Prime Travel Protection investigation at crossroads after Vacation Superstore/Best Price Cruises filing

Florida’s campaign to stop unlicensed travel insurance appears to be at a crossroads. State regulators yesterday sent a two-count notice to Vacation Superstore Network/Best Price Cruises, with the by-now familiar charges: selling travel insurance without a required license, employing agents who didn’t have the necessary paperwork, and, of course, identifying customers who were affected by the alleged purchase of unlicensed insurance.

Here’s the document (PDF).
Continue reading…


Florida accuses three more travel agencies — wait, make that five more agencies — of selling unlicensed insurance

Looks like Palm Coast Travel has company. Florida regulators have filed charges against three more travel agencies as part of their expanding probe of unlicensed insurance offered through defunct Prime Travel Protection. (Two more agencies were added to the list at the end of today; see update at the end of this post.)

Ahoy Cruises of Jacksonville, Fla., JB Travel of Boynton Beach, Fla., and St. Lucie West Travel of Port St. Lucie, Fla., are accused by the state’s Department of Financial Services of violating several insurance-related statues — or, put differently, of selling fake travel insurance.

This is an important story, because bogus “trip protection” policies are known to have been sold to people across the country for years, potentially costing travelers millions of dollars in lost vacations.
Continue reading…


What was Palm Coast Travel doing with its Access America policies?

Florida’s Department of Financial Services is in the early stages of a far-reaching investigation into the activities of Palm Coast Travel and its affiliated companies, according to documents released this week under the state’s Public Records Act.

The documents also raise new questions about the relationship between Access America, the largest travel insurance company in the world, and Palm Coast Travel, which also does business online as

In a prepared statement, Access America yesterday suggested its current and future relationship with Palm Coast, which is accused of selling unlicensed insurance, is an internal matter.

“Thus far we have been contacted by both customers identified in the Florida investigation and we are working to resolve each matter appropriately,” a spokesman said. “Access America will continue to take steps consistent with providing ongoing care for its customers.”
Continue reading…


What’s next for Palm Coast Travel? Here’s what happened to agencies that settled with regulators

As I reported last week, Palm Coast Travel and its companies, including, are headed to a hearing with a Florida administrative law judge to determine if it sold unlicensed travel insurance. This is an important story, because fake “trip protection” policies are known to have been sold to people across the country for years, potentially costing travelers millions of dollars in lost vacations.

So what’s next for Palm Coast Travel?

There are two possibilities. First, the judge could rule the agency didn’t sell unlicensed insurance. But that’s unlikely, given the customers who have already complained to state regulators that they were sold these allegedly illegal policies. Second, the court could find Palm Coast Travel guilty of selling bogus insurance.
Continue reading…


In a twist, Florida levels new charges against Palm Coast Travel

Only a few weeks ago, Palm Coast Travel, one of three large travel agencies the state of Florida last year alleged had sold unlicensed insurance, seemed to have everything going for it.

The state’s investigation into its activities appeared to have hit a dead end. The company, which runs the site, had sued one of its customers and me in an effort to silence its critics. And it was issuing press releases at a regular clip, touting its Better Business Bureau rating and obsession with customer service.

But late last week, in an unexpected twist, Florida regulators filed an amended notice of intent to issue a cease and desist order (PDF) with more detailed charges against Lake Worth, Fla.-based Smolinski and Associates, Inc., which, in addition to doing business as Palm Coast Travel and, also operates under the names Smart Travel Group, Smart Cruiser Holdings and Tripsmart. (Update: A hearing has been set for April 8. Here’s the docket.) Any way you read the latest claims, it’s clear that Florida’s Department of Financial Services has no intention of letting this case fade away. (Here’s the first notice, for comparison purposes.)
Continue reading…


Palm Coast Travel sues a customer — and me

Here we go again.

Last March, I reported that the Florida regulators had warned three travel agencies that sold insurance policies offered by bankrupt Prime Travel Protection Services of Arvada, Colo., that its activities may have run afoul of state insurance statues.

I quoted Nina Banister, a spokeswoman for Florida’s Department of Financial Services, as saying the state had ordered the agencies to “stop transacting business” and that “they’re on notice that further activity is pending [by the state].”

Soon after that, Florida issued a press release stating, “As a result of ongoing investigations into complaints about the sale of unauthorized travel insurance in Florida, Chief Financial Officer Alex Sink has notified three travel agencies that she intends to order them to stop selling insurance.”

