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Last Post 06/27/2008 3:31 PM by  ChuckDeaton
Citizens of Florida undercapitalized
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cowboy26995
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06/04/2008 10:09 AM

    Very interesting article wherein critics of Citizens stipulate it is woefully undercapitalized to pay claims from a major storm. We all know where adjusters stand in the priority of payment list. What guarantees are vendors getting from Citizens for payment? Do you want to take a chance?There should be ironclad guarantees in place before deploying or else?????????

    http://www.propertyandcasualtyinsur...02-FLAH-ap

     

    Marc Dubois
    Executive General Adjuster
    M.G.D. Claim Services Inc.
    "Your Commercial Claims Solution"
    KLS
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    06/04/2008 8:23 PM

    Marc you've made 104 comments in these forums so far.  You took part of one sentence out of an entire story and made it a head line here.  That wasn't even the real center of the article.  Sorry to say this, but I strongly disagree with you and several of the other posters recently making such statements about questioning work with Citizens of FL.  A demanding attitude to say "There should be ironclad guarantees in place before deploying or else?????????" tells me you don't have a lot of experience in this industry.

    Citizens of FL does not have to act like an insurance carrier and satisfy stockholders with profit like all the regular and surplus lines carriers.  They aren't necessarily held to the same capitalization like nationwide carriers.  Heck they don't even care what their AM Best rating is because it doesn't matter like it does to all the stock and mutual and privately held carriers.  They have a reserve that is sufficient for day to day operations and they don't have to ever worry about running out of money even for CATs because when the cash drawer gets low they simply send out bills to all the carriers writing coverage in Florida and get some more money and if that isn't enough they have access to state coffers and bond issues.  This is the absolute biggest and deepest money pocket for operations any business could ever have.  It’s a state run entity.  No adjuster or insured should ever have any question about being paid for a claim -- now the flip side of that is every policy holder in the state will eventually pay into the coffers through carrier assessments and maybe taxes but the claims will be paid and so will we as adjusters.  That lack of a draconian sword of money issues is why Citizens was so free with their claim payments in 04 and 05.  06 saw a tighter ship and I think 08 will see an even tighter grip to make sure claims are paid per the policy, per the endorsement and with correct claims handling.  The ship is making a turn around, it just takes a long time and a big ocean to turn such a behemoth around.

    If you don't care to work for a carrier, fine, move on.  There will be plenty of people willing and very happy to take your place, newbies and experienced.  However, negative attitudes will transcend carriers and those people who continually show that kind of attitude will be the first to be let go from a storm, to not get the call next time and after a while, those people are struggling with the bottom feeding vendors wondering what went wrong and why they don't get the good spots anymore.

    I fully agree with a frequent poster here that "Knowledge and Attitude" can make or break you in this business.  We must know this trade and We must have a positive attitude toward the trade and We must have a caring attitude toward the Insured to succeed over the long haul.  Anything less and We might as well go back to work for McDonalds.

    KLS (Not a "General Executive Adjuster" -- Just working full time, for a long time, and loving every minute of it)

    jlombardo
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    06/05/2008 7:55 AM

    Kim,
    Good post, but Marc has some valid points....Even our State Chief Financial Officer, Alex Sink, has openly stated that she is very concerned about the amount of reserves that Citizens has available....and their ability pay claims in a major event....

    Funny that you refer to Tom Toll's "Knowledge and Attitude" posts..........HE WILL NOT WORK FOR CITIZENS OF FLORIDA EITHER.......so maybe it is not a lack of a "lot of experience in this industry" for Marc, but rather the possession of some good old fashion common sense.....

    Just my .02

    Joe Lombardo Jr.

    tonyd46
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    06/05/2008 9:39 AM

