From The Associated Press:
Florida Gov. Rick Scott - and other top state officials - quickly distanced themselves last month from a controversial deal approved by Citizens Property Insurance Corp. to shift thousands of homeowner policies to a start-up insurance company.
But emails show that the Scott administration and other officials knew in advance about the unique deal that calls for Citizens, the state-backed insurance giant, to pay $52 million to Heritage Property Insurance and Casualty to absorb 60,000 policies.
Documents obtained by The Associated Press show that a lobbyist representing Heritage had met with a top Scott aide to discuss the transaction. The Scott administration acknowledged that the meeting happened in late March - roughly two months before the Citizens board approved the deal.
Scott's chief of staff Adam Hollingsworth insisted in a statement that no one in the Scott administration took a position before Citizens approved the transaction, known as a "take-out," on May 22.
"Our office does not weigh in for or against any Citizens take-out action. Instead, we expect the experts at Citizens and the Office of Insurance Regulation to act in the best interest of Citizens policyholders and the taxpayers that support the company," Hollingsworth stated.
Other state officials - including Chief Financial Officer Jeff Atwater - were also given information about the deal before the vote. Citizens officials sent an email to Atwater's personal email account the week before that included background material on the transaction.
Atwater, in the wake of news reports questioning the arrangement, talked to a top Citizens official hours before the transaction was approved. A spokeswoman for Atwater's office did not respond to questions about his role.
Citizens also sent material to House and Senate staff, although a Citizens spokesman said that emails to the House were apparently never received.
Citizens does not normally pay companies to absorb its policies although the board did approve a similar transaction earlier the year. Instead, Heritage is being paid to assume any claims associated with policies going back to January. But since Heritage gets to pick the policies it wants, the insurer could cherry-pick policyholders who have no claims pending.
Citizens officials have defended the deal as a way to shrink the size of the state-created insurer. Citizens currently has nearly 1.28 million policyholders. There has been a push to shrink the insurer because of fears that it would not be able to cover claims if a huge hurricane hits the state. Citizens has the power to place a surcharge, also called a "hurricane tax," on its own policies and policies of most insurance policies if it can't cover its losses.