 2018.
2. Jack's birthday is January 13 and he becomes appointed January 15, 2015. When does the appointment expire? 24 months from the appointment date will be January 15, 2017, and then it will continue until the last day of his birth month. So, in this case, his appointment will expire January 31, 2017.

It's also important to keep in mind that no matter how long the initial appointment was, subsequent appointments will always be 24 months. Therefore, every subsequent appointment beyond the first one will expire on the last day of the agent's birth month.

Appointment termination

An appointing entity may terminate its appointment of any appointee at any time, with at least 60 days advance written notice. Within 30 days after terminating the appointment of an appointee, the appointing entity must file written notice with the department including the reasons and facts involved in the termination.