Welcome to the
Office of Insurance Regulation
Freedom to Travel
Life Insurance Issue in Florida
On March 18, 2008, the Office issued a
press release regarding the Office's
administrative complaint against American General Life Insurance
Company.
Freedom to Travel is an issue that pertains to how life insurance companies use
information about an applicant’s intentions to travel to a foreign country as the basis
for denying life insurance or increasing the premium for life insurance.
The issue gained public attention after
U.S. Rep. Debbie Wasserman
Shultz, (D-FL), had her application to increase her life
insurance denied due to her “intent to travel” to a foreign
country.
Insurance Commissioner Kevin McCarty outlined the Office’s efforts at addressing the
Freedom to Travel issue in a Dec. 5, 2005
Letter to Rep. Wasserman Schultz.
Commissioner McCarty’s efforts helped lead the Florida Legislature to pass the
“Freedom to Travel Act,” in 2006, which was codified into law at
Section
626.9541(1)(dd), Florida Statutes. Commissioner McCarty urged Gov. Jeb Bush to sign the law
in a Letter to the Governor dated May 2, 2006. The Financial Services Commission finalized
Rule 69O-125.003, Florida Administrative Code, Nov. 1, 2007.
The Office issued its annual report,
2008 Report on Life Insurance Limitations on Freedom
to Travel March 1, 2008. The Office issued a similar report in
2007.
The law allows companies to utilize foreign travel in
underwriting provided they can demonstrate travelers to
a specific destination constitute an actuarially
supportable class. One company, Monumental Life
Insurance, petitioned for a variance from Rule
69O-125.003. The Office has issued an
order granting the variance, for two years (ending
February 15, 2010), for travel to Iraq and Afghanistan
based on the 'increased risk of death."
The Office maintains a
list of 105 companies that use travel-related questions on their
applications.
Since the passage of this legislation, the Office has fined companies more than $100,000
for noncompliance with the statute:
- American General Life & Accident ($7,500)
- Americo Financial Life & Annuity ($3,000)
- CUNA Mutual Life ($7,500)
- Great-West Life & Annuity ($22,500)
- Shenandoah Life ($22,500)
- USAA Life ($22,500)
- Western-Southern Life ($22,500)
Florida also is working with the National Association of Insurance Commissioners (NAIC)
to revise its (NAIC) model law on unfair trade practices regarding the use of intended foreign
travel as underwriting criteria for life insurance policies.