Colodny Fass Hosts Part 1 of Webinar Series “Pandemic + Hurricane”

To access webinar recording CLICK HERE.

On April 22, 2020, Colodny Fass held a webinar “Pandemic + Hurricane Part 1.” The webinar is the first of series of events to provide information relating to the COVID pandemic and how it will change how the state of Florida and the insurance industry prepare for the 2020 hurricane season. The hour-long webinar was hosted by Katie Webb, head of Colodny Fass’ Governmental Consulting practice, and featured presentations from Jimmy Patronis, Florida’s Chief Financial Officer and head of the Florida Department of Financial Services (“DFS”), Anne Bert of the Florida Hurricane Catastrophe Fund (“FHCF”), Kyle Ulrich of the Florida Association of Insurance Agents (“FAIA”), and Logan McFadden of the American Property Casualty Insurance Association (“APCIA”).

CFO Patronis told the participants that the DFS is continuing to serve the state and that the department’s more than 3,000 employees are teleworking. Patronis, who is also the state’s Fire Marshal, said he is working to ensure that firefighters and other first responders have appropriate personal protective equipment in order to safely do their jobs and ensure they are covered under the state’s workers compensation program. Patronis is also focusing on protecting consumers from fraud and other hurricane and pandemic-related scams. “People are vulnerable right now, they want solutions,” said Patronis, but there are “scammers that want to make a buck” off vulnerable consumers. He encouraged everyone to report suspected fraud and other scams through the department’s help line (877-MY-FL-CFO) or the “Free Florida” web portal at https://www.myfloridacfo.com/fraudfreeflorida/default.htm. Patronis has also worked with the insurance industry to make emergency regulatory changes to allow agents to obtain licensure and work remotely during the pandemic. He said he will continue to advocate to “make sure there is affordable, accessible insurance in the state of Florida.”

Anne Bert, the Chief Operating Officer of the FHCF, reviewed the FHCF’s financial situation. The FHCF has $11.7 billion in cash and $650 million in remaining pre-event bonds for approximately $12.4 billion to pay claims. The FHCF is below its $17 billion statutory capacity. Bert said that the FHCF is expected to pay out $6 billion due to Hurricane Irma and $1.5 billion for Hurricane Michael. Bert encouraged industry stakeholders to contact her or FHCF staff with any questions regarding what losses may be covered by the FHCF. Bert does not expect the pandemic will alter how the Fund pays claims.

Kyle Ulrich, Senior Vice President of Public Affairs for FAIA, focused on how agents and their carrier partners have worked together in the past and can work together in the future to help insurance consumers. He told the group that FAIA surveyed its membership about issues that arose during the 2018 hurricane season and the membership was concerned about issues with communication with its insurer carrier partners after storms. FAIA and the insurance carriers worked together to increase communications with agents during the claims process. Ulrich said both the carriers and his membership believe the improved communications practices helped consumers after Hurricane Michael. Ulrich said the industry should consider changing or creating alternatives to the “insurance villages” that have been used during past storm recoveries because setting up an insurance village might be very difficult during in a time of social distancing or quarantine.

Logan McFaddin, Assistant Vice President of State Governmental Relations for APCIA, discussed issues relating to business interruption insurance. She explained that business interruption insurance is not intended to cover losses caused by the virus and many policies contain a specific exclusion for viruses. A worldwide pandemic is not insurable, and insurers do not collect premium for it. McFaddin told the group that plaintiff attorneys are trying to include language in local emergency orders to force insurers to cover excluded claims even though the Governor did not include such language in the statewide emergency order. She also noted that legislatures in at least seven states are considering legislation to require insurers to cover business interruption due to the virus retroactively to the beginning of the emergencies. Such a requirement would endanger company solvency and make it difficult or impossible to pay other covered claims. McFaddin said APCIA supports recently enacted federal paycheck protection legislation and supports the creation of a federal COVID recovery fund to aid businesses in their recovery from the virus crisis.

During the Q and A portion of the webinar, Kyle Ulrich told the group that the CFO and DFS have issued an order to allow insurance customer representatives to work remotely. That order is effect until May 8. Ulrich believes that the CFO may extend that order as long as circumstances show that extension is necessary.

Colodny Fass will hold future webinars and events to provide timely relevant information to insurance industry stakeholders as they prepare for the 2020 hurricane season. A recording of the webinar can be accessed HERE.