Citizens Board of Governors Meeting Report: May

Recently, Citizens Property Insurance Corporation (“Citizens”) held a Board of Governors (“Board”) meeting. To view the complete agenda, click here.

The meeting was called to order by Chairman Bruce Douglas, with a quorum of Board members in attendance. Also in attendance were:

• Scott Wallace, Citizens’ President
• David Emery, Citizens’ Executive Vice President of Insurance Operations
• Sharon Binnun, Citizens’ Chief Financial Officer (“CFO”)
• Curt Overpeck from Citizens’ Information Technology (“IT”) Department
• Citizens’ General Counsel, and Joe Bouthillier from the Florida Market Assistance Plan (“FMAP”)

Chairman Douglas started the meeting by repeating his comments expressed at the last Finance and Investment Committee meeting regarding the funding of the Insurance Capital Incentive Build-Up Program with Citizens’ surplus money. To view the comments, click here.

Ms. Binnun reported on this Finance and Investment Committee. To view a summary of the meeting, click here.

Credit ratings for Citizens’ High-Risk Accounts (“HRAs”) have been upgraded by Moody’s Investor Services to match those of the personal and commercial lines accounts. Fitch Ratings also has upgraded the rating on this account from stable to positive. Chairman Douglas added that international financier Warren Buffett has made public comments that Citizens has good credit standing.

Deleting SunTrust Capital Markets from the list, Ms. Binnun announced the HRA bond co-managers recommended at the Finance and Investment Committee as Banc of American Securities, JP Morgan, Merrill Lynch and Wachovia Capital Markets. The Board approved the HRA co-managers and Citizens’ investment policy for tax-exempt bond proceeds.

Mr. Emery gave the President’s and Vice President of Insurance Operations’ reports. Citizens is progressing on the following catastrophe preparedness goals:

• Increasing internal claims handling ability
• Independent adjuster managers policy training
• Mock catastrophe training
• Catastrophe plan refreshed
• More independent adjusters added

Mr. Emery added that Citizens’ claims school will be starting in August for adjusters and managers.

Ms. Binnun gave the CFO report, which included information on Citizens’ financial statements and the December 31, 2007 Audited Financial Statement. To view a copy of the February, 2008 financial statements, click here. To view a copy of the December 31 Audited Financial Statement, click here.

Mr. DeChene reported on Citizens’ Actuarial and Underwriting Committee, which recently met. At this meeting, the Committee voted to implement a 30-day waiting period for applicants without prior coverage in all personal residential programs. The Board approved the 30-day waiting period.

To view a summary of the last committee meeting, click here.

Mr. Overpeck gave an update on Citizens IT Department for the first quarter of 2008. The Department’s primary accomplishments for the first quarter of 2008 include:

• Acquiring license ownership of the ePAS system
• Addition of a new computer system to support ePAS
• Hiring new support staff members
• Hiring of a consulting firm to provide strategy services

To view a summary of the report, click here.

Mr. Horton reported on Citizens’ last Audit Committee meeting, which included a status update on the Office of the Internal Auditor. To view a summary report of this meeting, click here. The Board approved ratification of the 2008 Audit Plan.

Ms. Everhart discussed Citizens’ last Consumer Services Committee meeting, which included an update on the progress of e-mail notifications to policyholders. To view a summary report of this meeting, click here.

Mr. Bouthillier gave a report on FMAP. From 2006 through March 31, 2008, FMAP placed a total $1,932,466,142 of exposure into the private market. In 2007, Citizens contributed $163,007 to FMAP’s operation. Citizens’ contribution amount for 2008 and subsequent years is projected to remain steady. The Board approved the report, which can be viewed by clicking here.

The meeting was then adjourned.

Should you have any questions or comments, please do not hesitate to contact this office.