Michael Moline, Author at Florida Politics - Page 2 of 42

Michael Moline

Michael Moline is a former assistant managing editor of The National Law Journal and managing editor of the San Francisco Daily Journal. Previously, he reported on politics and the courts in Tallahassee for United Press International. He is a graduate of Florida State University, where he served as editor of the Florida Flambeau. His family’s roots in Jackson County date back many generations.

Senators eagerly waiting hard facts on how the power grid stood up to Irma

Will Hurricane Irma inspire the Legislature to light a fire under the Public Service Commission’s (PSC) efforts to buttress the electric grid against powerful storms?

Likely. But it’s too soon to know what changes might help.

That picture emerged during hearings before Tuesday before the Senate Committee on Communications, Energy, and Public Utilities: Regulators won’t have digested the data situation in time for opening day in January.

Chairman Aaron Bean put the question directly to Cayce Hinton, the PSC’s director for industry development and market analysis, during a presentation on that agency’s 10-year infrastructure “hardening” efforts.

“How did we do? Cut to the chase. Did it turn out? Did we get our money’s worth?”

The PSC has opened a docket to look into that very question, Hinton replied. This year marked the first time the improvements were really put to the test, he said.

“So we don’t know yet?” Bean said.

“We don’t know yet.”

“From what I’ve seen, there appears to have been some improvement as far as restoration times,” Hinton said. “The utilities, right now they’re the ones who have the stats.”

Representatives of three investor-owned utilities were on hand to brief the committee — Duke Energy Florida, Florida Power & Light, and Tampa Electric Co. Each reported that his company’s response was vigorous, considering the extent of the damage.

Bryan Olnick, VP for distribution operations for Florida Power, for example, said it took 18 days to restore power to all customers following Wilma, but only 10 after Irma. Half the company’s customers saw power restored within one day post-Irma; it took five following Wilma.

More information here.

Following the hearing, Bean said some senators are eager to improve the grid.

“Session’s just around the corner. If we need to move or act, we need to do it sooner than later,” he said.

And if the PSC can’t make recommendations in time?

“I’m going to gently nudge them.”

Senate begins search for consensus on AOB reform

Assignment of benefits reform was among the first topics tackled by the Senate Banking & Insurance Committee Tuesday as it began preparing for the 2018 Legislative Session.

A panel of interested parties, invited to debate points of contention, appeared to agree that so-called AOB agreements ought to be in writing, and that a deadline should be imposed for delivering them to insurance carriers.

Working out the details could be tricky, however, not least over which parties could sign AOB contracts. The policyholder, certainly. But what if a divorcing couple holds the policy jointly? Should mortgage-holders have a say?

“That’s why we’re doing this rather methodically — putting the issues out, giving everybody their time,” committee chairwoman Anitere Flores said following the hearing. “There is more that the sides agree on than they disagree on. So let’s try to get something passing.”

The House Insurance & Banking Committee used the same approach during the 2017 Legislative Session, and produced a bill that cleared the floor. The Senate’s AOB legislation never came before the full chamber.

Flores said she asked committee staff to review legislation proposed during the past three years to narrow the major bones of contention.

“And then maybe at some point … we’ll have a nice menu of issues the committee agrees on, and then we can have a bill,” she said. “It’s obviously going to take us several weeks. But we’d rather do it right and take our time than just rush and hear Bill X or Bill Y.”

Regarding sign-offs on AOB, Orlando trial attorney Lee Jacobson complained some carriers already are submitting agreements to mortgage lenders — without authority under state law, he asserted.

Angel Conlin, head of legal affairs and compliance for American Strategic Insurance, said that assertion is being tested in a case before the 2nd District Court of Appeal. She argued the practice is justified.

“The mortgage company is my insured,” Conlin said. “If the divorced couple, if they’re both listed on my policy, they both have rights under my contract and I have duties to both. If I were to pay only one person, because only one of my insureds signed an assignment of benefits, I have failed in my obligations to everyone that I had that contract with.”

The Office of Insurance Regulation has projected policyholders can expect rate increases of around 10 percent in each of the next five years, largely because of inflated costs due to AOB.

Personnel note: James Kotas exiting FCCI for role with Darden restaurant chain

James Kotas is leaving FCCI Insurance Group to lobby for Darden Concepts Inc., a national restaurant chain with brands that include The Capital Grille, LongHorn Steakhouse, and Olive Garden.

