On Monday, Citizens Chairman Carlos
Lacasa called on the board to hold off on an expected
Oct. 19 vote and look more closely at the program, the
first of its kind, aimed at reducing the number of
Citizens policies, which now top 1.4 million.
Barry Gilway, Citizens' president and CEO, acknowledged the desire for additional information, but stood firm in his belief that the program will work as intended and represents the innovation needed to reduce the ranks at a reasonable cost.
According to his analysis, Gilway said the loan program will reduce Citizens maximum loss by $2 billion and save Florida insurance policyholders an estimated $1.7 billion in assessments during the 10 years in which the take-out companies would be required to hold the policies.
"Instead of trying to depopulate Citizens by coverage elimination, reductions and restrictions, which have not played well in the marketplace … this program, on the other hand, clearly benefits the policyholder," Gilway said.
Robin Westcott, Florida's insurance consumer advocate, applauded the board's decision to take a closer look.
"It is absolutely the right thing to do, simply because developing a program like this is a very complex endeavor," said Westcott. "Sometime when we are in the middle of doing that, it helps to have a third party to come in and take a look."
Citizens committee members said the additional review would be beneficial, but agreed to move forward quickly to have a plan in place in time for the 2013 hurricane season.
"We have a clock in this game," said committee member John Rollins. "Running out the clock is not a good policy for our team."