The state’s largest private property insurance company has been violating state law, mistreating customers and shifting profits to affiliates for years, according to an order released Thursday by the Office of Insurance Regulation.
Universal Property and Casualty Insurance Company has been fined $1.3 million for a laundry list of violations ranging from mismanaging its money to wrongfully denying insurance claims to failing to maintain appropriate records. Many of the violations are repeat offenses for the company, since regulators flagged the much of the misconduct in 2005.
The fine, if it holds, would be one of the largest ever levied against a property insurer.
Fort Lauderdale-based Universal has more than 542,000 policyholders, and is 15 times as large as it was in 2004. During that rapid growth span, regulators say, it built up a habit of breaking insurance rules and using questionable financial practices. Universal officials did not respond to requests for comment Thursday.
The company was blasted last year by the Insurance Consumer Advocate, Robin Westcott, for it’s practice of “post claim underwriting.” After homeowners filed insurance claims, the company scrutinizes the initial policyholder application, to see if any mistakes had been made. If the homeowner failed to report a credit issue on the initial application, Universal denies the claim and cancels the policy.
“This practice is reprehensible and should cease immediately,” said Westcott last month, urging the Office of Insurance Regulation to investigate.
OIR found that Universal was indeed cancelling policies after policyholders made claims, leaving homeowners who thought they had insurance with huge repair bills and no coverage.
"For far too long, this company unjustly denied claims and forced consumers into financially devastating situations," said Chief Financial Officer Jeff Atwater, in a statement.
The company also made several other violations, cited in the 19-page OIR order (which is subject to challenge by Universal before it becomes final). They include:
-- Canceling policies without justification (a “repeat violation” from a 2005 order)
-- Requiring homeowners to produce multiple “notarized proof of loss” documents after making a claim.
-- Not keeping a copy of consumer complaints, as required by regulators and Florida statutes
-- Several money-management issues, some of which are detailed below.
When Gov. Rick Scott attended Miami-Dade County's annual hurricane preparedness news conference Thursday, he wouldn't say whether he planned to return a recent campaign contribution he received from an upstart company poised to reap a $52 million windfall from Citizens Property Insurance Corp.
Heritage Property and Casualty Insurance Company of St. Petersburg contributed $110,000 to Scott's reelection campaign in March. Last week, the board of Citizens, the state's largest property insurer, voted to ink a special deal in which Citizens will pay Heritage some $52 million to take over about 60,000 Citizens policies.
"What I've said is anything the Citizens board does, they need to take the time to review every project they do, make sure it's good for all Citizens policyholders and do the right thing," Scott said Thursday.
Pressed for an answer on whether he would return the contribution, the Republican governor did not answer. He left the conference after taking a total of three questions.
Later, Scott spokeswoman Melissa Sellers followed up with an email to a Miami Herald reporter answering the question.
"No," Sellers wrote. "And as we said last week, any assertion that our office influenced the Heritage risk transfer decision by the Citizens Board is outrageous."
Floridians for Immigration Enforcement, never big Marco Rubio fans, announced they've put up a billboard near Ocala along I-75 that bashes the Republican Senator for backing an immigration-reform bill that would allow "33 MILLION FOREIGN WORKERS in the next 10 years!"
Immigration-reform supporters say the immigration, especially high-skilled labor, would actually improve the economy.
Meantime, a group of pro-reform pastors, the Evangelical Immigration Table, is putting up a rival billboard near Rubio's office in Jacksonville that reads: "PRAYING FOR IMMIGRANTS. PRAYING FOR CONGRESS." It's also announcing a radio campaign.
On the other side, Californians for Population Stabilization is running spots on Florida TV taking Rubio to task.
Immigrant-bashing "hate" group attacking Rubio: Build fence that "stings people," let "illegals" live "in the shadows."
Ever hear of the group, Californians for Population Stabilization, which is running Florida ads attacking Florida Republican Sen. Marco Rubio for backing immigration reform?
Immigrant-rights groups sure have.
"This is a hate group that thinks undocumented children spread disease and filth. Hardliners? They are xenophobic at best," said Kathy Bird Caicedo, with the Florida Immigrant Coalition.
