The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Appropriations
BILL: CS/CS/SB 1598
INTRODUCER: Appropriations Committee (Recommended by Appropriations Subcommittee on
Agriculture, Environment, and General Government); Banking and Insurance
Committee; and Senator Gruters
SUBJECT: Consumer Protection
DATE: April 18, 2021 REVISED:
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Knudson/Johnson Knudson BI Fav/CS
2. Sanders/Johnson Betta AEG Recommend: Fav/CS
3. Sanders Sadberry AP Fav/CS
Please see Section IX. for Additional Information:
COMMITTEE SUBSTITUTE - Substantial Changes
I. Summary:
CS/CS/SB 1598 modifies provisions in several areas related to insurance that are regulated by
the Department of Financial Services (DFS). The bill:
 Requires insurers to include information regarding the DFS’s free financial literacy programs
in its notice that a consumer’s credit report or score is being requested.
 Requires an entity that is licensed or issued a certificate of authority by the DFS to respond to
document requests from the DFS Division of Consumer Services.
 Eliminates the $60 fee for a new or renewal adjusting firm license.
 Specifies that entities must comply with section 626.8696, Florida Statutes, with respect to
possessing an adjusting firm license, but provides that an adjusting firm’s branch place of
business does not require licensure if it meets specified requirements.
 Revises the Licensing Procedures Law’s prohibition against unlicensed activity to include
knowingly aiding or abetting an unlicensed person in transacting insurance or otherwise
engaging in insurance activities in this state without a license. A person who does so commits
a third-degree felony.
 Authorizes the DFS to suspend, revoke, or refuse to issue the license of an insurance agent,
adjuster, customer representative, service representative, or managing general agent that
makes a consumer’s personal financial or medical information available to the public, or
initiates in-person or telephone solicitation with a prospective customer after 9 p.m. or before
8 a.m., unless the customer requests otherwise.
BILL: CS/CS/SB 1598 Page 2
 Prohibits the sale of industrial life insurance policies, effective July 1, 2021.
 Increases to 10 days, the cooling-off period during which a consumer may cancel his or her
contract with a public adjuster.
 Requires that the public adjuster’s written estimate of loss must include an itemized, per-unit
estimate of the repairs. The public adjuster must provide the estimate to the claimant or
insured within 60 days after the execution of the public adjuster contract.
 Prohibits a licensed contractor or subcontractor from advertising, soliciting, offering to
handle, handling, or performing public adjuster services unless licensed and compliant as a
public adjuster.
 Prohibits persons other than a licensed public adjuster or attorney from offering to initiate or
negotiate on behalf of an insured or advertising services which require a public adjuster
license.
 Prohibits a public adjustor, public adjustor apprentice, or public adjusting firm, who solicits a
claim and does not enter into a contract with an insured or third party claimant, from
charging or receiving payment from an insured or a third-party claimant.
 Requires disclosure that surplus lines insurance is not covered by the Florida Insurance
Guaranty Association (FIGA) prior to placing coverage with a surplus lines insurer.
 Expands the definition of sliding, a practice that violates the Unfair Insurance Trade
Practices, to include:
o Initiating, effectuating, binding, or otherwise issuing an insurance policy without the
prior informed consent of the person who owns the property that will be insured.
o Submitting an invoice for premium payment to a mortgagee or escrow agent in order to
institute an insurance policy without the prior informed consent of the owner of the
property; does not apply to renewals or collateral protection insurance.
 Applies the property insurance claim investigation and communication requirements of
section 627.70131, Florida Statutes, to surplus lines insurers.
 Requires a residential property insurer begin its claim investigation within 14 days of
receiving a proof of loss statement; current law provides 10 business days.
 Requires insurers to provide to policyholders the adjuster’s name and state adjuster license
number when a claim investigation involves a physical inspection of the property and
maintain a record of each adjuster who communicates with the policyholder.
 Requires the insurer to provide notices that explain when the insurer is providing a
preliminary or partial estimate or making a claim payment that is not the full and final
payment for the claim.
 Requires insurers to provide the Homeowner Claims Bill of Rights pursuant to any personal
lines residential property insurance claim and adds notice regarding the right to receive
interest and the utility of taking video of damages and repairs.
 Encourages insureds, under the Homeowner Claims Bill of Rights, to file all claims directly
with their insurance company.
 Removes the insured’s obligation to pay a $100 deductible to the FIGA in order to receive
payment on their claim through the FIGA.
 Revises the definition of a “covered claim” for purposes of the Florida Workers’
Compensation Insurance Guaranty Association, to exclude the return of premium resulting
from a policy that was not in force on the date of the final order of liquidation.
