Florida Statutes 634.409 – Grounds for suspension or revocation of license
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(1) The license of any service warranty association may be revoked or suspended, or the office may refuse to renew any such license, if it is determined that the association has violated any lawful rule or order of the commission or office or any provision of this part.
(2) The license of any service warranty association shall be suspended or revoked if it is determined that such association:
(a) Is in an unsound financial condition, or is in such condition as would render its further transaction of service warranties in this state hazardous or injurious to its warranty holders or to the public.
Terms Used In Florida Statutes 634.409
- association: means any person, other than an authorized insurer, issuing service warranties. See Florida Statutes 634.401
- Impaired: means having liabilities in excess of assets. See Florida Statutes 634.401
- Insolvent: means unable to pay debts as they become due in the usual course of business. See Florida Statutes 634.401
- Insurer: means any property or casualty insurer duly authorized to transact such business in this state. See Florida Statutes 634.401
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Service warranty: means any warranty, guaranty, extended warranty or extended guaranty, maintenance service contract equal to or greater than 1 year in length or which does not meet the exemption in paragraph (a), 1contract agreement, or other written promise for a specific duration to perform the repair, replacement, or maintenance of a consumer product, or for indemnification for repair, replacement, or maintenance, for operational or structural failure due to a defect in materials or workmanship, normal wear and tear, power surge, or accidental damage from handling in return for the payment of a segregated charge by the consumer; however:(a) Maintenance service contracts written for less than 1 year which do not contain provisions for indemnification and which do not provide a discount to the consumer for any combination of parts and labor in excess of 20 percent during the effective period of such contract, motor vehicle service agreements, transactions exempt under…. See Florida Statutes 634.401
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- writing: includes handwriting, printing, typewriting, and all other methods and means of forming letters and characters upon paper, stone, wood, or other materials. See Florida Statutes 1.01
(b) Has refused to be examined or to produce its accounts, records, and files for examination, or if any of its officers have refused to give information with respect to its affairs or have refused to perform any other legal obligation as to such examination, when required by the office.(c) Has failed to pay any final judgment rendered against it in this state within 60 days after the judgment became final.(d) Has, without just cause, refused to pay proper claims arising under its service warranties or, without just cause, has compelled warranty holders to accept less than the amount due them, or to employ attorneys, or to bring suit against the association to secure full payment or settlement of such claims.(e) Is affiliated with, and under the same general management or interlocking directorate or ownership as, another service warranty association which transacts direct warranties in this state without having a license therefor.(f) Is using such methods or practices in the conduct of its business as would render its further transaction of service warranties in this state hazardous or injurious to its warranty holders or to the public.
(3) The office may, pursuant to s. 120.60, in its discretion and without advance notice or hearing thereon, immediately suspend the license of any service warranty association if it finds that one or more of the following circumstances exist:
(a) The association is insolvent or impaired as defined in s. 631.011.
(b) The association’s reserve account required by s. 634.406(1) is not being maintained.
(c) A proceeding for receivership, conservatorship, or rehabilitation or any other delinquency proceeding regarding the association has been commenced in any state.
(d) The financial condition or business practices of the association otherwise pose an imminent threat to the public health, safety, or welfare of the residents of this state.
(e) The association fails to affirm or deny coverage of claims upon the written request of the agreement holder within a reasonable time after notification of the claim.
(f) The association fails to promptly provide a reasonable explanation in writing to the agreement holder of the basis in the service agreement, in relation to the facts or applicable law, for denial of a claim or for the offer of a compromise settlement.
(4) A violation of this part by an insurer is grounds for suspension or revocation of the insurer’s certificate of authority in this state.