    Kim,
    I disagree with you on many points. To say that experianced adjusters will work for a company that has already demonstrated in the past that they have no knowledge of how to handle and pay claims let alone pay their adjusters is foolish. I personally know adjusters that had the misfortune to work citizens in 04-05 and still haven't goten paid let alone the insured's who are still in court with citizens over their loss. So explain to me why any adjuster would take a chance of working for a company with that sort of reputation. I had the oppertunity to attend a free citizens face to face the other day and to my surprise there were over 2/3 of the class that had less then 2 years actual adjusting experiance. The presenter could not answer any valid questions about how they will or will not change the adjusters estimates and their claims handling setup reminds me of a chinese fire drill.Have you ever been an independant adjuster? If you have then you know just how important it is toi get paid when you work a storm.With citizens there is no guarantee and as mark says if you want to take a chance and work for them they need to give us some sort of guarantee on our pay.
    In my opinion the adjusters that have experiance and good reputations will work for other carriers and will leave citizens to care for themselves.This may not be air to the insured's but as an independant adjuster we have to careful who we work for as all the expence is on us and who wants to lay out the money up front and not be paid.Citizens has a long road ahead of them to show us that they have turned thjemselves around untill then they will get the feedback that they are now getting.Also you comment about deep pockets falls on deaf ears just ask the insured's of Florida who are still dealing with the nightmare of citizens from 04-05.Deep pockets are no guarantee of payment and this forum is just the place to let everyone know just how each and everyone of us feel. Till you walk a mile in an adjusters shoe's who worked in good faith for this carries and hasen't got paid and is still trying to collect then you comments on their negative statements should be tempered with understanding. I agree with mark and untill a fund is established to guarantee that the adjuster fee's can be paid citizens will be the last place I would ever work. And to let you know I have been and independant adjuster for over 20years and I have never had my experiance put to question like you did to mark. Experiance is what makes a good adjuster just like an informed adjuster picks and chooses who he works for and that is why citizens is getting all the write ups it is. They have already proven that they are not a company who pays their adjusters. But please feel free to work for them and then after it is all done and said let us know if you were paid in full for all your files.
    Just my 2 cents on the subject.

    okclarryd
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    06/05/2008 9:42 PM

    I have responded to each and every one of the emails regarding the Citizens "face-to-face" seminars with a polite request to remove me from any and all lists pertaining to Citizens.

    You think for a minute I'm gonna give up my status and seniority here at the Parlor to go to Florida?

     

    Larry D Hardin
    sbeau4014
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    06/05/2008 10:07 PM
    Larry,

    By chance are you working at the parlor next to the Red Dog Saloon???
    HuskerCat
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    06/06/2008 12:41 AM

    There must be some discrimination going on, because I haven't received any of those emails.  Maybe Huskers are weeded out.

    Medulus
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    06/06/2008 7:04 PM

    There don't seem to be as many emails as last year, but then some people already knew I have come in off the road. 

    A quick question to the artist formerly known as Racko.

    Are you begging for emails to sign up for Citizen's?

    From what I understand Kim is right about the capitalization of Citizens.  Of course, if you are a Florida resident you can prepare to pay through the nose to support Citizens operations.

    And for my two cents on Citizen's:

    I compare Citizen's of Florida in many ways to State Farm circa 1995 to 2000.  They are a large carrier with lots of policies.  They believe that entitles them to make extra demands of adjusters who work for them.  When I went independent in 1998 I worked most of the first year for State Farm.  The money was pretty good and I had lots of work.  But the demands were far more than anyone else forced upon adjusters working for them.  The qualifications included testing for different types of losses, watching the "Nice Shoes" video for the umpteenth time, and following every whim of every "cat manager" who was adjusting autos last week at his regular position and every 22 year old "reinspector"  who graduated claim school last month.  And then there were those #$#$% hand written log notes for everything you thought about doing while handling the claim, the lousy polaroid photos, and the #$%#^%$%% dictation of a letter to accompany every payment or every other move you made.  You couldn't load their form letters into your computer.  Oh, of course not!  You had to dictate them.  Then you had to wait (sometimes days) for the dictation to come back before you could send the payment and close the file.  Meanwhile the insured was calling and demanding to know where their money was since you had told them days ago you were handing in the payment request.  Then there was a spelling error and you had to send the letter back to dictation because, God forbid, you couldn't fix the spelling yourself.  In the meantime, the farm had changed the price they were using on drip edge so you had to change your estimate and then dictate the new figure into your letter.  Lo and behold, when I finally started working for other carriers, I found I was making exponentially more money.  Twice the money for half the work.  Seemed like a plan to me!  I never worked for State Farm again.

