If a daylily is no longer blooming as well as it did in previous years then it is time to divide it. If it is blooming only on fans near the outside of the clump then it is time to divide it.
In Florida, Munson advised that clumps should be divided every year in the fall. He probably had an eight to one or better increase ratio per year and so his clumps probably grew quite big in one year in his location and with his growing conditions (2 fans increasing to 16 in one year). He considered that the plants suffered if they were not divided that frequently.