Florida Senate - 2022 CS for SB 1292 By the Committee on Banking and Insurance; and Senator Gruters 597-02088-22 20221292c1 1 A bill to be entitled 2 An act relating to fraud prevention; creating s. 3 324.252, F.S.; requiring that the electronic 4 credentialing system display certain vehicle 5 information for specified purposes by a specified 6 date; requiring the Department of Highway Safety and 7 Motor Vehicles to provide the Legislature with 8 recommendations for compliance verification with 9 certain financial responsibility requirements by a 10 specified date; amending s. 501.165, F.S.; requiring 11 sellers to allow consumers to cancel in a specified 12 manner and by specified means service contracts that 13 have automatic renewal provisions; amending s. 14 626.854, F.S.; revising maximum fines for public 15 adjusters and public adjuster apprentices for certain 16 violations under a specified circumstance; revising 17 maximum fines for certain violations by certain 18 persons under a specified circumstance; amending s. 19 626.989, F.S.; authorizing the Department of Financial 20 Services to impose an administrative fine on insurers 21 under certain circumstances; authorizing the Division 22 of Investigative and Forensic Services to adopt 23 certain rules; amending s. 633.126, F.S.; authorizing 24 the department to impose an administrative fine on 25 insurance companies under certain circumstances; 26 deleting criminal penalties; authorizing the division 27 to adopt certain rules; amending s. 634.095, F.S.; 28 revising requirements for advertisements issued or 29 caused to be issued by service agreement companies or 30 salespersons; amending s. 775.15, F.S.; revising 31 felony violations for which prosecutions must be 32 commenced within a specified timeframe; amending s. 33 817.234, F.S.; providing that certain insurers are 34 entitled to recover specified expenses at the trial 35 and appellate courts under certain circumstances; 36 providing effective dates. 37 38 Be It Enacted by the Legislature of the State of Florida: 39 40 Section 1.Section 324.252, Florida Statutes, is created to 41 read: 42 324.252Electronic insurance verification. 43 (1)In order to empower drivers in this state and reduce 44 the incidence of automobile insurance fraud within this state, 45 by July 1, 2023, the electronic credentialing system, as defined 46 in s. 322.032(1), must display driver vehicle registration and 47 insurance information, provide a driver with notification of any 48 lapse in his or her insurance coverage needed for compliance 49 with the financial responsibility requirements of this chapter, 50 and allow the driver to update his or her policy information via 51 the system. 52 (2)By October 1, 2023, the department shall provide the 53 Legislature with recommendations on the means by which the 54 department, law enforcement agencies, and other entities 55 authorized by the department may electronically verify a 56 drivers compliance with the financial responsibility 57 requirements of this chapter. 58 Section 2.Subsection (2) of section 501.165, Florida 59 Statutes, is amended to read: 60 501.165Automatic renewal of service contracts. 61 (2)SERVICE CONTRACTS WITH AUTOMATIC RENEWAL PROVISIONS. 62 (a)A Any seller that sells, leases, or offers to sell or 63 lease any service to a consumer pursuant to a service contract 64 that has an automatic renewal provision, unless the consumer 65 cancels that contract, shall disclose the automatic renewal 66 provision clearly and conspicuously in the contract or contract 67 offer. 68 (b)A Any seller that sells or offers to sell any service 69 to a consumer pursuant to a service contract the term of which 70 is a specified period of 12 months or more and that 71 automatically renews for a specified period of more than 1 72 month, unless the consumer cancels the contract, shall provide 73 the consumer with written or electronic notification of the 74 automatic renewal provision. Notification shall be provided to 75 the consumer no less than 30 days or no more than 60 days before 76 the cancellation deadline pursuant to the automatic renewal 77 provision. Such notification shall disclose clearly and 78 conspicuously: 79 1.That unless the consumer cancels the contract the 80 contract will automatically renew. 81 2.Methods by which the consumer may obtain details of the 82 automatic renewal provision and cancellation procedure, whether 83 by contacting the seller at a specified telephone number or 84 address, by referring to the contract, or by any other method. 85 (c)A seller that fails to comply with the requirements of 86 this subsection violates is in violation of this subsection 87 unless the seller demonstrates that: 88 1.As part of the sellers routine business practice, the 89 seller has established and implemented written procedures to 90 comply with this section and enforces compliance with the 91 procedures; 92 2.Any failure to comply with this subsection is the result 93 of error; and 94 3.As part of the sellers routine business practice, where 95 an error has caused the failure to comply with this subsection, 96 the unearned portion of the contract subject to the automatic 97 renewal provision is refunded as of the date on which the seller 98 is notified of the error. 99 (d)A seller shall allow a consumer to cancel a service 100 contract that has an automatic renewal provision in the same 101 manner, and by the same means, as the service contract was 102 entered into. 103 (e)This subsection does not apply to: 104 1.A financial institution as defined in s. 655.005 or any 105 depository institution as defined in 12 U.S.C. s. 1813(c)(2). 106 2.A foreign bank maintaining a branch or agency licensed 107 under the laws of any state of the United States. 