Department of Insurance (DOI) licensees are often surprised to learn that their seemingly-personal-and-unrelated-to-their-profession criminal matter, is in fact one upon which they can get dinged for license discipline. Often, they just do not believe that their conviction was related to their profession. For example, what does a disturbing the peace conviction have to do with selling life and casualty insurance?
However, the DOI has a broad definition of what is considered “substantially-related to the profession”. Specifically, Title 10, California Code of Regulations, Section 2183.2, 2183.3 and 2183.4, a crime or act that is substantially related to the qualifications, functions or duties of an insurance licensee includes, but is not limited to, the following:
- Any felony;
- Any misdemeanor which evidences present or potential unfitness to perform the functions authorized by the license in the manner consistent with the public health, safety, and welfare, including but not limited to soliciting, attempting, or committing crimes involving the following:
- Dishonesty or fraud;
- Any conviction arising out of acts performed in the business of insurance or any other licensed business or profession;
- Sexually related conduct affecting a person who is an observer or non-consenting participant in the conduct or convictions, or which requires registration pursuant to the provisions of Section 290 of the California Penal Code;
- Resisting, delaying, or obstructing a public officer in violation of California Penal Code Section 148;
- Any act or offense wherein the person willfully causes injury to the person or property of another;
- Violation of a relation of trust or confidence, or breach of fiduciary duty;
- Conduct which demonstrates a pattern of repeated and willful disregard of law.
- Any act which demonstrates a willful attempt to derive a personal financial benefit through the nonpayment or underpayment of taxes, assessments, or levies duly imposed upon the licensee or applicant by federal, state or local government or a willful, failure to comply with a court order.
The application of this standard is problematic. That is because the DOI also has a reporting requirement. And as previously discussed, this can result in license discipline in its own right. So, a licensee seemingly engaging in some less-than-admirable conduct while at home, out with friends, or even in a completely different state, could all of the sudden trigger two levels of license discipline, in addition to criminal charges.
So, the moral of this story is – be good! Otherwise, be prepared to face a prolonged downward spiral of negative consequences.