    Citizens of Florida is doing the same thing.  They may be computerized and handwritten log notes may be a thing of the past, but the principals are still the same.  The demands for qualification and the procedures for claim handling keep changing at the whim of someone.  If you vary from the procedure you won't be paid, and you might even be fined.  They are banking on the fact that they are Florida's largest insurer to attract good adjusters.  But when the hurricane hits, the best adjusters will be working for someone else who is more concerned about getting their insureds paid (and paid the correct amount based on skilled file handling) than they are concerned about the intricacies of procedure or whether you accepted a demitasse of Cafe Cubano offered in accordance with the laws of hospitality by a well meaning insured.

    I won't be available this hurricane season, but my best wishes are with all the independents still out there.  And my condolences go out to those who end up deciding to work for citizens. 

     

    Steve Ebner CPCU AIC AMIM

    "With great power comes great responsibility." (Stanley Martin Lieber, Amazing Fantasy # 15 August 1962)
    katadj
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    06/06/2008 9:59 PM
    It does appear that the BIG RED people are intimately involved in the Citizens workshop. It is not Santa's BTW. Steve and other posters are correct. If you live in FL and the "BIG ONE" hits, the population may decline significantly, Hasta la Vista, baby
    "Anyone who has never made a mistake has never tried anything new... Albert Einstein"
    Ray Hall
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    06/06/2008 10:04 PM

    Steve you did a much better job than I could on this carrier. This business is one size fits all to the Farm. I remember 88,89 and 90 when this bunch was the best to work far, The top man was out of Pittsburg and we turned some files and made some dough. It seems they found out a bunch of IA contractors could not ne trusted, ot thought they could not and came up with the Guide lines with SF auto adjusters working on overtime to supervise old hands who could "close good files" thats progress???

    cowboy26995
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    06/06/2008 11:56 PM

    Kim I've been in the claims business for thirty four years and will not dignify your comments about my experience level. If you read this site at all my peers speak for me. You are free to choose to work for whom you wish as I am. Rest assured I will not be idle come storm season and have sufficient agreements in place with folks that pay me very well and on time.

     

     

     

    Marc Dubois
    Executive General Adjuster
    M.G.D. Claim Services Inc.
    "Your Commercial Claims Solution"
    okclarryd
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    06/07/2008 9:49 AM
    Steve,

    No, that's the wrong one.

    The one that I work for is off of NE 13th street with an alley entrance.

    Larry D Hardin
    katadj
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    06/10/2008 8:58 PM

    So under capitalized that the Governor today sold 650 MILLION dollars in Bonds to cover Wilma losses. This will cost the Floridians another 2% on premium over the next 2 years .

    Read it and weep:

    http://www.forbes.com/feeds/ap/2008...01726.html  

    And this also:

    http://www2.tbo.com/content/2008/ju...-issue-bo/

    "Anyone who has never made a mistake has never tried anything new... Albert Einstein"
    katadj
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    06/10/2008 9:13 PM

    Posted By Marc Dubois on 06/06/2008 11:56 PM

    Kim I've been in the claims business for thirty four years and will not dignify your comments about my experience level. If you read this site at all my peers speak for me. You are free to choose to work for whom you wish as I am. Rest assured I will not be idle come storm season and have sufficient agreements in place with folks that pay me very well and on time.

     

     

     And i would like to add to the credence of Marc's repertoire, as having worked in Canada with him in '98, his capabilities, ethics and resourcefulness are beyond anyone's ability to critique.

    So Kim, your commentary will fall only on the deaf ears of the incompetent, let the chips fall where they may...

     

    "Anyone who has never made a mistake has never tried anything new... Albert Einstein"
    Dimechimes
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    06/10/2008 9:21 PM
    Dave- thanks for posting that article. I cannot believe the comments in this article about independent adjusters and the comments of Crist about his feelings about property insurers :

    Catastrophe Fund Director Jack Nicholson said his office wasn't aware of any specific fraudulent claims. But he assured Crist and Sink that the agency will conduct audits to make sure that it isn't reimbursing insurance companies for claims they shouldn't have paid.

    Nicholson also said if there was a problem it was likely independent adjusters convincing homeowners that they may have claims they can file, even though Wilma was three years ago.

    Insurance industry spokesman Sam Miller also blamed adjusters who "are aggressively advertising, saying 'We will get you more money.'"

