PRODUCTION CREDIT ASSOCIATIONS OF FLORIDA AND FEDERAL LAND BANK ASSOCIATIONS OF FLORIDA, PETITIONERS,
v.
THE DEPARTMENT OF INSURANCE OF THE STATE OF FLORIDA, THE FLORIDA ASSOCIATION OF INSURANCE AGENTS AND THE FLORIDA FARM BUREAU FEDERATION, RESPONDENTS
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Production Credit Associations and Federal Land Bank Associations challenged a Department of Insurance order prohibiting their employees from being licensed as insurance agents under Florida Statute § 626.988. The court upheld the statute's blanket prohibition on insurance agents employed by financial institutions, finding no valid basis to distinguish the petitioners from other lending institutions.
Employees of Production Credit Associations and Federal Land Bank Associations may not be licensed as insurance agents. The petitioners are financial institutions within the meaning of § 626.988, and no valid basis exists to distinguish them from other lending institutions subject to the statutory prohibition.
[1] Employees of financial institutions, as defined by statute, are prohibited from being licensed as insurance agents.
[2] The Legislature may prohibit the licensing of employees of financial institutions as insurance agents when it determines such licensing is not in the public interest due…
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Join FLexlaw to unlock all legal intelligence“No insurance agent or solicitor licensed by the department of insurance under the provisions of this chapter who is associated with, under contract with, retained by, owned or controlled by, to any degree, directly or indirectly, or employed by, a financial institution shall engage in insurance agency activities as an employee, officer, director, agent, or associate of a financial institution agency.”
The statutory prohibition at issue that bars employees of financial institutions from being licensed as insurance agents.
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Join FLexlaw to unlock all legal intelligenceThe Department of Insurance issued an order determining that employees of Production Credit Associations of Florida and Federal Land Bank Associations…
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BOOTH, Judge.
This cause is before the Court on Petition for Review of final agency action of the Respondent, Department of Insurance, State of Florida. The order sought to be reviewed holds that employees of Petitioners, Production Credit Associations of Florida and Federal Land Bank Associations of Florida, may not be licensed as insurance agents by Respondents due to the prohibition of Florida Statute § 626.988, providing in part as follows:
“(1) For the purpose of this section the following definitions shall apply:
(a) ‘Financial institution’ means any bank, bank holding company, savings and loan association, savings and loan association holding company, or savings and loan association service corporation or any subsidiary, affiliate, or foundation of any one of the foregoing .
(2) No insurance agent or solicitor licensed by the department of insurance under the provisions of this chapter who is associated with, under contract with, retained by, owned or controlled by, to any degree, directly or indirectly, or employed by, a financial institution shall engage in insurance agency activities as an employee, officer, director, agent, or associate of a financial institution agency. . ." Respondent correctly determined that Petitioners are financial institutions 1 within the meaning of the above-quoted statute and that employees of Petitioners may not be licensed as insurance agents.
Insurance is an industry affected with a public interest2 and subject to regulation by the States.3 The Legislature has determined that there is potential for abuse inherent in financial institutions being involved in the sale of insurance, and that the licensing of employees of financial institutions as insurance agents is not in the public interest. No valid basis exists, either in the terms of the statute itself, or on the facts, for distinguishing Petitioners from any other lending institution in this regard.
Accordingly, Petition for Review is DENIED.
McCORD, C. J., and SMITH, J., concur. . See, 12 U.S.C. §§ 2012 & 2072, setting out powers and functions of federal land banks and intermediate credit banks.
. Springer v. Colburn, 162 So. 2d 513 (Fla.1964); 18 Fla.Jur., Insurance, § 16.
. “McCarran Act,” 15 U.S.C. §§ 1011-1015.
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Glendale Fed. Sav. & Loan Ass'n: Cmty. Fed. Sav. & Loan Ass'n of the Palm Beaches: Naples Fed. Sav. & Loan Ass'n v. State, 485 So. 2d 1321 (Fla. 1st DCA 1986)…court dismissing their second amended complaint challenging the constitutionality of section 626.988, Florida Statutes (1983). The trial court ruled that this court in the case of Production Credit Associations of Florida v. Department of Insurance, 356 So. 2d 31 (Fla. 1st DCA 1978), implicitly, if not expressly, found section 626.988 to be constitutional and to constitute the proper exercise of legislative authority. However, this court’s opinion in Production Credit did not dispose of the constitutional is…
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Glendale Fed. Sav. & Loan Ass'n v. State, 587 So. 2d 534 (Fla. 1st DCA 1991)…a. Both Plaintiffs and Defendants have filed motions for summary judgment, stating that no disputed issue of material fact exists. ** This Court originally dismissed this action on authority of Production Credit Associations v. Dept. of Insurance, 356 So. 2d 31 (Fla. 1st DCA 1978). The First District Court of Appeals [sic] reversed and remanded, holding that Production Credit did not rule on the constitutionality of § 626.988. Glendale Federal Savings and Loan Assn. v. Dept. of Ins., 485 So. 2d 1321 (Fla.…
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Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Springer v. Sherwood Colburn, 162 So. 2d 513 (Fla. 1964)