Fla. Court Orders Southern Family Into Rehabilitation; Citizens to Receive Policies July 1

April 26, 2006

  • April 26, 2006 at 2:37 am
    Cheryl says:
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    If Mr. Poe had purchased adequate (or any) reinsurance and treated this business as something other than a politically connected cash cow, the whole situation may have been completely avoided and Florida might have still had another viable market in which to write property coverage.

    Shame on both Mr. Poe and on the State of Florida for knowingly letting this happen to the people of Florida.

  • April 26, 2006 at 2:49 am
    cowdogs3 says:
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    To say nothing of condolences to the former Poe policyholders who may next fall victim to Citizens. At least with Poe, they stood a chance of being with a company that was run nominally as a business. More than can be said of Citizens, whose day to day management and claim service is legend–or is that nightmare?

  • April 26, 2006 at 3:04 am
    CPCU says:
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    When will the people of FL realize that their political \”leaders\” are using insurance, specifically property and WC, to buy votes.

  • April 26, 2006 at 3:08 am
    Hmmm... says:
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    While I might agree that this was a \”cash-cow\” for Poe (he still gets away with some very LARGE take-out bonuses) and that rates were a part of the issue, this is moreover a Harvard Business School case-study for what is wrong with the P&C market in Florida.

    You have an understaffed, poorly managed claims organization. You have sub-standard telephony and systems. You have a revolving door of CFO\’s who can\’t tell a yellow book from the yellow pages. And you have underwriters who ignore the basic tenets of spreading the risk.

    What it all adds up to is another headache for the State, it\’s administrators, FIGA, Poe Financial\’s agency force, Citizens and most importantly the policyholders who were unlucky enough to have a policy (or doubly so, a claim!) with one of these three carriers. It never ceases to amaze me (and I\’ve been in this business for over 20 years now) how, in an industry that already has received more black eyes than all of Mike Tyson\’s opponents combined, we manage to keep punching ourselves in the face.

    At some point we\’ll hopefully figure out that it feels so much better when we stop.

  • April 26, 2006 at 3:10 am
    Seguros Insolvencia says:
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    D
    You miss understood me. Sorry. My \”didn\’t overcharge enough\” was a wise crack. Seems like the first thing people do is holler about \”overcharging\” when they get a bill. The worst thing that can happen to an insured is company insolvency and elected insurance commissioners always push rates down to get re-elected.
    The original purpose of an insurance commissioner was to monitor for the solvency of the company and protection of the insured.
    NONE actually do that today. They wait until the insolvency hearings begin and show up like Elvis impersonators at shopping center openings.

  • April 26, 2006 at 3:21 am
    Buzzard says:
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    Why is this \”unfortunate\” for Poe\’s salesforce, what were their ethics pushing a company saying they had great reinsurance (true the reinsurers were quality companies), when it was limited. Also, don\’t worry the Poe family was behind it. etc, etc etc.

  • April 26, 2006 at 4:16 am
    Hmmm... says:
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    If you are going to exclude agents because they don\’t know the specifics of an admitted carrier\’s reinsurance treaties(I believe Poe\’s was to the 100yr event on Cat cover, not sure if they had QS), then you would be hard pressed to find an agent in the state who could write a homeowners policy!

    The fact is that outside of the top five or six writers in the state, most if not all carriers write to the 100 year event. Agents don\’t know the level of saturation a carrier has within a given geographic territory. If the carrier is giving them capacity to write, it\’s a reasonable assumption that it is because they are balancing their book to another (more exposed) area in the state/region.

    When I say it\’s unfortunate, it is because of the breadth of the issue and the ultimate impact it will have in our own backyard. And in case you\’re wondering, I\’m a claims guy, so this isn\’t a \”woe is me\” letter… just an observation.

  • April 26, 2006 at 4:29 am
    Reinsurance Guy says:
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    Before anyone takes about reinsurance treaties as a reinsurance broker I can tell you the chances of getting capacity in Florida as of late – Slim with pricing from domestic players, London players & even Bermuda at 3 to 4 times expiring (if you can get it).

  • April 26, 2006 at 4:42 am
    Buzzard says:
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    So Fam didn\’t care about 100yr hurr etc.. At one time they were on 65% of the first $5mill of any one acct.. In other words if a Cat 4 storm hit Boca Raton after 20 Condo assns. were hit they were broke. Do the math their surplus before Charley was about $60 mill. 65% of 5mill is $3.25 mill x 20=$65mill. This isn\’t rocket science. Now Gallagher wants the state to stay on this business till the ann renewal date at the low rates. The state has never done this before why should they do it now? It\’s like saying set up a start up company write at lower than the mkt rate hope the wind doesn\’t blow, take your commissions out by setting up an MGA. When the wind blows your gone. Takes away the policyholders responsibilty to make a decision based on the carriers ability to pay. If they want the state guarantee with Citizens they should pay the higher Citizens rates.

  • April 26, 2006 at 5:37 am
    No More \"TakeOuts\"! says:
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    In the longterm, the only ones who will benefit from depopulation by \”TakeOut\” companies are PIGS like Mr. Poe.



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