Monday, February 07, 2005

Groundhog Day

The Pensacola News Journal headlines today a week-old report by Paige St. John in which the superb reporter for Gannett's Tallahassee bureau reveals that state-owned Citizens Property Insurance has taken back some 7,000 hurricane claim files which subcontractor adjusting firms screwed up.

Most of the files are for Hurricane Ivan victims. That means us, here in Northwest Florida.

The net result is that unfortunate customers of Citizens will have to begin the claims process all over again.
Thousands of Citizens Property Insurance customers are back at square one, more than four months after hurricanes damaged their now-rotting homes.

The state-run insurer has taken control of almost 7,000 claims that had been in the hands of problem private adjusters. In most cases, that means starting the process over for homeowners left without roofs since September and August.
St. John's article first ran on February 2, Groundhog's Day, in the Ft. Myers area News-Press .The Pensacola News Journal doesn't say why editors of our 'daily' paper took five full days before publishing the dispatch on the front page as today's main headline. (So much for the 'synergies' of media mergers.)

If Hollywood ever makes a movie about Florida's 2004 Hurricane Season, Bill Murray should be hired to play two parts -- Doug McCorkindale, CEO of Gannett, and state CFO Tom Gallagher, who supposedly oversees Citizens Property.

A little way down St. John's piece is the admission that "Citizens, which is Florida's largest hurricane insurer, admits to delays in handling 116,000 hurricane claims."
Company officials blame a decision made years ago to rely entirely on third-party adjusters. The problem: Once the cases are assigned to an adjuster, Citizens has no idea what is happening to the claim until the adjuster comes back with an amount of damages or the policyholder complains of inaction.

Since December, Citizens officials have told state officials that they largely have solved the problem by placing a small team of dedicated adjusters on payroll who can move forward once-stuck cases by flagging them for priority action.

The company also has created a customer-service center and has assigned representatives to handle each case that comes to its attention.

Citizens spokesman Justin Glover said the new system works.

He cited the case of a West Palm Beach condominium owner who had complained for months to Citizens. When the company investigated, it found the policyholder's adjuster had left Florida months ago.

Citizens has hired a new adjuster, Glover said.
So, all is well now, right? Not so fast. Remember, St. John's piece ran on Groundhog's Day:
Glover could not say, however, what happened to the other claims assigned to the departed adjuster. Nor could Glover address why the vendor didn't report its missing man because, aside from informal exchanges, Citizens leaves it to vendors to manage their own cases.

Some storm victims say Citizens' improvements have done little good.

Jeff Grady, president of the Florida Association of Insurance Agents, related the case of a Daytona Beach resident now on his fourth adjuster from Citizens "and still no money."

"One adjuster got the claim worked up, then was let go, then the next was with a company that was fired, then, most recently, a guy comes out only to say he now has been taken off the job," Grady said.

"It's all for various reasons, but the end product to the customer is, he hasn't even gotten his claim run up the pole to see if Citizens will pay."
According to St. John, "One of Citizens' major problems appears to be that there is no tracking system for claims, so the system relies on complaint calls from unhappy policyholders to prompt intervention. ... It will be different in 2005, Citizens' officials said."

But, remember, this was a Groundhog Day report. According to St. John, Citizens has identified a Texas claims adjusting company, Universal Risk, as one of the worst.
Records show almost all of Universal Risk's work came from Hurricane Ivan. By the end of December, the adjusting firm still had more than 300 open Ivan claims and almost as many complaint calls to the Department of Financial Services.... the vendor had the highest complaint rate of any company working for Citizens, although records show other contract adjusters with poor records.

Even so, Citizens cannot say how many claims it took away from Universal Risk or any other company. Again, Citizens cannot trace reassigned claims back to their problem adjusters, excepting by pulling case files, one at a time.
Got that? Citizens "took away" the claims from Universal but "cannot say how many claims it took away."

Groundhog Day, indeed.

One small bit was added to Paige St. John's front-page piece for locals in Pensacola:
Pensacola attorney Charles Beall Jr. said more than half his potential client calls involve Citizens Property Insurance, though the carrier has only 10 percent of claims in the region.

"I think the answer for Citizens is about to come in the form of lawsuits," Beall said.
While we're looking for answers, let's ask another question: Is state CEO Tom Gallagher, who oversees the debacle known as Citizens Property Insurance, incompetent or wilfully blind to the state insurance company's defalcations? In Gallagher's case, the answer is likely to come at the polls the next time he runs for office.

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