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Task Force on Citizens Property Insurance Claims Handling and Resolution

News Article

Citizens reaches out - to 100 at a time

St. Petersburg Times

Tom Zucco
Tom Zucco can be reached at zucco@sptimes.com or 727 893-8247.


The property insurer takes complaints and questions, but not many residents show up.

CLEARWATER - Maybe it was the thunderstorms. Or that word of the forum hadn't gotten out. Or, as one Citizens Property Insurance official guessed, maybe it was simply that most policyholders don't have any serious problems.

Citizens insures about 238,000 homes in the Tampa Bay area, including about 108,000 in Pinellas County. Yet only about 100 people came to the auditorium at Clearwater High School Monday evening to ask questions and have their policies reviewed by underwriters and executives from the state's largest property insurer.

In the second stop of a statewide tour to reach out to its more than 1.3-million policyholders, officials of state-run Citizens heard complaints that premiums have gone up and that the replacement values of homes were unfairly inflated.

Citizens president Scott Wallace answered that the company's rates are now competitive with the private market and that the rates have been frozen until January 2009. As for replacement values, officials said those can often be adjusted depending on how much risk the homeowner wants to take on.

Many of the complaints were directed not at Citizens, but at the insurance agents who write Citizens policies. To save money, Citizens has no agents of its own. Instead, the company uses nearly 8,000 agents statewide to write policies. Those agents receive a commission ranging from 6.9 to 8.6 percent for homeowners and about 12 percent for commercial policies.

It's that disconnect between Citizens and the agents that is causing problems.

"I went to three insurance agents to get a Citizens quote and got three different rates," said Bob Cummins of Madeira Beach. "We can't get straight answers from the agents."

Paul Palumbo, Citizens vice president of underwriting, explained that Citizens recently began an aggressive agent training program that should bring more consistency to rate quotes.

"You have the option to take a deductible of 2, 5 or 10 percent," Palumbo said. "And you should get mitigation credits for the type of roof you have or for buying shutters.

"The bottom line is that if you don't get the answers you need, call us. Or find another agent."