108 3.Any subsidiary or affiliate of an entity described in 109 subparagraph 1. or subparagraph 2. 110 4.A health studio as defined in s. 501.0125. 111 5.Any entity licensed under chapter 624, chapter 627, 112 chapter 634, chapter 636, or chapter 641. 113 6.Any electric utility as defined in s. 366.02. 114 7.Any private company as defined in s. 180.05 providing 115 services described in chapter 180 which is competing against a 116 governmental entity or has a governmental entity providing 117 billing services on its behalf. 118 (f)(e)A violation of this subsection renders the automatic 119 renewal provision void and unenforceable. 120 Section 3.Paragraphs (b) and (c) of subsection (22) of 121 section 626.854, Florida Statutes, are amended, and paragraph 122 (a) of that subsection is republished, to read: 123 626.854Public adjuster defined; prohibitions.The 124 Legislature finds that it is necessary for the protection of the 125 public to regulate public insurance adjusters and to prevent the 126 unauthorized practice of law. 127 (22)(a)Any following act by a public adjuster, a public 128 adjuster apprentice, or a person acting on behalf of a public 129 adjuster or public adjuster apprentice is prohibited and shall 130 result in discipline as applicable under this part: 131 1.Offering to a residential property owner a rebate, gift, 132 gift card, cash, coupon, waiver of any insurance deductible, or 133 any other thing of value in exchange for: 134 a.Allowing a contractor, a public adjuster, a public 135 adjuster apprentice, or a person acting on behalf of a public 136 adjuster or public adjuster apprentice to conduct an inspection 137 of the residential property owners roof; or 138 b.Making an insurance claim for damage to the residential 139 property owners roof. 140 2.Offering, delivering, receiving, or accepting any 141 compensation, inducement, or reward for the referral of any 142 services for which property insurance proceeds would be used for 143 roofing repairs or replacement. 144 (b)Notwithstanding the fine set forth in s. 626.8698, a 145 public adjuster or public adjuster apprentice may be subject to 146 a fine not to exceed $10,000 per act for a violation of this 147 subsection and a fine not to exceed $20,000 per act for a 148 violation of this subsection that occurs during a state of 149 emergency declared by executive order or proclamation of the 150 Governor pursuant to s. 252.36. 151 (c)A person who engages in an act prohibited by this 152 subsection and who is not a public adjuster or a public adjuster 153 apprentice, or is not otherwise exempt from licensure, is guilty 154 of the unlicensed practice of public adjusting and may be: 155 1.Subject to all applicable penalties set forth in this 156 part. 157 2.Notwithstanding subparagraph 1., subject to a fine not 158 to exceed $10,000 per act for a violation of this subsection and 159 a fine not to exceed $20,000 per act for a violation of this 160 subsection that occurs during a state of emergency declared by 161 executive order or proclamation of the Governor pursuant to s. 162 252.36. 163 Section 4.Present subsections (7), (8), and (9) of section 164 626.989, Florida Statutes, are redesignated as subsections (9), 165 (10), and (11), respectively, new subsections (7) and (8) and 166 subsection (12) are added to that section, and subsection (6) of 167 that section is amended, to read: 168 626.989Investigation by department or Division of 169 Investigative and Forensic Services; compliance; immunity; 170 confidential information; reports to division; division 171 investigators power of arrest. 172 (6)Any person, other than an insurer, agent, or other 173 person licensed under the code, or an employee thereof, having 174 knowledge or who believes that a fraudulent insurance act or any 175 other act or practice which, upon conviction, constitutes a 176 felony or a misdemeanor under the code, or under s. 817.234, is 177 being or has been committed may send to the Division of 178 Investigative and Forensic Services a report or information 179 pertinent to such knowledge or belief and such additional 180 information relative thereto as the department may request. Any 181 professional practitioner licensed or regulated by the 182 Department of Business and Professional Regulation, except as 183 otherwise provided by law, any medical review committee as 184 defined in s. 766.101, any private medical review committee, and 185 any insurer, agent, or other person licensed under the code, or 186 an employee thereof, having knowledge or who believes that a 187 fraudulent insurance act or any other act or practice which, 188 upon conviction, constitutes a felony or a misdemeanor under the 189 code, or under s. 817.234, is being or has been committed shall 190 send to the Division of Investigative and Forensic Services a 191 report or information pertinent to such knowledge or belief and 192 such additional information relative thereto as the department 193 may require. 194 (7)If an insurer fails or otherwise refuses to comply with 195 this section, the department may impose an administrative fine 196 of not more than $2,000 per day for such failure until the 197 department deems the insurer to be in compliance. 