BILL: CS/CS/SB 1598 Page 3
Further, the bill prohibits a credit reporting agency from charging any fee to reissue a personal
identifier or provide a new unique personal identifier to a consumer.
The bill has an insignificant indeterminate impact on state funds and expenditures. See V. Fiscal
Impact Statement.
Except as otherwise provided, the bill is effective upon becoming a law.
II. Present Situation:
Department of Financial Services
The Department of Financial Services (DFS) has broad duties, including licensure and regulation
of insurance agents, agencies, and adjusters; insurance consumer assistance and protection; and
holding and attempting to return unclaimed property to its rightful owner.1 The DFS has a
number of regulatory responsibilities over the Florida insurance market. The DFS regulates
insurance adjusters, which includes public adjusters, independent adjusters, and company
employee adjusters under Part VI, ch. 626, F.S. The DFS conducts insurance-related consumer
outreach through its Division of Consumer Services. The Division of Workers’ Compensation
within the DFS administers ch. 440, F.S., through enforcement of coverage requirements,2
administration of workers’ compensation health care delivery system,3 data collection,4 and
assisting injured workers, employers, insurers, and providers in fulfilling their responsibilities
under ch. 440, F.S.5 The DFS also administers insurer rehabilitation and liquidation in Florida
under part I of ch. 631, F.S.
DFS Division of Consumer Services
The Division of Consumer Services (division) provides education, information, and assistance to
consumers for all products or services regulated by the DFS or the Financial Services
Commission.6 The divisions’ duties specifically include:
 Receiving consumer questions and complaints;
 Educating the public about insurance-related topics;
 Providing mediation to resolve disputes between a consumer and insurance company; and
 Serving as a conduit for referrals for further legal action by the DFS.7
Section 624.307(10)(b), F.S., permits the division to impose an administrative penalty on a
person who holds a license or certificate of authority from the DFS if that person fails to respond
1
See, e.g., Department of Financial Services (DFS), What DFS Can Do For You,
https://www.myfloridacfo.com/division/CFO/DFS.htm (last visited March 18, 2021).
2
Section 440.107(3), F.S.
3
Section 440.13, F.S.
4
Sections 440.185 and 440.593, F.S.
5
Section 440.191, F.S.
6
DFS, Department of Financial Services Long Range Program Plan: Fiscal Years 2020-21 through 2024-25, 15 (Sept. 30,
2019), available at http://floridafiscalportal.state.fl.us/Document.aspx?ID=19566&DocType=PDF (last visited
March 18, 2021). See also, DFS, Consumer Guides,
https://www.myfloridacfo.com/Division/Consumers/understandingCoverage/Guides/Default.htm (last visited
March 18, 2021).
7
Section 624.307(10)(a), F.S.
BILL: CS/CS/SB 1598 Page 4
to the division’s request for information within 20 days. This has been limited by the Fifth
Amendment privilege against self-incrimination. A licensed individual must produce those
records8 that are required to be kept by law, but is not required to produce those not within the
purview of statutes.9 Conversely, a corporation has no privilege against self-incrimination, nor
does a custodian of corporate records, even if the contents tend to incriminate him or her.10
Discretion of the DFS to Act against Licensees
Section 626.621, F.S., grants the DFS discretion, under certain circumstances, to deny
applications for, revoke, or refuse to renew, the licenses or appointments of agents, adjusters,
customer representatives, service representatives, and managing general agents. Examples of
circumstances that can lead to such agency action include violation of the Florida Insurance
Code, violation of lawful orders or rules of the DFS, engaging in unfair and deceptive trade
practices.11
DFS Licensure of Adjusting Firms
Current law authorizes, but does not require, licensure of adjusting firms.12 The DFS does not
currently license any adjusting firms.13 An adjusting firm license must be renewed every three
years and requires a $60 application fee.14 An adjusting firm license application must include:15
 The name and address of each of the firm’s majority owners, partners, officers, and directors;
 The firm’s name and principal business address; and
 Any branch office locations and the names under which they will operate.
Each adjusting firm location must have a designated primary adjuster who acts as a supervising
manager and is accountable for misconduct that occurs at the firm location.16
Chapter 626, F.S., provides grounds for mandatory and discretionary denial, suspension, or
revocation of an adjusting firm license.17
DFS Authority Regarding Misleading Insurance Agency Names
The DFS may withhold permission to operate under an agency name if the name is too similar to
another already in use by a different agency; the name may mislead the public; or the name states
8
Pursuant to s. 624.23, F.S., any personal financial and health information held by the DFS or the Office of Insurance
Regulation relating to a consumer complaint or inquiry is confidential and exempt from public records.