Her evidence: A YouTube video showing ads from CAPS and an interview with its chair, Marilyn DeYoung, who suggests that illegal immigrants aren't screened for whether they're "Communists, drug smugglers," felons or members of Al Qaida.
She also talks about "even the Venezuelans" -- something that wouldn't play well, say, in Doral, home to the United States' largest Venezuelan exile community and homebase of the influential Spanish-language network Univision.
CAPS also gets all environmental, pointing out in one ad that "immigrants produce four times the carbon emissions in the U.S. than they do in their home countries."
"Oh I'm called a racist all the time," DeYoung says in one clip. "That's because they think we dislike them, we dislike illegal immigrants. Well, in a way we do."
"We need to close our borders -- a fence, electric wiring that stings people that they can't get through and they can't clip," she said. "We're not saying they have to be deported by ICE. Let them live in the United States as illegals in the shadows until they decide to go home."
Folks in Brevard County tell us that the hardline group Californians for Population Stablization has begun running at least one of three 30-second spots attacking Florida Sen. Marco Rubio for his help in drafting the Senate's immigration-reform bill.
The spot that's running now, seen on NBC, savages the immigration bill for flooding Florida with workers at a time when joblessness still plagues the land. It's a potent message in the Space Coast for two reasons: It's a very conservative place and unemployment is among the highest in the state.
**Update: The Florida Immigrant Coalition and others call CAPS a "hate group." More here
While the Florida media buys likely aren't big, it's another sign that Rubio -- a 2016 White House hopeful and GOP frontrunner -- faces some conservative blowback in his own backyard for backing immigration reform. And his support for hard-core conservative positions (from voting against an iteration of the Violence Against Women Act to opposing Gulf oil-spill money because it was laden with pork) don't seem to matter as much as adopting a center-right position on immigration reform.
In a statement, Rubio's office disagrees that there's been much blowback because "he was very well received at all the recent GOP dinners he spoke at back in the state, and we continue to get good feedback from our conservative grassroots. There's been a handful of anti-immigration protests, but as your paper has noted, they've been poorly attended.
Rubio's not alone. His fellow Republican Senator from Arizona, Jeff Flake, is also targeted with ads that essentially swap out their names and states.
Note: The facts and figures the group uses are controversial and the subject of dispute. Case in point: The finding that the pathway to citizenship (which the ad calls "amnesty") would cost taxpayers $6.3 trillion, according to the Heritage Foundation. That's over 50 years (the ad doesn't note that) and the figure has been bashed as incomplete (and the study had a major PR problem as well). For instance, Harvard Medical School reported today that, from 2002-09, immigrants generated surpluses of $115 billion in the Medicare program while the native-born population generated a deficit of $28 billion.
Here are the spots with the text
Fired Florida state trooper Charles Swindle says he was using "discretion." His ex-bosses say his trumped-up citations against two legislators were acts of misconduct that cost him his job.
Swindle got his day in court Wednesday at a hearing before the Public Employees Relations Commission that attracted more news media representatives than actual participants. That in all likelihood was more a reflection of the post-session news doldrums in Tallahassee than the significance of the case itself.
"This is about Mr. Swindle issuing false citations," said Sandra Coulter, an attorney for the Department of Highway Safety and Motor Vehicles, in her opening statement in a cramped hearing room. "He's a law enforcement officer who has falsified formal documents."
Swindle's actions in the breakdown lane of I-10 in Madison last Nov. 19 cost him his job. In the space of a half hour, he stopped two motorists -- both of them legislators headed to Tallahassee to be sworn in to office. Both times, Swindle said the lawmakers were racing at 87 miles per hour in a 70 mph zone (what are the odds?) In both cases, he decided not to write speeding tickets; instead, he cited Reps. Charles McBurney, R-Jacksonville, and Mike Clelland, D-Lake Mary, for not having proof of car insurance, though both men did have the proof. Clelland also was cited for not displaying his registration.
Hearing officer Gregg Morton watched as the state played in-cruiser video and audio of Swindle's traffic stops. "There's no way I was going 87," McBurney could be heard telling the trooper, who told the lawmaker he was "cutting you a break" with a warning for speeding and a $10 fine for no proof of car insurance, which McBurney paid, before writing a scathing letter to the FHP that criticized Swindle's behavior, setting in motion his March firing.
