Florida 2-20 General Lines Agent (Property, Casualty, Commercial Lines and Florida Law)Florida Law and EthicsHard
A Florida 2-20 General Lines Agent is explaining the concept of an 'unfair trade practice' to a new licensee. The new licensee asks for an example of misrepresentation in advertising. The agent provides an example where an insurer advertises a policy with a guaranteed annual return of 10%, when in reality, the return is variable and has historically averaged 4%. This is a clear violation of which Florida Statute pertaining to insurance?
- AFlorida Statute 627.736, Personal Injury Protection (PIP) Benefits.
- BFlorida Statute 624.401, Certificate of Authority Required.
- CFlorida Statute 626.837, Continuing Education Requirements.
- DFlorida Statute 626.9541, Unfair Methods of Competition and Unfair or Deceptive Acts or Practices.
Show answer & explanationAnswer & explanation
Correct answer: D. Florida Statute 626.9541, Unfair Methods of Competition and Unfair or Deceptive Acts or Practices.
Florida Statute 626.9541 specifically outlines 'Unfair Methods of Competition and Unfair or Deceptive Acts or Practices.' Misrepresentation in advertising, such as falsely guaranteeing a specific return on an insurance product, falls directly under this statute, as it is a deceptive act designed to mislead consumers.
Why the other options are wrong
- A. This statute pertains to auto PIP benefits, not advertising ethics.
- B. This statute deals with the licensing of insurers, not specific advertising practices.
- C. This statute outlines continuing education for agents, not unfair trade practices.
Florida Statute 626.9541 (Unfair Trade Practices)
A Florida Statute that defines and prohibits various unfair methods of competition and unfair or deceptive acts or practices in the business of insurance.
- Covers misrepresentation, false advertising, defamation
- Prohibits unfair claims settlement practices
- Aims to protect consumers from deceptive actions
Memory trick: Six Two Six, Nine Five Four One: No False Fun.