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Fla. Stat. § 627.840 (2025)

Limitation on service and other charges.

✓ 2025 Florida Statutes — current through the 2025 Regular Session
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627.840 Limitation on service and other charges.—
(1) A premium finance company shall not charge, contract for, receive, or collect a service charge other than as permitted by this part.
(2) A premium finance company may, in a premium finance agreement, contract for, charge, receive, and collect a service charge for financing the premiums under the agreement computed as provided in subsection (3).
(3)(a) The service charge provided for in this section shall be computed on the balance of the premiums due, after subtracting the down payment made by the insured in accordance with the premium finance agreement, from the effective date of the insurance coverage for which the premiums are being advanced to and including the date when the final payment of the premium finance agreement is payable.
(b) The service charge shall be a maximum of $12 per $100 per year plus an additional charge not exceeding $20, which additional charge need not be refunded upon prepayment. Such additional charge may be charged only once in a 12-month period for any one customer unless that customer’s policy has been canceled due to nonpayment within the immediately preceding 12-month period. However, any insured may prepay her or his premium finance agreement in full at any time before the due date of the final payment; and in such event the unearned service charge shall be refunded in accordance with the “Rule of 78ths,” or any other method at least as beneficial to the insured and approved by the office, and shall represent at least as great a proportion of the service charge, if any, as the sum of the periodic balances after the month in which prepayment is made bears to the sum of all periodic balances under the schedule of payments in the agreement. When the amount of the refund is less than $1, no refund need be made if the agreement so states.
(c) Such service charge shall be inclusive of all charges incident to the premium finance agreement and for the extension of credit provided for therein.
(d) Paragraphs (a)-(c) apply if the premiums under only one insurance contract are advanced or to be advanced under a premium finance agreement; if premiums under more than one insurance contract are advanced or to be advanced under a premium finance agreement, the service charge shall be computed from the inception date of such insurance contracts, or from the due date of such premiums; however, not more than one minimum service charge shall apply to each premium finance agreement.
(e) No insurance agent or premium finance company shall induce an insured to become obligated under more than one premium finance agreement for the purpose of obtaining more than one minimum service charge.
History.—s. 1, ch. 63-16; s. 1, ch. 69-224; s. 1, ch. 76-126; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 3, 4, 6, ch. 80-363; ss. 2, 3, ch. 81-318; ss. 604, 612, 809(2nd), ch. 82-243; s. 79, ch. 82-386; s. 114, ch. 92-318; s. 368, ch. 97-102; s. 1222, ch. 2003-261.
Notes of Decisions
Cited in 6 cases, 2002–2013 · leading case: Sosa v. Safeway Premium Fin. Co., 73 So. 3d 91 (Fla. 2011).
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Sosa v. Safeway Premium Fin. Co., 73 So. 3d 91 (Fla. 2011). · cites it 32× “According to the Third District, to prove the overcharges, the trial court would need to preliminarily and individually address each individual member's claims, as Safeway could have a different explanation and defense to an alleged knowing violation of section 627.840 for each…”
Safeway Premium Fin. Co. v. Sosa, 15 So. 3d 8 (Fla. 3d DCA 2009). · cites it 30× “§ 627.840(3)(b), Fla. Stat. (2002). Sosa claims that he and other Safeway customers are entitled to certain specific damages provided for in section 627.”
Restaurant Dev., Inc. v. Cananwill, Inc., 150 Wash. 2d 674 (Wash. 2003). · cites it 4× “18, § 4807 (d) (1999) (insurance premium financing); Fla. Stat. Ann. § 627.840 (West 2003); Ga.”
Soper v. Tire Kingdom, Inc., 124 So. 3d 804 (Fla. 2013). · cites it 2× “The Sosa majority concluded that even though Sosa brought a statutory claim that required proof that Safeway “knowingly” violated section 627.840(3)(b), Florida Statutes (2003), he did not need to provide proof that “Safeway ‘knowingly’ overcharged him in the motion for class…”
Restaurant Dev., Inc. v. Cananwill, Inc., 55 P.3d 680 (Wash. Ct. App. 2002). “Moreover, we doubt that it is coincidental that a number of other states have premium financing statutes that are identical in all material respects to Washington’s, including but not limited to Florida ( Fla. Stat. Ann. § 627.840 (3)(a), (3)(b) (West Supp.”
Sec. Life of Denver Ins. v. Shah, 906 F. Supp. 2d 1334 (S.D. Ga. 2012). · cites it 4× “Fla. Stat. § 627.840 . Florida’s Finance Companies Agreement Act defines a premium finance agreement as a promissory note or other written agreement by which an insured promises or agrees to pay to, or to the order of, a premium finance company the amount advanced or to be…”
— 627.840(2) — 1 case
Sosa v. Safeway Premium Fin. Co., 73 So. 3d 91 (Fla. 2011). “According to the Third District, to prove the overcharges, the trial court would need to preliminarily and individually address each individual member's claims, as Safeway could have a different explanation and defense to an alleged knowing violation of section 627.840 for each…”
— 627.840(3)(a) — 1 case
Sosa v. Safeway Premium Fin. Co., 73 So. 3d 91 (Fla. 2011). “According to the Third District, to prove the overcharges, the trial court would need to preliminarily and individually address each individual member's claims, as Safeway could have a different explanation and defense to an alleged knowing violation of section 627.840 for each…”
— 627.840(3)(b) — 3 cases
Sosa v. Safeway Premium Fin. Co., 73 So. 3d 91 (Fla. 2011). “According to the Third District, to prove the overcharges, the trial court would need to preliminarily and individually address each individual member's claims, as Safeway could have a different explanation and defense to an alleged knowing violation of section 627.840 for each…”
Safeway Premium Fin. Co. v. Sosa, 15 So. 3d 8 (Fla. 3d DCA 2009). “§ 627.840(3)(b), Fla. Stat. (2002). Sosa claims that he and other Safeway customers are entitled to certain specific damages provided for in section 627.”
Soper v. Tire Kingdom, Inc., 124 So. 3d 804 (Fla. 2013). “The Sosa majority concluded that even though Sosa brought a statutory claim that required proof that Safeway “knowingly” violated section 627.840(3)(b), Florida Statutes (2003), he did not need to provide proof that “Safeway ‘knowingly’ overcharged him in the motion for class…”
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This Florida statute resource is curated by the lawyer who curates this resource, a Jacksonville, Florida personal injury and workers' compensation attorney (Florida Bar No. 39104). Attorney Syfert regularly handles Chapter 627 matters in the context of insurance coverage law and represents clients throughout Northeast Florida. For legal consultation, call 904-383-7448.