Volume 1, Number 47, November 22, 2004     
 

In a few days Floridians will gather with family and friends to celebrate Thanksgiving. This day of tradition in America gives us an opportunity to give thanks for all the benefits of this land of plenty, and of course, for our freedom.

But even with all the gifts and blessings of this year, for many Floridians this year was full of tragedy. Sadly, many Floridians will not celebrate Thanksgiving in their traditional way - in their own homes. That’s because thousands of homes remain in disrepair following the onslaught of four hurricanes.

Even so, we are still fortunate. Remember that if you will sit at a dinner table on Thursday with a friend or someone you love, you are blessed.

Remember also that the dedicated employees of the Department of Financial Services throughout the state continue working hard to help all Floridians get their lives back to normal. Patience, understanding and the support of family and friends will see us through these difficult times.

Here’s wishing you and yours a safe, happy and blessed Thanksgiving.
 

                        -- Tom Gallagher

DFS HURRICANE STATUS REPORT
 

HURRICANE MEDIATIONS
Mediation meetings have begun in Punta Gorda, Orlando, Jupiter and Pensacola to provide Floridians with a process to quickly and fairly settle disputes with insurance companies, at no cost to them.  To date, more than 1,000 homeowners have requested mediation.  Several dozen participated in mediation on the first day. 

Mediation was instituted following Hurricane Andrew with a nearly 90 percent success rate. 

Storm victims can learn more about mediation services by logging on to the department’s website at www.MyFloridaCFO.com and downloading the “Mediation Program” brochure.  Consumers can sign up for mediation by calling the state’s hurricane hotline at 1-800-22-STORM. 

MEDIATION SITE LOCATIONS 

ESTIMATED INSURED DAMAGES
 (Estimates based on data call through the Office of Insurance Regulation)

Hurricane Charley:      $7.5 Billion              
Hurricane Frances:     $4.5 Billion
Hurricane Ivan:            $4 Billion
Hurricane Jeanne:       $4 Billion

Total Insured Losses: $20 Billion

Number of claims filed to date: 1.4 million
Expected number of claims: 2 million. One in every five homes statewide damaged.

ACTIONS TAKEN TO HELP CONSUMERS

Instituted a moratorium on insurance companies canceling or non-renewing homeowners during hurricane season or because they have filed a storm claim.

Working with insurance companies and policyholders to resolve cases involving multiple deductibles.

Placed a 10 percent cap on what public adjusters can collect on a homeowner’s insurance claim and prohibited them from charging fees up front.

Required Florida’s health insurers and HMOs to waive restrictions on prescription refills to enable citizens to fill prescriptions in advance. 

Urged banks and credit unions to expedite loan applications, eliminate late fees on loans and waive ATM and check-cashing fees for storm victims.

Set firm deadlines for insurance companies to respond to policyholders and process claims.

Established mediation program to give storm victims a no-cost way to quickly and fairly resolve claim disputes with their insurance company.  

CONSUMER RESPONSE 
Since August 13, the day Hurricane Charley made landfall, the department has received more than 136,000 calls and handled more than 29,000 consumer requests for assistance.

After each storm, mobile response units were deployed to impacted areas and mobile command centers were up and running within 72 hours of landfall. 

More than 150 department employees have been in the field providing insurance help, with the assistance of 30 insurance experts from eight other states.

Department staff have assisted thousands of consumers in their communities, with a presence in more than 50 disaster recovery centers statewide.

There are as many as 40,000 adjusters working storm claims. Of this number, 16,100 emergency adjuster licenses were issued to expedite the payment of insurance claims.

ELEVEN INSURANCE COMPANIES SUBPOENAED

TALLAHASSEE-Investigative subpoenas were issued today to eleven insurance companies in Florida by state regulators and investigators. The subpoenas require insurance companies to submit records and documents related to their contractual relationships and commission arrangements.

“We need to determine if insurance companies and brokers are manipulating the law for financial gain rather than what is in the best interest of the insurance-buying public,” said Florida’s Chief Financial Officer Tom Gallagher, who oversees the Department of Financial Services. “We will certainly take immediate action if we uncover any evidence of bid-rigging, kickbacks or improper fees.”

Subpoenas were issued to: National Union Fire Insurance Co. of Pittsburgh, PA; American International Specialty Lines Insurance Co.; Continental Casualty Co.; Lexington Insurance Co.; Scottsdale Insurance Co.; Federal Insurance Co.; Ace American Insurance Co.; Zurich American Insurance Co.; St. Paul Fire & Marine Insurance Co.; State Farm Florida Insurance Co.; and Twin City Fire Insurance Co.

“The kinds of practices and problems recently uncovered elsewhere often increase the costs to businesses, and in the end, to consumers. We need to determine if that is the case here in Florida,” said Kevin McCarty, Commissioner of the Office of Insurance Regulation. “If it is taking place, we need to rectify the situation.”

Gallagher applauded the coordinated efforts of the Florida Department of Financial Services, the Office of Insurance Regulation and the Attorney General’s Office.

Today’s subpoenas stem from a legal task force Gallagher established last month to investigate whether any of the activities outlined in New York Attorney General Eliot Spitzer’s recent civil suit are taking place among insurance brokerages and companies in Florida. The suit alleges civil and criminal misconduct involving insurance brokers steering business to insurance companies for a commission.