The legal notice to one of the agencies, Palm Coast Travel, alleges that the company “directly or indirectly acted as agent for or otherwise represented or aided one or more unauthorized insurers…” The matter is still pending.

Now Palm Coast Travel has sued one of its customers, Peter Lay, and me, alleging among other things that I defamed the company when I reported the story. Here’s the full text of the complaint (PDF).
Continue reading…


Florida alleges travel agencies sold unauthorized insurance policies

Florida has warned three travel agencies that sold insurance policies offered by bankrupt Prime Travel Protection Services of Arvada, Colo., that its activities may have run afoul of state insurance statues.

State authorities on March 5 issued an intent to order a cease and desist against Port St. Lucie, Fla.-based Vacation Superstore, which operates Best Price Cruises; Sarasota, Fla.-based Legendary Journeys and Lake Worth, Fla.-based Palm Coast Travel, which owns the site

Here are the filings against Vacation Superstore (PDF), Legendary Journeys (PDF) and Palm Coast Travel (PDF).

Florida had been investigating agents who sold the insurance offered by companies owned by Jerry Watson, including Prime Travel Protection and Vacation Protection Services.

Watson said his products are not insurance and that agents do not need a license to sell them. However, Florida investigators considered his products unlicensed insurance.

It is unclear whether the allegations will stop the agencies from selling other travel insurance products. The fate of the claims made against these agencies and Prime Travel Protection by travelers who bought the unlicensed policies are also uncertain. Previously, the agencies had indicated a willingness to review Prime Travel Protection-related claims, although there had been no reported settlements.

At this point, the Notice of Intention to Issue a Cease and Desist Order does not contain a final determination but only allegations that the agencies can contest.

Al Ferguson, Legendary Journeys’ vice president, said Florida’s orders would affect “a small number” of clients involved in the Prime Travel Protection and Vacation Protection Services bankruptcy, adding, “we will resolve each issue (hopefully) to the clients’ satisfaction.”

The notice from Florida is interested…and frankly very significant. A few notes that will come from this as I understand the reading:

1. This has nothing to do with travel services but the legal ability to sell travel insurance in Florida. It is important to make the distinction that this does not have anything to do with our CORE business but rather selling insurance.

2. The state, by examples, advises that the travel agents cited do not have license to sell insurance in Florida. We will quickly admit this fact. However, this interpretation means that no travel agent can sell insurance in Florida. While we have a single point of contact that carries the license to sell travel insurance, no other employee does. For that matter, I would suspect 99 percent of all travel agents in Florida do not carry an insurance license (like Allstate, and other core insurance brokers and sellers.) This is EXTREMELY important. Because, by this definition, we could not even sell Cruise Lines insurance that is offered by them because a Travel Agent does not have a license to sell INSURANCE. If this interpretation by the state is correct, dramatic changes are going to take place in Florida. I have been in the travel business for 28 years and this has never been the state’s position.

We will resolve this issue.

I asked John Cook, president of, for his analysis of Florida’s actions.

“This is an interesting turn,” he told me. “There are probably several infractions of Florida law.”

1. An unlicensed insurance company is selling policies in their state without being licensed.

2. the unlicensed insurance company is selling policies that have not been approved by the Florida Insurance Department.

3. The Florida agents who sold the products to consumers did not hold insurance agents licenses in Florida or if they did because they represent/ed a properly licensed company than they were not properly appointed by the unlicensed travel insurance company.

4. An individual or firm, whether properly licensed as an insurance agent or not, who sells an unlicensed product can be held responsible for the benefits promised under that product. This last part is important because even though the “service contract” company has gone into bankruptcy there is no protection for agents that sold the insurance and they may not only be subject to fines but they may also be held liable for any claims that otherwise would have been covered by the policy.

I think there will be more to come.

Update (March 12, 3:40 p.m.):

The state of Florida has issued the following press release:

Thursday, March 12, 2009 3:21 PM

FOR IMMEDIATE RELEASE CONTACT: Nina Banister or Jayme O’Rourke
March 12, 2009 (850) 413-2842


TALLAHASSEE-As a result of ongoing investigations into complaints about the sale of unauthorized travel insurance in Florida, Chief Financial Officer Alex Sink has notified three travel agencies that she intends to order them to stop selling insurance on behalf of Colorado-based Prime Travel Protection Services, Inc. and any other unlicensed travel insurer. Prime Travel Protection Services, Inc. was run by Jerry Watson in Colorado.