He becomes a manager of state and local government relations for 23 eastern states. The department will comprise three employees, including Kotas’ counterpart on the West Coast.

“It was a job opportunity that was too hard to turn down,” Kotas said.

The new job begins next week. Kotas plans to move to Tampa initially, but eventually to Orlando, where Darden is headquartered.

“You’re dealing with a lot of complex issues,” Kotas said.

“You’ve got labor laws. Because of all the locations, you’ve got to deal with real estate. You deal with licensing for alcohol, food and beverage. You’ve got state, federal and you’ve got local ordinances to deal with. Tax implications.”

Kotas joined FCCI about 3 1/2 years ago, as a government relations specialist.

Earlier, Kotas was chief of staff to Sen. Aaron Bean and Rep. Dana Young when she served in House leadership.

Citizens Insurance faces $1.2 billion in Irma claims; total insurance hit is $3.7 billion

Citizens Property Insurance Corp. faces $1.2 billion in losses following Hurricane Irma, Board of Governors chair Christopher Gardner reported Wednesday.

“Please recognize that this is an early estimate, and this number will probably change,” Gardner told board members during a telephone conference call.

The Florida Office of Insurance Regulation, meanwhile, reported 577,918 claims against all insurers as of Tuesday evening, involving residential, commercial, flood, and additional lines. Some 12.6 percent of those claims had been closed.

The estimated value of all claims was near $3.7 billion.

Citizens had fielded 45,651 claims as of Tuesday evening, Gardner said. Fifty-six percent came from the “Tri-County” region — Miami-Dade, Broward, and Palm Beach Counties.

The number of claims could rise to 70,000 during the next 18 to 24 months, he said.

The Florida Keys, where Citizens controls 60 percent of the wind-damage insurance market, represented 15 percent of the claims filed thus far.

Citizens has moved 100 adjusters into Key West. Additional adjusters have been stationed in Key Largo, Florida City, Naples, North Miami Beach, Marathon, and Big Pine Key.

The company has issued $836,000 in cash advances to more than 1,200 policyholders to date.

“We believe our resources are adequate, and all vendors responded effectively, providing in excess of 800 adjusters” statewide, Gardner said.

The Florida CAT fund will cover $193 million of the company’s losses. Gardner estimated Citizens’ reserves after losses $6.4 billion, plus reinsurance coverage.

“Even after Hurricane Irma, Citizens’ capital position is strong,” he said.

However, “given the magnitude of reported losses, we are sure to encounter unforeseen challenges,” Gardner said.

Irma-related claims now over $2 billion

Insurance claims from Hurricane Irma now have surpassed $2 billion, the Office of Insurance Regulation announced Tuesday.

As of 4 p.m. Monday, 372,281 claims represented $2,168,674,31 in dollar losses.

A little more than 6 percent of those claims have been closed already. Insurers rejected another 8,300. You can drill down into the data here.

The additional data were sufficient to push Clay County into the second-highest tier for claims — between 5,001 and 10,000.

The top tier — 10,001 and up — comprised a crescent of South Florida counties ranging from Lee to Palm Beach (excepting Monroe, which remained in tier two).

Also in the top tier were Central Florida counties extending from Polk and Osceola to Lake and Volusia, plus Duval County.

Citizens Property Insurance Corp., Florida’s state-backed insurer of last resort, reported 32,000 claims as of Tuesday morning, but could not provide a dollar value.

State: Insurance losses post-Irma near $2 billion

State regulators have received notice of more than 335,000 insurance claims since Hurricane Irma hit Florida, mostly concentrated in Central and South Florida, with losses nearing $2 billion.

The bottom line as of 4 p.m. Sunday was 335,347 claims, according to the Office of Insurance Regulation. Total estimated insurance losses were $1,954,947,889.

The data were based on claims information provided by insurers, and the office had yet to audit or verify the figures.

Thirteen counties accounted for more than 10,000 claims each. They included Broward, Collier, Lee, Miami-Dade, and Palm Beach. Monroe County, although hard hit, posted between 5,001 and 10,000 claims.

In Central Florida, the bulk of the claims came from Brevard, Lake, Orange, Osceola, Polk, Seminole, and Volusia counties. Highlands, Hillsborough, and Pinellas counties reported between 5,001 and 10,000 claims.

In North Florida, Duval County also reported more than 10,000 claims.

Meanwhile, Citizens Property Insurance Corp. said it had received 27,970 claims as of 9 a.m. Monday.

