The Florida cabinet dealt state-run Citizens Property Insurance another blow today by rejecting its proposed plan of operation. The Financial Services Commission, or the FSC, which is made up of the Governor and the Cabinet, told Citizens Insurance that it’s time to go back to the drawing board.

The insurer says it’s doing the best it can with what it’s got, but Florida’s insurance crisis is complicated. And the repercussions of the mess left behind by the insurance companies that withdrew homeowner coverage after two busy hurricane seasons are bigger than anyone can imagine.


Citizens Insurance public information manager Rocky Scott


A bleak forecast indeed. Throw into that mix a Republican governor and cabinet, and an attorney general who wants to call the governor’s mansion home next year, and many say the latest move to reign in Citizens Insurance is a well-timed political stunt.


Florida Consumer Action Network’s Bill Newton is a representative for the National Association of Insurance Commissioners and sits on the board of the Coalition against Insurance Fraud.


Attorney General Charlie Crist sits on the Florida cabinet and therefore on the FSC. He initiated the motion to NOT approve the operations plan presented by Citizens. As Citizens has been criticized for its huge running costs and what some say is poor management, Crist’s move to require more specific plans from the insurer would appear to be a good move for the people of Florida.

But Crist’s gubernatorial opponent’s campaign say this move seven weeks before the general election is politically motivated. Jim Davis’s Communications director Josh Earnest


When asked if this was a political move, Charlie Crist told reporters, quote, It’s just the right thing to do. I’m doing my job.�

The FSC rejected the latest plan from Citizens insurance because it says it failed to be specific in how it will serve Floridians. What the FSC took particular objection to was the hiring of private attorneys by the insurer to sue the state when it was asked to reduce or rollback rates.

FCAN’s Bill Newton


Over the past two years since it was established, Citizens’ Insurance has experience tremendous growth as more and more property insurers back out of the state after heavy losses due to unusually active hurricane seasons. Citizens takes between 55-thousand and 60-thousand new policies a month.

Citizens’ Rocky Scott says people will continue to live by the coast and they will need insurance. Something has to be figured out.


Citizens will now run under a provisional plan set out by the FSC. It is required to hold public hearings on the subject and submit a permanent plan by January 31st, 2007.

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