Task Force on Citizens Property Insurance Claims Handling and Resolution: Meeting Recap

On Monday, June 4, 2007, the  Task Force on Citizens Property Insurance Claims Handling and Resolution met in Tallahassee, Florida. 

Task Force Chairman Bob Milligan, who is also Florida’s Insurance Consumer Advocate, opened the meeting.  

Tim Loftin, Citizens’ Senior Vice President of Claims, discussed Citizens’ claims handling procedures and how they have changed since 2004, when four major storms passed through Florida.  He discussed the claims process–from the insured reporting the claim, through disposition of the claim.        

Presentations then began from the Department of Financial Services (“DFS”), the Collins Center, and the Florida Insurance Consumer Advocate’s office regarding hurricane mediation.  Together, these presentations gave an overview of the hurricane mediation program provided by DFS and administered by the Collins Center, as well as a review of facts regarding the disposition of mediation cases in recent years.

A presentation regarding hurricane claims resolution was given.  Three resolution methods were discussed:  mediation, appraisal, and litigation.  According to the report, Citizens’ goal is to resolve more claim disputes during mediation before they reach appraisal, with litigation being the final and least preferred dispute resolution method. 

Citizens’ liability for combined wind and flood damage was reported to have been a major litigation issue.

Attorney William Merlin then discussed policyholders’ perspective of Citizens’ claims handling culture.   He recommended that Citizens adjust claims promptly and pay undisputed amounts immediately, as well as provide sufficient and trained adjusters.  He also reviewed historic problems and possible solutions, such as replacing multiple claims information systems with one system for all claims.

The Florida Association of Public Insurance Adjusters presented on what public adjusters are and their role adjusting an insured’s property insurance claim.  The presentation included a summary of the laws governing public adjusters in Florida and the need for public adjusters in the claims process.

Next, Tom Terfinko from DFS discussed consumer requests for assistance during the 2004/2005 Hurricane Season.  The major reasons for assistance requests included claims handling delays, disputes between adjuster estimates and contractor estimates, and a lack of understanding by the insured of their policy.

The next presentation was by Steve Bitar with Citizens’ Consumer Services Department,   who discussed his department’s focus on customer care.  He provided planned enhancements for complaint handling, including enhancements to Citizens’ website, www.citizensfla.com.  

Finally, there was a presentation on Citizens’ internal controls, including the statutory requirements regarding the procurement policy.  One statutory requirement is that procurements of goods or services at, or over $25,000 must be subject to competitive solicitation, subject to a few exceptions.  A review of the Office of Internal Auditor, which was created in 2005, was also given. 

The Task Force on Citizens Property Insurance Claims Handling and Resolution is authorized to make recommendations to the Florida Legislature for further action it deems appropriate.          

Meeting presentations can be accessed through the Task Force’s website, http://taskforceoncitizensclaimshandling.org/.

The next scheduled meeting of the Task Force is June 13, 2007 at Pensacola Junior College in Pensacola, Florida.

The above information is intended to be a brief summary of the presentations that occurred during the meeting.  It is not intended to be a comprehensive analysis of the discussion that took place or the materials provided.  We will be pleased to provide you with additional information upon request.  Please do not hesitate to contact this office should you have any questions or comments regarding the above matters.