Statewide, insurers had already paid off 9,420 claims involving residential, commercial, private flood, business interruption, and other lines, the insurance office said.

Fred Karlinsky predicts insurers will turn to international sources for Irma payouts

You probably don’t have to worry about your insurance company’s ability to pay claims arising from Hurricane Irma.

Do worry about a shortage of adjusters to help them calculate your losses. That could inflate the cost of managing claims.

Fred Karlinsky, co-chairman of the insurance regulatory and transactions practice at Greenberg Traurig, said Florida insurers can draw on robust reserves and an international reinsurance market to pay claims.

“The losses are not borne just in Florida. They’re borne in Bermuda; they’re borne in London,” Karlinsky said during an interview in Tallahassee Friday. “Those insurers retrocede reinsurance out to other people. It really is worldwide support for the state of Florida.”

On the other hand, there’s an adjuster deficit — despite the Department of Financial Services’ efforts to streamline the licensure process. “That’s just the graying workforce,” Karlinsky said.

“What we have here — no pun intended — is the perfect storm,” he said.

“You have a storm that hit Texas, in Harvey. And you have an already-stressed system in the lack of adjusters. Then you have a storm in Florida, and you see a bidding war for these adjusters. So the expenses for adjusters have gone up significantly. That, in and of itself, creates a problem for the insurance marketplace.”

Karlinsky surveyed that market one week after Irma made landfall in Florida.

As bad as the storm was, it easily could have been much worse.

“Fortunately, Irma’s path took it to the west, so it didn’t go right up the spine of the state. The physical damage was not nearly what it could have been as a category 4 coming on land in some of the more populous areas,” Karlinsky said.

“If the worst-case scenario would have happened last week, it would have been a challenging event for the marketplace and for the state,” he said. “But I can tell you, on the whole, the state fared much better than anyone had hoped. We caught some lucky breaks and we dodged a bullet.”

Florida’s insurance market has changed dramatically since Hurricane Andrew in 1992. National insurers — unwilling to weather the storm-vulnerable state’s high risk to their shareholders and other policyholders — largely have left Florida to domestic insurers.

But those in-state companies appear healthy. Insurers that might have held reserves of $10 million 10 years ago now have “$50 million, $75 million, $100 million, $200 million in surplus,” Karlinsky said.

The Moody’s rating service on Sept. 11 declared that Citizens Property Insurance Corp., Florida’s insurer of last resort, appeared prepared to weather a big hurricane. The company and the Florida Hurricane Catastrophe Fund — a state-supported reinsurance pool — “effectively saved for a rainy day,” Karlinsky said.

“The CAT fund has in excess of $17 billion. Citizens has $13.3 billion. Part of that is cash on hand; part of that is reinsurance. The bottom line is, those entities have a significant amount of cash available. So I am hopeful they won’t have to go down the pay-me-later route of assessing people for Irma losses.”

Florida’s integration into a global insurance pool has a downside in a dangerous world — trouble elsewhere could consume reinsurance resources.

“If you have a power plant that goes down in Turkey, that affects pricing in Florida. When you have a situation in Russia that is covered with insurance, that could affect pricing in Florida. It’s all correlated. It just goes to show you the world is a much smaller place,” Karlinsky said.

“When you have an extinction event for companies is when their reinsurance towers get blown away — when worldwide marketplace support is basically finished,” he said.

Still, “my sense is that either all or almost all of the companies’ losses will be within their retention or within their reinsurance towers,” he continued.

“That’s what they model for. That’s what these companies are built to survive for. They’re not built necessarily to survive multiple large storms, multiple Cat 5s. In fact, there almost isn’t enough surplus out there in the marketplace to help rebuild a direct hit to downtown Miami, that goes though Tampa, that comes up through other parts of the state. That could be a very significant effect — not only for Florida but for the United States and worldwide markets.”

Ultimately, insurance is a guessing game.

“Hope for the best, but prepare for the worst. That means to build houses up to code or better. Florida has the strongest building code in the nation. Florida is the best-equipped state to handle these types of events. Having said that, there’s a reason they’re called disasters, and there is no playbook for something like we’ve gone through here.”

Citizens Insurance reports 8,000 claims and rising as policyholders return home

Some 8,000 Irma-related insurance claims have landed with Citizens Property Insurance Corp. — and counting.

That was the number as of 9 a.m. Wednesday, company spokesman Michael Peltier said.

