Citizens’ Scott Wallace Comments on Cabinet Meeting Consideration of FHCF Bond Plan

The Florida Cabinet held a meeting today, June 10, 2008. 

The Cabinet considered a plan for the Florida Hurricane Catastrophe Fund Finance Corporation to issue and sell $625,000,000 in Florida Hurricane Catastrophe Fund Finance Corporation post-event Revenue Bonds. 

Below is a statement issued by Citizens Property Insurance Corporation President and Executive Director Scott Wallace regarding today’s proceedings.

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

  

Statement by Scott Wallace, President and Executive Director of Citizens Property Insurance Corporation, Concerning June 10, 2008 Cabinet Meeting:
 
At today’s Cabinet meeting, extensive discussion surrounded the need to secure additional funding for the Florida Hurricane Catastrophe Fund (FHCF) to cover outstanding claims resulting from the 2005 hurricane season and particularly adverse loss development relating to Hurricane Wilma.

For many months now, Citizens and other property insurers, the Florida Insurance Guaranty Association, the FHCF Advisory Council and others have expressed concern about the alarming number of new and reopened claims from the 2004 and 2005 hurricane seasons. Mention was made at the Cabinet meeting that some of these claims may be “illegitimate.”

As good stewards of our customer’s premiums, Citizens would not knowingly or willingly pay fraudulent claims.  We have internal quality assurance processes in place to ensure that claims receive a thorough review with proper documentation before they are paid. 

It should not come as a surprise that Citizens represents the largest share of this adverse loss development since Citizens represents 40% of the FHCF’s exposure.  And, importantly, Citizens insures more policies with wind coverage in Broward and Palm Beach counties, the areas hardest hit by Wilma, than any other insurer.

It is Citizens’ responsibility to properly adjust and pay the claims of our policyholders.  We will continue to do so, in the most effective and efficient manner possible, in order to carry out our public purpose.

 

 

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