    *****
    Now is that not also sad that the Catastrophe Fund director doesn't know the difference in an independent adjuster versus a public adjuster?
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    katadj
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    06/10/2008 9:30 PM
    Well now pardner,

    In this new regime, you only get what you pay the most for. You can pay me a little now or a lot more later. If they hire incompetence they deserve what they get. Unfortunately, the Floridians that pay the premiums will only get the shaft, whilst the "powers that be" who have limited knowledge will get their ill deserved weekly check.
    "Anyone who has never made a mistake has never tried anything new... Albert Einstein"
    Dimechimes
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    06/10/2008 9:57 PM

    You might also want to read about the Citizens  alleged 300 million dollar claim reserve problem which was in the news this past August. The task force has the original article and the Citizens rebuttal up here:

    http://taskforceoncitizensclaimshan...sMedia.htm

    Just look down the page under news where it says Citizens asked to Increase reserves

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    Ray Hall
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    06/11/2008 3:28 PM

    I have a list of 47 vendors who were on the citizens list in 2006. I will start by sending each one my demand of $10.00 per file for a fuel surcharge like TWIA pays. I will also ask for 70% commision on the published fee schedule as I do not need a file checker as Simsol pays this for sr. adjusters.

    I will date the letter April 1, 2008 and put in a PS.... APRIL FOOL, as I will not work for Citizens; if any other insurance companies exist.

    okclarryd
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    06/11/2008 9:35 PM
    Ray,

    Quit foolin' around and tell 'em what you're really thinkin'
    Larry D Hardin
    katadj
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    06/18/2008 2:31 PM
    And now, More of the story on Citizens and the unending confusion:

    http://newsfeedresearcher.com/data/...27.46.html
    "Anyone who has never made a mistake has never tried anything new... Albert Einstein"
    Florida Boy
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    06/18/2008 2:52 PM

    Posted By Deborah Moroy on 06/10/2008 9:21 PM
    Dave- thanks for posting that article. I cannot believe the comments in this article about independent adjusters and the comments of Crist about his feelings about property insurers :

    Catastrophe Fund Director Jack Nicholson said his office wasn't aware of any specific fraudulent claims. But he assured Crist and Sink that the agency will conduct audits to make sure that it isn't reimbursing insurance companies for claims they shouldn't have paid.

    Nicholson also said if there was a problem it was likely independent adjusters convincing homeowners that they may have claims they can file, even though Wilma was three years ago.

    Insurance industry spokesman Sam Miller also blamed adjusters who "are aggressively advertising, saying 'We will get you more money.'"

    *****
    Now is that not also sad that the Catastrophe Fund director doesn't know the difference in an independent adjuster versus a public adjuster?

    Perhaps the CAT fund director is a political appointee?

     

    sbeau4014
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    06/20/2008 7:29 PM

    Here is the latest from the Insurance Journal.  They have just arranged to "borrow" more $$ in the event of a storm, which in effect would put more assessments on all the insured people over the entire state.  They already have about 6-8 more years of assessments just to pay off the 04/05 storms.  I have also cut and pasted the one comment that someone made to this article and it tells you a lot:

    Florida's Citizens Secures $1.75 Billion for its High Risk Account

    • Florida's state-backed Citizens Property Insurance Corp., says it has secured pre-event financing of $1.75 billion for its high risk account.

    This amount is in addition to the $1.6 billion bank credit line obtained for the personal lines account and the commercial lines account, according to board chairman Bruce Douglas.

    "We have completely restructured the liquidity program, which will benefit all Floridians if a disaster were to strike Florida," said Douglas.

    Citizens sold $1.75 billion of one- and three-year securities at yields ranging from 2.5 percent to 4.37 percent. The financing provides Citizens access to cash it may need to pay future claims in its high-risk account.

    Additionally, Citizens recently completed the purchase of private reinsurance for the high-risk account for the mandatory co-payment required to access funds from the Florida Hurricane Catastrophe Fund in the event of disaster. The purchase of reinsurance in the high-risk account transfers over $450 million of potential risk and assessments from Citizens' customers and all Floridians to the private insurance market.

    Sharon Binnun, Citizens' CEO reported that its rating with Moodys increased from A3 to A2 and Citizens has received the highest rating possible for short term municipal credit."