Swindle's attorney, Sidney Matthew, argued that a long-standing unwritten policy at the Florida Highway Patrol discourages troopers from ticketing legislators, but Coulter countered: "I haven't seen a copy of that policy." Swindle, testifying under oath, said his superiors at the FHP reinforced the policy, but when pressed, the only person he cited who gave him such advice was a former trooper, Bill Grubbs. "Cut them breaks when you can," Swindle recalled Grubbs telling him.
Neither McBurney nor Clelland was called as a witness, as neither side in the case demanded either man's testimony. Swindle is seeking reinstatement to the Florida Highway Patrol with back pay. Matthew endured a series of procedural setbacks, as the hearing officer refused to allow Leon County Sheriff Larry Campbell to be called as a witness.
Campbell said he was ready to testify under oath that he was stopped several times by troopers, only to be sent on his way without a fine. But in speaking with reporters outside the hearing room, Campbell said he had never heard of a trooper concocting a no-proof-of-insurance violation. "I don't think that's the right thing to do," Campbell said.
In a bizarre moment, state Rep. Clovis Watson Jr., D-Gainesville -- one of several lawmakers ticketed by troopers in the past year -- showed up to testify, only to be told that he was excused and that his testimony wasn't necessary. Lawyers for the House and Senate successfully quashed Matthew's subpoenas seeking testimony from nine other ticketed lawmakers.
-- Steve Bousquet
Gov. Rick Scott wasted no time signing a bill to reform Citizens Property Insurance Corp., which has seen a whirlwind of criticism since it approved a special $52 million deal for an upstart company with ties to top politicians last week.
Scott signed SB 1770 on Wednesday, one day after the reform proposal reached his desk. The bill creates a “clearinghouse” to direct policies out of Citizens and into the private market, and includes several reforms that address controversies and scandals that have taken place at Citizens.
In a sharply worded missive, Scott focused mainly on those scandals, using words like “outrageous,” “egregious,” and “fraud, waste and abuse.”
The bill creates an Inspector General at Citizens, something Scott has called for ever since media reports documented the company’s missteps, which include: lavish travel expenses for executives, huge salary hikes, large severance packages for disgraced employees, overpriced contracts, mishandled investigations and the abrupt dismissal of corporate investigators who uncovered some of the misconduct.
“This new Inspector General will be accountable to the Cabinet and will not be an entity Citizens can fire, as they did with their old compliance officers,” Scott said in a statement. “A strong Inspector General is needed to provide independent oversight at Citizens and to end the fraud, waste, and abuse which has plagued Citizens for too long.”
Scott also called on Citizens to change its policies after a controversial deal worth up to $52 million deal for Heritage Property and Casualty Company, which is looking to take over 60,000 policies from the state-run insurer. Critics have blasted the quickly-approved deal for the nine-month-old St. Petersburg company, which contributed $110,000 to Scott’s reelection campaign in March. Scott said the board should require at least seven days notice before any future board meetings, in accordance with state agency guidelines. The Heritage deal was unveiled on a Friday, and voted out on the following Wednesday in a 3-2 vote. Several board members complained that there was not enough time to vet the proposal, a concern echoed by House Speaker Will Weatherford and Chief Financial Officer Jeff Atwater.
Citizens has stood by the Heritage deal, saying that it was thoroughly vetted for several weeks and would significantly reduce the company’s liability, which is backed by the state’s consumers.
"The financials associated with this deal are significantly in our favor," Citizens President Barry Gilway said Wednesday.
Note to politicians who keep citing a federal pre-sequester estimate that up to 70,000 Head Start children could be cut: the feds now say that won't be the number at this time.
PolitiFact Florida recently fact-checked a claim by U.S. Rep. Kathy Castor, D-Tampa, that "70,000 three-year-olds and four-year-olds across America will lose access to the preschool Head Start classroom" including 2,000 in Florida. We rated that Half True.
PolitiFact Virginia also fact-checked a similar claim by U.S. Sen. Mark Warner.
