Citizens’ First Policyholder Public Forum Held in Fort Lauderdale
May 21, 2007
As part of an effort to increase its customer service in its newly-funded expansion, on Tuesday, May 15 in Fort Lauderdale, Citizens Property Insurance Corporation (“Citizens”) held the first of several public forums designed to give its policyholders a chance to interface with Citizens officials and customer service specialists.
Because South Florida has the highest percentage of Citizens policyholders statewide, Fort Lauderdale was chosen as the kickoff location for the series of forums.
The audience of approximately 300 consisted of mostly policyholders, private citizens and insurance agents. Some State Legislative and Congressional staff members (from Representative Ron Klein’s office) were recognized and the following State Legislators were also in attendance:
• State Representative Elaine Schwartz
• State Representative Kelly Skidmore
• State Representative Evan Jenne
• Former State Representative Ken Gottlieb
• State Representative Franklin Sands
• Senator Jeff Atwater
• Former Senator Ron Silver
Representative Sands was highly assertive in asking questions later on in the meeting. Senator Atwater was given the podium to address the group.
Citizens’ Chairman Bruce Douglas opened the forum with an informational overview on the state of Citizens and advent of its ability to offer commercial policies
Douglas cited a media misunderstanding about Citizens’ ability to pay claims and its financial status. He explained how the Florida Hurricane Catastrophe Fund operated and how legislation was designed to lower reinsurance consumer insurance costs.
Citizens’ Executive Vice President Susanne Murphy spoke and elaborated on Chairman Douglas’ comments.
Paul Palumbo, Citizens’ Senior Vice President of Underwriting, discussed the rate rollbacks and new mitigation legislation.
Christine Turner, Citizens’ Director of Communications and Legislative Affairs explained the new expanded multi-peril offerings and gave an overview of SB 2498. She also discussed the creation of the new post of “Consumer Advocate” and introduced the newly-hired Steve Bitar, who has filled that role as “Assistant Director of Agent and Consumer Services.”
The discussion was opened for public participation.
Representative Sands engaged Chairman Douglas with rapid questions, including inquiring about unresolved claims from the most recent storms. Chairman Douglas indicated that there had been a meeting with a Legislative Task Force on this subject and that the reason for the unresolved claims involved a dispute as to the amount constituting fair payment on each of these claims.
Representative Sands asked how Citizens policyholders will know if they are entitled to part of the $300 million refund. Chairman Douglas said that anyone who paid premium on their policies after January 1, 2007 will receive a refund.
Representative Sands asked Chairman Douglas to put a dollar amount on the Citizens’ exposure. Chairman Douglas responded by explaining the terminology of “exposure” versus “probable maximum loss,” “surplus” and “insured value” and exactly how much an assessment would be statewide in various scenarios. He also explained that assessments can be charged over the course of 10 years and do not have to be charged all at once, but that auto policyholders will also be affected in the event of an assessment.
One mobile homeowner aggressively questioned Chairman Douglas, but apparently did not understand Citizens’ operations and the difference between it and private insurance.
An agent in the audience asked whether Citizens’ windstorm policyholders will automatically be offered multi-peril coverage upon renewal of a windstorm policy. Chairman Douglas indicated that yes, policyholders will be notified.
Another audience member inquired whether the rate rollback applied to all private insurance. Douglas responded that no, the rollback was only for Citizens policyholders.
A question about condominium self-insurance was raised. Douglas said that although Citizens was not involved in self-insurance, that lately, very large companies such as Berkshire were showing interest in funding self-insurance and that he expected the self-insurance market to develop quickly in the near future as a result.
Senator Atwater’s speech included his rationale for voting as he did regarding SB 2498 and other insurance issues. He said that South Florida’s economy has long funded other infrastructure and localized Florida economies, and that the “risk-spreading” through a potential future Citizens assessment to other Floridians was thereby justified. Senator Atwater also said that he would not tolerate unfair or discriminatory treatment by Citizens, and that such unfair treatment would be grounds for a lawsuit.