198 (8)The Division of Investigative and Forensic Services 199 shall review such information or reports and select such 200 information or reports as, in its judgment, may require further 201 investigation. It shall then cause an independent examination of 202 the facts surrounding such information or report to be made to 203 determine the extent, if any, to which a fraudulent insurance 204 act or any other act or practice which, upon conviction, 205 constitutes a felony or a misdemeanor under the code, or under 206 s. 817.234, is being committed. The Division of Investigative 207 and Forensic Services shall report any alleged violations of law 208 which its investigations disclose to the appropriate licensing 209 agency and state attorney or other prosecuting agency having 210 jurisdiction with respect to any such violation, as provided in 211 s. 624.310. If prosecution by the state attorney or other 212 prosecuting agency having jurisdiction with respect to such 213 violation is not begun within 60 days of the divisions report, 214 the state attorney or other prosecuting agency having 215 jurisdiction with respect to such violation shall inform the 216 division of the reasons for the lack of prosecution. 217 (12)The Division of Investigative and Forensic Services 218 may adopt reasonable rules as are necessary to administer this 219 section. Such rules must meet all of the following requirements: 220 (a)They may not enlarge upon or extend the provisions of 221 this section. 222 (b)They must identify specific factors that determine the 223 grades of penalty. 224 (c)They must specify mitigating and aggravating factors 225 for a violation of this section. 226 Section 5.Subsection (9) of section 633.126, Florida 227 Statutes, is amended, subsection (10) is added to that section, 228 and subsection (2) of that section is republished, to read: 229 633.126Investigation of fraudulent insurance claims and 230 crimes; immunity of insurance companies supplying information. 231 (2)If an insurance company has reason to suspect that a 232 fire or explosion loss to its insureds real or personal 233 property was caused by intentional means, the company shall 234 notify the State Fire Marshal and shall furnish her or him with 235 all material acquired by the company during its investigation. 236 The State Fire Marshal may adopt rules to implement this 237 subsection. 238 (9)If an insurance company fails or otherwise refuses to 239 comply with this section, the department may impose an 240 administrative fine of not more than $2,000 per day for such 241 failure until the department deems the insurance company to be 242 in compliance A person who willfully violates this section 243 commits a misdemeanor of the first degree, punishable as 244 provided in s. 775.082 or s. 775.083. 245 (10)The Division of Investigative and Forensic Services 246 may adopt reasonable rules as are necessary to administer this 247 section. Such rules must meet all of the following requirements: 248 (a)They may not enlarge upon or extend the provisions of 249 this section. 250 (b)They must identify specific factors that determine the 251 grades of penalty. 252 (c)They must specify mitigating and aggravating factors 253 for a violation of this section. 254 Section 6.Effective January 1, 2023, present paragraphs 255 (b), (c), and (d) of subsection (3) of section 634.095, Florida 256 Statutes, are redesignated as paragraphs (d), (e), and (f), 257 respectively, new paragraphs (b) and (c) are added to that 258 subsection, and paragraph (a) of that subsection is amended, to 259 read: 260 634.095Prohibited acts.Any service agreement company or 261 salesperson that engages in one or more of the following acts 262 is, in addition to any applicable denial, suspension, 263 revocation, or refusal to renew or continue any appointment or 264 license, guilty of a misdemeanor of the second degree, 265 punishable as provided in s. 775.082 or s. 775.083: 266 (3)Issuing or causing to be issued any advertisement that 267 which: 268 (a)Does not fully disclose in a written advertisement, in 269 at least 12-point, boldface boldfaced type, the name, address, 270 and Florida Company Code license number of the service agreement 271 company. 272 (b)Does not fully disclose in a radio or television 273 advertisement the full legal name of the licensed salesperson or 274 the service agreement company. 275 (c)Does not fully identify the soliciting licensed 276 salespersons full legal name and license number when the 277 salesperson begins, and the soliciting salespersons telephone 278 number when the salesperson concludes, each outbound telephone 279 solicitation. For the purposes of this paragraph, the actual 280 telephone number of the salesperson may be the number on file 281 with the department or the number at which the salesperson may 282 be contacted. 283 Section 7.Subsection (11) of section 775.15, Florida 284 Statutes, is amended to read: 285 775.15Time limitations; general time limitations; 286 exceptions. 287 (11)A prosecution for a felony violation of s. 440.105 or 288 s. 817.234 ss. 440.105 and 817.234 must be commenced within 5 289 years after the violation is committed. 290 Section 8.Subsection (5) of section 817.234, Florida 291 Statutes, is amended to read: 292 817.234False and fraudulent insurance claims. 293 (5)(a)Any insurer damaged as a result of a violation of 294 any provision of this section when there has been a criminal 295 adjudication of guilt shall have a cause of action to recover 296 compensatory damages, plus all reasonable investigation and 297 litigation expenses, including attorney attorneys fees, at the 298 trial and appellate courts. 299 (b)If an insurer damaged as a result of a violation of any 300 provision of this section has reported the possible fraudulent 301 insurance act to the Division of Investigative and Forensic 302 Services pursuant to s. 626.9891 and if there has been a 303 criminal adjudication of guilt, the insurer is entitled to 304 recover reasonable investigation and litigation expenses, 305 including attorney fees, at the trial and appellate courts. 306 Section 9.Except as otherwise expressly provided in this 307 act, this act shall take effect upon becoming a law.