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State’s New Insurer of Last Resort Takes over Today

8/1/2002

TALLAHASSEE - Florida Treasurer and Insurance Commissioner Tom Gallagher announced that Citizens Property Insurance Corporation (Citizens) takes over today as the state's insurer of last resort for consumers unable to obtain property insurance coverage from the private market.

Citizens, which was created through legislation approved during the 2002 session, is the new entity resulting from the merger of the Florida Windstorm Underwriting Association (FWUA), which provided wind-only coverage to nearly 410,000 coastal residents, with the Florida Residential Property and Casualty Joint Underwriting Association (FRPCJUA), which covered approximately 110,000 consumers in need of residential or commercial property coverage. The FRPCJUA was created after Hurricane Andrew for homeowners who could not secure coverage from private insurance companies.

"I commend staff from both the FWUA and the FRPCJUA for making the implementation of Citizens a reality," Gallagher said. "Consumers will not only see savings achieved under Citizens, they will have access to better coverage and service."

At Citizens' first Board of Governors meeting, held today in Ft. Lauderdale, Gallagher announced his selection of members to serve on the Technical Advisory Group. Required by the new law to be appointed by Gallagher, the Technical Advisory Group will provide input and assistance to Citizens' seven-member Board of Governors. Members of the Citizens Board of Governors were appointed by Gallagher in June. A list of all appointees is attached.

Gallagher also announced at the board meeting that Jay Newman, former executive director of the FRPCJUA, will serve as the new Executive Director for Citizens. Newman, who joined the FRPCJUA in 1995, has more than 26 years of insurance experience.

Gallagher pushed for the creation of Citizens to achieve tax savings and to enhance consumers' access to comprehensive coverage. "Citizens is structured to be a tax-exempt entity, resulting in tax savings of up to $100 million annually," Gallagher said. "These savings will help shore up reserves to pay claims." Citizens also has the ability to issue tax-free bonds in the event a catastrophic storm makes landfall in Florida, Gallagher added.

The legislation creating Citizens (Senate Bill 1418), sponsored by Senator Rudy Garcia (Miami-Dade) and Representative Jeff Atwater (Palm Beach), also provided rate relief last month to FWUA customers by placing a 10 percent rate cap on the 40 percent rate increase that was scheduled to take effect July 1.

For more information, consumers can contact the Citizens helpline at (888) 685-1555 or visit www.citizensfla.com . A list of new appointees for Citizens' Board of Governors and Technical Advisory Group are listed below.

Citizens' Board of Governors

William O'Neil, Chairman, Sarasota County

G. Bruce Douglas, Duval County

Marcos R. Marchena, Orange County

Jeff A. Cross, Broward County

Jay Odom, Okaloosa County

Gloria Fletcher, Alachua County

Edward London, Miami-Dade County



Citizens' Technical Advisory Group

Bob Ricker, Chairman

John Palmquist

Anita Byer, Setnor & Byer Insurance and Risk, Plantation

Will Messer, Rogers Atkins Gunter & Associates Insurance, Tallahassee

M. Stephen Jackman, Ft. Lauderdale

Frederick M. Straus, Allstate Alternate, Northbrook, IL

James C. Santos, First Floridian Insurance, Tampa

Bruce A. Baker, Lon Worth Crow Insurance Group, Miami

R. Thomas Savage, Jr., Qualsure Insurance Corporation, Sarasota

John Kaiser, Insurance by Kaiser, Inc., Key Largo

James "Skip" F. Boylan, LUTCF, Southern Farm Bureau Life Insurance, Margate

Robert E. Hoyland, USAA

Stephen A. Korducki, Florida Select Insurance Company, Sarasota

Thomas S. Krzesinski, POE Financial Group, Inc., Tampa

Craig Bissel, Aon Reinsurance

Commissioner Tony Masilotti, Palm Beach County Commissioner, West Palm Beach

Amy Padgett, American Strategic Insurance Corp., Apollo Beach

Russ Smith, USAA, Tampa

James Horton, State Farm Insurance, Winter Haven

William T. Sanders, DeSoto Insurance Corporation, Tallahassee

Gary Kettles, Clarendon Insurance Group

Rick Hardy, Florida Family