is serious, but Citizens customers may be a little skeptical. After
all, this is the homeowners insurance provider that does not publish
its phone numbers for consumer calls, making its customers instead
call their agents.
policy is changing, and that's just the beginning.
week Gov. Charlie Crist signed an insurance law that makes
significant changes to Citizens' eligibility requirements. Those
changes are expected to add hundreds of thousands of policyholders
to the "insurer of last resort."
officials say the insurer was already in the midst of a
transformation into a very different company. But after a special
insurance session that focused a great deal on Citizens, the need to
change is taking on a new urgency.
revisions to the company's procedures include:
Allowing Citizens to compete with private insurers for the first
Eliminating the requirement that Citizens charge more than other
Removing the mandate that policyholders leave Citizens if another
insurance company wants to take them.
Allowing customers of private insurers to seek out Citizens if they
can get a reduction of 25 percent or more in rates.
Canceling two of the company's planned 2007 rate hikes.
Promises of rate decreases of between 5 percent and 10 percent.
executives expect that the new rules could push the company to as
many as 2 million policies by the end of 2007.
year, Citizens grew from about 800,000 policies to more than 1.3
million as other insurers abandoned or scaled back their property
insurance coverage in Florida.
that new business is going to take a lot of work — and a lot of
new employees. A new director of employee training, who will oversee
plans to increase staff training, started this month and is busy
getting up to speed.
Wallace, who took over as interim president of Citizens this month,
expects to hire 500 employees in the next year.
hires are on top of about 800 employees today, up from 250 a year
many people are being hired, in fact, that a book containing
pictures of new managers was passed out at Thursday's meeting in
acknowledged that adjusting to the changes will be a challenge but
said Citizens can handle the growth.
key to success will be putting infrastructure in place to support
it, Wallace said.
in the works are substantive changes aimed at improving employee
training, including a plan to increase company audits and
investigations if there are allegations of staff wrongdoing. The
provider also plans to better monitor agents.
by the thousands
with 8,300 insurance agents is a huge task on its own, said Joe
Bouthillier, Citizens' director of agency operations.
acknowledged that there have been significant issues with agents in
allows any agent in the state to sell its policies, as long as he
has a valid license and represents at least one other carrier.
comparison, State Farm, which is No. 2 in homeowners policies, has
fewer than 900 agents, and they sell primarily State Farm products.
the new rules, agents will be subject to more performance audits and
written tests to show they know proper policies and procedures,
Bouthillier said. Those who repeatedly give consumers wrong
information or are unable to show they understand Citizens'
underwriting rules and regulations will be fired.
the focus of Thursday's staff meeting was on customer service.
Consumer frustration can be alleviated, at least in part "by
giving great service,'' Douglas told about 100 managers.
is up to managers to ensure employees are sensitive to
policyholders, he said.
can be done even if a consumer is upset, he said. At one point, a
thank-you letter from a customer was held up as an example. It sang
the praises of a representative despite the fact that he had denied
intently was Steve Bitar, Citizens' newly named manager of consumer
services. His department will help consumers who are unable to get
satisfaction with their claims adjuster or agent, whether it be by
settling the claim or simply helping explain the terms of a policy.
lot of times within the insurance world there are a lot of language
and jargon and provisions that are very hard for the consumer to
understand," Bitar said. "So the customer-care
representative will work with the consumer to help them understand
it and make sure they're supported.''
already has more than 100 customer-care representatives, but Bitar's
customer-care unit will consist of a second layer of
representatives. They will step in and assist customers who aren't
satisfied with their initial representative or field adjuster.
doesn't have a staff running yet, and like a lot of things at
Citizens, his department is a work in progress. But he acknowledges
a need for change, and he's drawing from experience in his previous
job running Citizens' call center.
consumers calling for help were pushed back to their agent for
answers. But the answers weren't always forthcoming, and many
consumers ended up frustrated, Bitar said.
Citizens department starting from scratch in coming weeks is the
commercial department, which will carry out the provider's newly
expanded mission to insure more businesses.
also has put a new centralized purchasing department in place. It
was formed to ensure that goods and services are bid out for the
lowest price, something that didn't always happen in the past.
senior purchasing representative asked managers attending the
Jacksonville meeting Thursday to alert her to any personal
purchasing arrangements they have with vendors so she could see
whether they are subject to bidding regulations.
year ago, employees were permitted to have private purchasing
arrangements with vendors. It was not unusual for an employee to go
to a local appliance store to purchase television monitors.
days are over, Wallace said.
lawmakers mandated some of Citizens' more consumer-friendly changes.
The legislature last year mandated the creation of Bitar's consumer
new standards promise prompt and professional claims and customer
are a different company than we were 2 1/2 years ago,''
said Douglas, the 72-year-old investment adviser who serves as the
unpaid chairman of Citizens' board. "If people could see the
facts, then their attitudes would be so different.''
officials need to present the governor and other top officials
Tuesday with a plan of operations that shows customer service
Martinez, Citizens' director of outreach and education, said the
company can improve and that he wants to hear from consumers.
plans to hold public hearings once each quarter in different parts
of Florida to gather input.
are going to yell,'' Martinez said.
is OK with that because comments will help Citizens be more
responsive to consumers. The first hearing likely will be held in
South Florida in the next few months, he said.
there also is movement behind the scenes, including at the
catastrophe operations center.
will have a best-in-class response if there is a major hurricane,''
said Tim Loftin, Citizens' new senior vice president in charge of
claims. He left his job as claims manager for 12 Southern states at
Safeco, another insurance company, to build Citizens' claims
problems handling about 120,000 claims from the 2004 storms are not
hard to understand when you know what was happening in the
background, Loftin said from his office in the Jacksonville building
that will house the center.
had just two supervisors in place to deal with the 2004 storms. They
were, in turn, dealing with more than 1,000 outside adjusters.
conceded that 10,542 complaints in 2004 was a high number, as was
the 4,662 complaints filed after the 2005 storms. But he said the
2005 total also reflected a pool of claims that was about 50 percent
higher than in 2004.
Citizens increased the number of supervisors from two to eight, it
still was not enough, he said.
the troops have arrived.
has been beefed up to 52 supervisors in the catastrophe center, with
23 others expected to be hired by the time hurricane season is in
full gear, Loftin said.
75 supervisors work out of a large warehouse-type room with computer
monitors and new claims-adjusting software.
technology will enable adjusters to monitor the changing
of construction material after a storm to ensure Citizens provides
windstorm victims with enough to rebuild.
Further, Loftin said Citizens has contracts
with more than 2,000 outside adjusters and should be able to avert
past problems that left it with inadequate field personnel.
Citizens also is working on improving its
non-hurricane response, Loftin added.
Of 25,000 claims handled last year from Jan. 1
through October for fires, water pipe breaks and other damage, there
were only 266 complaints, Loftin said. That's less than 1 percent.
Citizens still ranks high compared with other big insurance