Citizens president pushes plan to shrink state-backed insurer
Barry Gilway, president of Citizens Property Insurance Corp., continued to defend the beleaguered state-run insurer Thursday, while preparing to chart a path forward.
Speaking at the Florida Chamber of Commerce’s Annual Insurance Summit, Gilway defended the company’s employees and set out some ideas for improving--and shrinking--the state-run insurer in the coming year.
“One of the biggest surprises that I found when I joined Citizens is the quality of the staff,” said Gilway, who became president in June. “They don’t do it because they are the highest paid people in the marketplace.”
Gilway spent time praising the work of Citizens’ leaders in recent years and laying out plans for shrinking the size of the state-run company in the future.
He said that while some of the decisions made at Citizens have been “unpopular” and “controversial”—including reducing coverage and approving a generous $350 million loan program for private insurers—they will help improve the company.
“We tried to makes ourselves as unattractive as we possibly can,” he said, commenting on the company’s awkward business strategy.
Gov. Rick Scott has called on Citizens to significantly reduce its size and risk, leading to several unpopular changes for its policyholders. Premium hikes, coverage denials and unpopular reinspections are among the changes that have taken place this year alone.
Gilway indicated that more changes may be on the way to help shrink the insurer of 1.5 million.
The state-run insurer is considering a plan to offer policies to private insurers before they are accepted at Citizens and strengthen its “depopulation” program of shifting policies to the private market.
Continued price increases are also in store for Citizens policyholders.
“All of these programs are designed to do one thing,” Gilway said. “They are designed to make up for the one issue that we truly have to face, ultimately. And that is, we have rate inadequacy.”
Citizens rates statewide will go up by nearly 11 percent in 2013.
Gilway closed his speech by addressing the long list of corporate scandals that have been reported lately, including the firing of four corporate investigators who had uncovered misconduct at Citizens’ highest levels.
He said that most employees at the company are upstanding and that Citizens is working to fix internal problems that have recently come up.
“Are the things that need to be improved at Citizens? You bet there are,” he said. “And we are going to fix them.”
Gilway took a softer stance than he did earlier in the week, when he bashed the media coverage of the scandal as “preposterous” and “pathetic.”
“The last thing I want to do is incite the press anymore,” he said.