Florida Citizens Property Insurance Committee Update–December 2015
Dec 4, 2015
Florida’s Citizens Property Insurance Corporation (“Citizens”) began its final round of Committee meetings for 2015 leading up to its Board of Governors (“Board”) meeting scheduled for next week, December 9.
F ollowing is a summary of Citizens’ on November 30 Claims Committee meeting, as well as its Information Systems Advisory Committee and Consumer Services Committee meetings held this week.
Claims Committee
Following a Request for Proposal issued September 8, Citizens’ Claims Committee met on November 30 and approved nearly $37 million in contracts with seven different appraisal companies hired to help settle up to 3,100 of its claims over the next four years.
Selected were Team One Adjusting Services, Claims Questions and Lozano Insurance Adjusters, which will work statewide.
The others–Connect Point Resolution Systems, CMD Affiliates, LLC (doing business as CatManDo), CIS Group and Pyka Associates–will be utilized on a contingent basis for catastrophe work, or in the event there is excess work that the primary firms cannot handle.
The Board is expected to consider the approval when it meets on December 9.
The Claims Committee also approved a $710,000 contract with ITEL Laboratories, a pre-existing vendor and the sole respondent to a competitive solicitation for flooring valuation services.
Citizens currently utilizes claims estimating software to determine replacement cost for carpet, pad, wood and other types of flooring. However this tool does not provide the ability to identify the actual type, quality and pricing specifications of damaged flooring and then accurately match to a comparable material and quality retail product. It was explained that a flooring valuation service provides this type of assessment more rapidly, accurately and with the latest, most comprehensive product data, thereby helping adjuster performance.
To view the meeting materials, click here.
Information Systems Advisory Committee
In addition to reviewing various information technology operations updates during its meeting on December 2, Citizens’ Information Systems Advisory Committee heard a report on a recent assessment of third-party cybersecurity risk specifically relating to the State-run insurer’s agents and agency relationships.
With the objective of identifying and evaluating risks associated with personal information relating to Citizens transactions that is either accessible by agents using Citizens’ systems or that agents store on their own systems, the assessment made recommendations for improving Citizens’ strategy to minimize these types of risks.
To view the report, click here. To view the complete meeting materials, click here.
Consumer Services Committee
Citizens’ Consumer Services Committee met on December 3, spending the majority of its time on reviewing the new “Call Citizens First” communications campaign, which was launched in September 2015 to increase awareness of claims resources available to Citizens’ policyholders, and educate them on the positive impact of good claims handling practices.
The program was implemented in response to a substantial increase in water damage claims occurring in South Florida that emanate from a public adjuster or an attorney, with the corresponding policyholders identified as never having even communicated with Citizens or their agent.
Citizens’ President and CEO Barry Gilway told the Committee that agents have expressed a desire to be proactive in the claims process.
“The issue is not just getting the agent involved,” he said, “but trying to get in front of the initial communication, so that the first time we hear about these claims is not three to six months later after the repairs have been made.”
Mr. Gilway recounted a recent meeting he had with Florida Governor Rick Scott, who offered his own claims handling experiences from the health care industry perspective.
The Committee also discussed various methods of rapid and mass communication with policyholders in the South Florida area, primarily to alert them that they are paying higher rates because of improper claims handling procedures.
“Consumers are paying a steep price for litigious environment in South Florida,” Mr. Gilway reminded.
To view the new “Call Citizens First” policyholder identification card, click here.
To read more about the program, click here.
For a summary of Citizens’ new fraud awareness public information campaign being conducted in conjunction with “Call Citizens First,” click here.
The Committee also reviewed plans for the December “soft launch” of Citizens’ new pay-by-phone option for policyholders to pay their premium using a checking account.
Committee members talked extensively about whether allowing payment by credit card might be afforded as an option, but it was explained that the vast majority of policies are paid by mortgage lenders, so implementing that has not been a priority.
The issue of adding a surcharge for credit card payments also was discussed, with a Committee member pointing out that many private carriers are adding such fees to their bills. A Citizens staff member explained that Florida law limits the percentage of a surcharge allowed to be recouped, but does not disallow the surcharge itself. The ability to recoup the entire fee would require a legislative change, it was said.
The Committee briefly reviewed Citizens’ most recent depopulation statistics, which showed that the assumption rate has risen beyond that of 2014.
To view the depopulation report, click here.
Citizens’ Clearinghouse performance has also increased–doubling over 2014, with 58 percent of personal lines policies now being represented.
It was reported that HO-6 coverage for condominium units will be available through the Clearinghouse before the end of 2015.
To view the Clearinghouse update, click here.
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