9
Saviak v. Gunter, 379 So. 2d 450 (Fla. Dist. Ct. App. 3d Dist. 1980).
10
Eller Media Co. v. Serrano, 761 So. 2d 464 (Fla Dist. Ct. App. 3d Dist. 2000); State v. Wellington Precious Metals, Inc.,
487 So. 2d 326 (Fla. Dist. Ct. App. 3d Dist. 1986).
11
Chapters 624-632, 634, 635, 636, 641, 642, 648, and 651, F.S., constitute the “Florida Insurance Code.”
12
Section 626.8696, F.S.
13
Email from Meredith Stanfield, Director of Legislative and Cabinet Affairs, DFS, to Michelle Sanders, Legislative Analyst
Senate Appropriations Subcommittee on Agriculture, Environment and General Government (March 18, 2021) (on file with
the Senate Appropriations Subcommittee on Agriculture, Environment and General Government)
14
Section 624.501(20), F.S.
15
Section 626.8696, F.S.
16
Section 626.8695, F.S.
17
Section 626.8697, F.S.
BILL: CS/CS/SB 1598 Page 5
or implies that the agency is an entity other than an insurance agency, such as an insurer, state or
federal agency, or charitable organization.18
The Social Security Act prohibits any person from using the terms “Medicare” or “Medicaid” in
an advertisement or other communication in a manner which the person knows, or should know,
would convey the false impression that the communication is approved by the Centers for
Medicare & Medicaid Services.19
Industrial Life Insurance
Industrial life insurance is a form of life insurance in which the premiums are payable on a
monthly or weekly basis. These policies usually have a face amount of less than $5,000.20 Only
38 of the 398 active life insurers maintain existing industrial life insurance policies, and no new
industrial life insurance policies have been written in the last year.21
Public Adjuster Contracts and Estimates of Damages
Current law and administrative rules provide numerous restrictions and parameters on activities
of public adjusters, especially relating to solicitation of contracts and inducement to contract.22As
an additional consumer protection, Florida law grants a policyholder a short timeframe during
which he or she may cancel a contract with an adjuster without cause, penalty, or obligation.
This cooling-off period permits the policyholder to cancel the contract within three business days
of execution of the contract with an adjuster, or when the insured or claimant notifies the insurer
of the claim, whichever is later. However, the cooling-off period is extended to five business
days from the date the contract was executed, if it was entered into during a state of emergency
or during the one-year period after the date of loss.
The adjuster must disclose, in all of his or her contracts, the consumer’s right to cancel the
contract, and the methods by which the consumer may send a cancellation.
Each public adjuster must provide to the claimant or insured a written estimate of the loss to
assist in the submission of the insurance claim. The public adjuster must retain the estimate for at
least five years and make it available to the claimant, insured, an insurer, or the DFS upon
request.
18
Section 626.602(1)-(3), F.S.
19
42 U.S. Code s.1320b-10(a)(1). Upheld by United Seniors Ass’n Inc. v. SSA, 423 F. 3d 397, 399 (4th Cir. 2005).
20
Section 627.502, F.S. See also, DFS, Life Insurance Overview: Types of Policies,
https://www.myfloridacfo.com/Division/Consumers/UnderstandingCoverage/LifeInsuranceOverview.htm (last visited
March 18, 2021).
21
DFS, HB 717 Agency Analysis, (Feb. 24, 2021) (on file with the Senate Committee on Banking and Insurance).
22
Section 626.854, F.S. Laws enacted in 2008 (ch. 2008-220, Laws of Fla.), in 2009 (ch. 2009-87, Laws of Fla.), 2011
(ch. 2011-39, Laws of Fla.), and 2017 (ch. 2017-147, Laws of Fla.), provided significant changes relating to public adjusters.
Rule 69B-220.201(4) and (5), F.A.C.
BILL: CS/CS/SB 1598 Page 6
Surplus Lines Export Eligibility
Surplus lines insurance refers to a category of insurance for which the admitted market is unable
or unwilling to provide coverage.23 There are three basic categories of surplus lines risks:
 Specialty risks that have unusual underwriting characteristics or underwriting characteristics
that admitted insurers view as undesirable;
 Niche risks for which admitted carriers do not have a filed policy form or rate; and
 Capacity risks (which are risks where an insured needs higher coverage limits than those that
are available in the admitted market).
Surplus lines insurers are not “authorized” insurers as defined in the Florida Insurance Code,24
which means they do not obtain a certificate of authority from the Office of Insurance Regulation
(OIR) to transact insurance in Florida.25 Rather, surplus lines insurers are “unauthorized”
insurers,26 but may transact surplus lines insurance if they are made eligible by the OIR.
An insurance agent27 may