State RegulationsFL specificDifficulty 3/5
Which of the following best describes an unlicensed entity in Florida insurance law?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under Chapter 626, Florida Statutes, no person or entity may transact insurance - solicit, negotiate, or sell - in Florida without the license required for that activity; a person or business doing so is an unlicensed entity subject to penalties from the Department of Financial Services. This concept must be distinguished from an unauthorized insurer, which is an insurer lacking a certificate of authority: unlicensed transaction is a violation by the producer or entity, not merely the insurer's status problem.
Why the other options are wrong
- A) An authorized insurer that has not yet written business is still fully licensed and admitted; writing no policies is not a violation.
- B) A foreign insurer holding a Florida certificate of authority is authorized - its out-of-state formation is irrelevant to its licensed status.
- C) Late renewal of an insurer's certificate of authority is an insurer compliance issue; it does not make anyone an unlicensed transactor of insurance.
Memory hook
Unlicensed = selling insurance without a license.