Citizens Property Insurance Co. officials recently told agents meeting in Orlando that Florida’s insurer of last resort is “as ready as they are going to be,” to face the 2006 hurricane season.
Paul Palumbo, Citizens head actuary, appealed to independent agents to assist the company with the unprecedented challenge of taking over more than 300,000 property and casualty policies from Poe Financial Services and its subsidiaries.
According to Palumbo, Citizens has to accommodate 50,000 to 60,000 new property and casualty applications it receives per month. He said Citizens formerly received 20 commercial lines applications, but now receives an average of 250 per week.
Palumbo and Suzanne Murphy, Citizens vice president, weren’t on the Florida Association of Insurance Agent’s Conference and Expo schedule, but volunteered at the last minute to hold a briefing and answer questions.
Palumbo described the Citizens increase in applicants for policies as “exponential growth,” and upon making a fast check of his database, discovered 410 commercial lines applications had been received in early June.
According to Palumbo, properties valued at more than $10 million presented a special problem because they have to be rated and valued individually.
“We need you to share our story with your customers and provide them with the correct information,” Murphy said. “We are emphasizing partnering in which you, the agent, are the face and voice of Citizens.”
During a question and answer session, Palumbo and Murphy outlined new policies and appealed to agents to be patient and to follow proper procedures.
Palumbo described Citizens growth as “explosive,” saying it’s almost impossible to keep up with the volume. He said the company has done everything possible to streamline the system and craft a liquid program.
June estimates show property and casualty policies jumped to over 500,000. Palumbo predicted property and casualty and commercial policies would pass the one million mark by the end of 2006.
Officials said Citizens’ goal is to partner more with its more than 7,300 agents in Florida and communicate better with them to make obtaining policies and settling claims more streamlined.
Murphy and Palumbo outlined Citizens changes they hope will make their growth more manageable, including:
• Developing new claims tracking and software management to speed claims processing;
• Adding an agent-only hot line to make it possible for agents to obtain faster responses;
• Beefing up the catastrophe management team by adding 15 new employees;
• Hiring more than 140 former Poe employees to assist in transitioning their accounts over to Citizens;
• Using outside, licensed inspection firms to investigate claims; and
• Requiring its claims outsourcing provider to add new employees and streamline its operations.
Palumbo said Citizen’s goal is to be able to complete quotes in a timely manner, within five to seven days. He claimed Florida’s insurer of last resort has come “light years in improving its claims process.”
Several large carriers viewed Citizens new claims management system and were impressed with the fact it provided better capabilities than their systems offered.
Citizens main communications channel, according to Murphy, is email. She said it is the most efficient way to communicate, due to the large number of agents trying to call them.
The agents voiced concern about possible errors and omissions claims, after Citizens implemented a policy in January requiring 30 business days notice to approve a new contract. Agency representatives said carriers often waited until only a few days before a policy was about to lapse to notify them a policyholder was being cancelled, which meant the customer would be without insurance until Citizens completed its paperwork.
Palumbo vowed to change the system to provide the agencies with more leeway to provide their agents with timely quotes.