Insurance investigations as sought by Florida Representative Artiles have dropped in recent years

Dec 7, 2012

The following article was published in the Florida Current on December 7, 2012: 

Insurance investigations as sought by Artiles have dropped in recent years

By Gray Rohrer

In the past two weeks, Rep. Frank Artiles, R-Miami, has asked for “market conduct examinations” — thorough reviews of insurance companies’ business practices to ensure compliance with state laws — of state-run Citizens Property Insurance Corp. and the Tower Hill Insurance Group and related companies.

Insurance Commissioner Kevin McCarty wrote in a letter to Artiles that such reviews of Citizens are required by law and one is currently being conducted, due out in February. McCarty hasn’t yet responded to Artiles’ request for a review of Tower Hill, but if he does conduct a market conduct examination of Tower Hill, it will be a rare occurrence — the last such review of Tower Hill was done in 2004.

In fact, market conduct examinations of property and casualty insurance companies have become extremely rare in recent years. Between 2000 and 2007, OIR published 302 such reviews and issued 254 consent orders to companies, an average of more than 69 per year. Since 2008, the office has published 10 examinations and consent orders of property and casualty companies — including two examinations of Citizens mandated by state law — an average of two per year.

An OIR spokeswoman noted that the agency’s Market Conduct Investigations Unit has been doing examinations of other entities. Since 2007, the unit has published nearly 150 investigation reports of retirement communities and life and health insurance companies. The office has also recovered nearly $99 million for consumers over the course of the 2010-2011 and 2011-2012 fiscal years.

Yet OIR staffers did not respond this week to emails asking for an explanation in the drop off in the examinations of property and casualty insurers.

Artiles said he’s looking for more transparency and accountability from Citizens, but he’s also looking to prevent the state-run insurer from implementing a $350 million loan incentive program to get private companies to take out Citizens policies. Tower Hill is the company that first floated the idea to Citizens.

“I think the biggest concern that I have is the executives who are actually running Citizens are keeping the board (blind) — including the chairman as well as the president — so the left hand doesn’t know what the right hand is doing. And in my opinion, Citizens at this moment in time has a lot of daily business issues such as claims, transparency issues and not giving the information to legislators and more people who are requesting public records requests in an efficient and timely manner,” Artiles said.

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