U.S. Department of Human Services spokesman Kenneth Wolfe told PolitiFact Florida today that the Office of Head Start has reached out to all the Head Start grantees to ask how they are achieving the 5 percent cut and expects to release the answer around late June. The programs have to get the go-ahead from the federal Office of Head Start to cut slots.
The 70,000 figure was what the White House used based on a 5 percent cut to the $8 billion program that serves about one million children.
"If every single grantee and program did nothing but absorb the 5 percent reduction in slots that's where the 70,000 number would happen," Wolfe said.
But many if not most programs are finding ways other than cutting slots to reduce their costs -- such as reducing staff or school days.
"It won't be 70,000 slots reduced," Wolfe said.
After years of fielding complaints that its annual Jefferson-Jackson Dinner was interminably long, the Florida Democratic Party had a solution: Make it shorter by having fewer speakers.
Now it has a new complaint: It's blocking former state Senate Democratic leader Nan Rich, a gubernatorial candidate, from speaking.
"I think it's inappropriate, given the amount of attention the governor's race will draw," said Rich, a Weston resident. "I've been a candidate for a year, I've traveled the state and built a significant infrastructure and grassroots support. And I'm just asking for five minutes."
But it's five minutes too long in the eyes of the Democratic Party's chairwoman, Allison Tant, who decided along with party leaders to keep the June 15 fundraiser at the Westin Diplomat in Hollywood limited to three speakers: Congresswoman and Democratic National Committee Chairwoman Debbie Wasserman Schultz, U.S. Sen. Bill Nelson and featured speaker Julian Castro, the mayor of San Antonio.
"The decision for our JJ program was to have a streamlined event where we have a national speaker. And this year we’re excited to have Julian who spoke at the 2012 Democratic National Committee,” said Christian Ulvert, the state party’s political director.
“In years past, we’ve heard from the attendees that the program goes too long," he said. "We want a shorter program."
Party leaders are adamant: No extra time for Rich or anyone. Letting Rich speak, they say, would lead other Democrats to want to do the same. And that would weigh down the program.
"The program does not feature any candidates," Ulvert said. "This year we have a state convention a more candidate focused event. She’ll have great opportunity to showcase her candidacy and share her message."
Rich learned of the decision last week when she called Tant and was denied a speaking slot. Soon, the liberal Florida Squeeze blog, which opposed Tant for Democratic chair, began complaining about the treatment of Rich.
Rich said she understands the decision to limit the length of the program. She said she remembers one year in which now-Vice President Joe Biden had to wait until about midnight to speak and no one was there.
"It was embarrassing," she said.
But she's not asking for much, Rich siad. And she points out that the governor's race is different from other campaigns; so there should be special consideration.
Republican Gov. Rick Scott is widely disliked and seen as beatable, although he'll be well-funded. Still, Rich isn't the only Democratic candidate. Unknowns Ryan Adam Lipner and Jessica Lana Stewart have filed. Neither has raised any money
Rich's campaign has raised about $121,000 and spent about $26,000 and her political committee has raised an additional $136,000 and spent about $62,000.
By contrast, Scott is ready to spend as much as $100 million by November 2014.
Rich's relatively weak fundraising has Democrats casting about for another candidate. Some are trying to recruit Sen. Nelson, but the Democrat isn't inclined to leave the seat he just retained in Washington. Former Gov. Charlie Crist is expected to announce sometime this summer. But the Republican-turned-independent-turned Democrat isn't trusted by many grassroots Democrats.
"They want a true Democrat," Rich said. "They want someone who has consistent core values and principles. They don't see that in Charlie Crist."
But beyond the grassroots, Crist enjoys a major advantage. He has statewide name-identification, he's well-liked by President Obama's Florida team, and he'd be an instant frontrunner who has the best chance of beating Scott, most polls show. Like Castro, Crist spoke at the DNC.
Rich said she'll have the money and the organization to beat Crist. But she also would like a shot to make her case at the Jefferson-Jackson Dinner. She said she'll still attend, but she doesn't like the new rules.
"This runs contrary to the spirit of the Jefferson-Jackson Dinner," Rich said.