Sink issued legal notices to Palm Coast Travel, of Lake Worth; Vacation Superstore Network, Inc., DBA Best Price Cruises, of Port St. Lucie; and Legendary Journeys, Inc., of Sarasota, charging that they violated state law by selling insurance for Prime Travel, which is not licensed in Florida to sell insurance. The travel agencies have 21 days from the receipt of the Notice to respond. Other travel agencies are currently under investigation and may be named for selling this product.

Travel insurance can protect consumers against costs from unforeseeable circumstances, including trip cancellation, early return and emergency medical needs. Sink advises consumers to get confirmation that the insurer providing travel insurance protection is licensed by the State of Florida (Office of Insurance Regulation) before purchasing the product.

Consumers should also read the fine print before making a purchase, as the policies often contain exclusions for coverage, and obtain a schedule of benefits and a certificate of coverage. If the insurer providing travel insurance coverage is not licensed, claims may not be honored.

Floridians are encouraged to “verify before they buy” and contact the Department of Financial Services with any insurance questions or concerns. To verify licensure or to file a complaint, log on to or call 1-877-My-FL-CFO (1-877-693-5236).


As a statewide elected officer of the Florida Cabinet, Chief Financial Officer Alex Sink oversees the department of Financial Services, a multi-division state agency responsible for management of state funds and unclaimed property, assisting consumers who request information and help related to financial services, and investigating financial fraud. Sink also serves as the State Fire Marshal.

As I noted when I published this late yesterday, this is a fast-developing story. The original post contained information from an official source that was imprecise.

A representative from the state of Florida confirmed the intent to order a cease and desist yesterday. At the time, it was suggested to me that the agencies didn’t have a license to sell travel insurance and might also not have a license to sell travel.

This morning, I obtained the orders from a different source, which suggested the state’s actions only involved selling unauthorized insurance. I’ve updated the post to reflect that new information, and I apologize for any resulting confusion.

Update (March 13): John Cook responded to some of the comments on this post with an important point about liability.

There appears to be some confusion about whether or not travel agents have to be licensed in the State of Florida and at least one comment that this is new and that all or most travel agents are in violation.

Businesses in Florida have two types of licenses that they have to secure if they want to sell travel and travel insurance:

1. Seller of Travel registration: “Any seller of travel that has a business location in Florida or that offers to sell travel related services to persons in Florida for individuals or groups. As of July 1, 2008, an annual filing fee of $50 is required for each independent sales agent (s.559.928, F.S.).” This registration is with the Department of Agriculture and Consumer Services.

2. Travel Insurance License: “2-41 Resident Travel Insurance (Firm) Florida Statutes 626.321 (1) (c) defines “TRAVEL INSURANCE” as insurance against accidental personal injury or death covering the risk of travel. The license may be issued only too: To a full-time salaried employee of a common carrier or a full-time salaried employee or owner of a transportation ticket agency and may authorize the sale of such ticket policies only in connection with the sale of transportation tickets. No such policy shall be for duration of more than 48 hours or for the duration of a specified one-way trip or round trip.” This license is a limited license and does not have the same educational and/or examination requirements as required of life or personal lines insurance agents.

Just because a travel firm has registered with the Department of Agriculture and Consumer Services as a “Seller of Travel” it does not give them the authority to sell travel insurance without the Travel Insurance License that they must obtain from the Florida Department of Financial Services.

Contrary to some of the comments from readers many travel agents in Florida are licensed for travel insurance. A quick check on the Insurance Division’s web site shows that there are over 2,300 such agents in Florida.

Here is another section of Florida State Law that might help consumers. I mentioned it earlier but here is the specific:

Title XXXVII, 626.901 Representing or aiding unauthorized insurer prohibited.–

(2) If an unauthorized insurer fails to pay in full or in part any claim or loss within the provisions of any insurance contract which is entered into in violation of this section, any person who knew or reasonably should have known that such contract was entered into in violation of this section and who solicited, negotiated, took application for, or effectuated such insurance contract is liable to the insured for the full amount of the claim or loss not paid.

(3) No insurance contract entered into in violation of this section shall be deemed to have been rendered invalid thereby.

As I stated before it’s the responsibility of the travel agent to vet any company that they sell.