    Source: Citizens Property Insurance Corp

     

    Subject: Simply amazing

    Posted On: June 20, 2008, 2:51 pm CDT
    Posted By: Stan
    Comment:
    It is really disturbing that this story paints Citizens as financially solvent and able to handle anything other than a small event storm. Lets not forget that we still have assessments for the next 8 years to pay back POST-EVENT for claims in 2004-2005
    This carrier has rates frozen for the next 18 months, pretty good policy forms compared to the take out companies, and the ability to push the losses on to the backs of everyone else when they have to pay a claim. I'm sorry but what are the elected officials thinking when they allow, no create this kind of mess. Remember this in November when we can clean house (& Senate) of some of the idiots in Tallahassee. The Government sucks at everything it does, why do we allow them to screw up insurance as well?
    Dimechimes
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    06/24/2008 10:13 AM

    This is a real eye opening article posted on the Florida Insurance Council website discussing the Claim Crisis and the FL Catastrophe Fund that provides in depth commentary about Citizens of FL claims handling capabilities.

    http://www.flains.org/content/view/1574/38/

    You'll also find this link very informative about the THOUSANDS of licensed FL staff, independent, public adjuster licenses issued in FL through September 07 (numbers show resident and non resident). Very interesting as well are the numbers of adjusters used during Andrew in FL. It makes you wonder how well prepared FL Citizens will be to handle the claims should an Andrew size storm hit FL when the 6,000 independents they say are on the vendor rosters doesn't come close to the number of Independents used in FL after Andrew (by all carriers) as well as the many other factors which would change the numbers of adjusters need in a 2008 storm the size and strength  of Andrew. The newest RFP recommendations for 30 vendors (https://www.citizensfla.com/about/m...;when=Past">see 6/18 Claims Committee documents for names here on left column item 03E ) for 9/08 daily and 09 cat vendors lists about 4200 adjusters available for those vendors and we all know that just because someone took the face to face training doesn't mean any guarantee the adjuster would be available to work Citizens claims if they have accepted an assignment with other carriers. Here's the license info referred to above:

    http://www.flains.org/content/view/752/51/

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    Tom Toll
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    06/24/2008 4:08 PM

    Everyone needs to read all of this, TWICE. As I said over 6 months ago, just because its Citizens and their funding is now questionable, there is no guarantee an adjuster will get all his billing paid if they go under, and that is very possible on a massive disaster. With so many rules and regs, and their being so top heavy, I personally will not work for them. I don't mind regimentation, but they have gone all the way with it. As Hood says repeatedly, KNOW BEFORE YOU GO.  If a minimal event occurs, I see no problems with them financially, but if the BIG ONE hits, there will be trouble in river city.

    Success is not final, failure is not fatal: it is the courage to continue that counts.
    katadj
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    06/25/2008 6:25 AM

    Fellow cat adjusters, staffers and other interested adjusters,as well as every florida policy holder.

     

    The in depth report at the botton of dimechimes statement was made by one of the formost economic institutions in the USA

    It should be a MANDATORY READING for anyone who lives in, or intends to work in, the stare of Florida.

    11. Thirty percent of each dollar paid for flood insurance coverage goes to private
    insurers participating in the NFIP Write‐Your‐Own (WYO) program. These insurers play
    the role of financial intermediaries between policyholders and the NFIP but do not bear
    any of the risk. Over the period 1968‐2005, these private insurers received over $7.4
    billion (excluding the loss adjustment expenses for which we do not have data) in fees.
    Turning to the financial operation of the program, prior to the 2005 hurricane season,
    which inflicted nearly $18 billion in flood claims, the NFIP had a cumulative deficit of
    about $3 billion after 37 years of operation.

    Like to hypothacate who will be the winners and loosers in a food senairo?  See the NFIP pays the WYO to sell the policy, pays for them to servive it AND pays the loss.

    This is only the tip of the iceberg that sunk the Titanic. If you have the guts to read it all, then you are in for a suprise of a lifetime

    Anyone that thinks that a Heavy Florida Hurricane hit will be their salvation, may just find  that it becomes their ruination

    http://grace.wharton.upenn.edu/risk/library/Wharton_LargeScaleRisks_FullReport_2008.pdf

     

    "Anyone who has never made a mistake has never tried anything new... Albert Einstein"
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