Florida’s Office of Insurance Regulation was tallying claims filed but had not yet posted the numbers on its website.

Citizens, established by the Legislature as the state’s insurer of last resort, is invested in Florida’s most disaster-prone areas — including coastal areas that suffered most during Hurricane Irma.

Citizens estimated total claims might reach 125,000 — but the figure was “very, very preliminary,” Peltier stressed.

“It changes by the day as we get information about the storm’s track,” he said. He was unable to attach a dollar amount to Citizens’ exposure. “It’s probably going to be a few days.”

In a Credit Outlook (subscription required) posted Monday, the Moody’s rating service said Citizens appears well able to cover its obligations. Moody’s pointed to reserves of $13.3 billion — $2.5 billion more than the company’s estimated losses for a storm like Irma.

Those reserves include $7.4 billion in surplus, plus reinsurance and coverage from the Florida Hurricane Catastrophe Fund. Additionally, the company can assess policyholders if necessary to meet its obligations.

“We’re in a full-tilt response to the storm, planning out where we’re going to send our mobile recovery centers,” Peltier said.

The company expects the number of claims reported through its call centers “to pick up significantly during the next few days as people get back to their homes,” he added.

Rick Scott blocks insurance premium hikes, cancellations during Irma recovery

Gov. Rick Scott has ordered a three-month freeze on insurance rate increases for homeowners struggling to recover from Hurricane Irma — plus a three-month grace period for policyholders who received non-renewal or cancellation notices just before the storm hit.

“Due to the devastating effects of Hurricane Irma, Floridians should be focused on getting back to their normal lives without their insurance premiums being increased,” Scott said in a written statement.

Additionally, Scott directed that insurers grant policyholders 90 days to document losses.

“Many Floridians were displaced during this dangerous storm, and providing additional time to submit information to insurance companies gives them needed flexibility,” Scott said.

The governor issued his directive to the Office of Insurance Regulation. He cited his authority under Executive Order 17-235, the emergency declaration he signed on Sept. 4 as Irma approached.

On Aug. 23, the insurance office conducted a public hearing into a proposed 10 percent premium increase for about half of Citizens Property Insurance Corp.’s 453,000 policyholders — mostly affecting those in Miami-Dade, Broward, and Palm Beach counties. The state’s insurer of last resort cited a 100 percent increase in the average cost of water claims in the Tri-County region.

“Hurricane Irma was a storm unlike anything we have seen before, and as residents across the state travel home to assess damages to their homes and businesses, we stand ready to help with any insurance issues that arise,” Chief Financial Officer Jimmy Patronis, whose office oversees the insurance regulators, said.

“Insurance can be complicated, and I’ll do everything in my power to protect policyholders throughout the entire recovery process,” Patronis said. ”Our team of insurance experts are standing by to take Floridians’ calls at 1-877-693-5236.”

The governor’s office directed policyholders to an Irma resources webpage, www.myfloridacfo.com, and to additional storm-related materials on the insurance office’s webpage here.

Legislature adjourns sometimes-bumpy Special Session in a burst of amity

The Legislature concluded its special session with about an hour and 20 minutes to spare Friday, after voting to improve funding for public schools, colleges, and universities, and revamping the way the state encourages economic growth.

While they were at it, the lawmakers passed an implementing bill for the medical marijuana constitutional amendment the voters approved last year.

House Speaker Richard Corcoran and Senate President Joe Negron gaveled their chambers into adjournment at around 4:40 p.m. — well in advance of their 6 p.m. deadline. Clashing priorities at times had seemed to threaten a timely sine die.

“This is a very good day for Florida families,” Gov. Rick Scott said during a joint post-adjournment news conference with Corcoran and Negron in the Fourth Floor rotunda.

Scott had called the special session because he was unhappy with the state budget for schools and economic development the Legislature sent him last month.

On Friday, he credited Corcoran for coming up with the idea of helping to finance repairs to the Herbert Hoover Dike, around Lake Okeechobee, and Negron for pressing for the boost to higher education.

“I’m excited to travel the state and brag about what got accomplished in the special session,” Scott said.

Negron viewed the dike project as in keeping with SB 10, his big Lake Okeechobee and Everglades restoration project, approved during the regular session. He promised additional attention to the matter during the next regular session.

As for higher education, “our universities and our state colleges are an integral part of economic development and vitality in the state of Florida,” Negron said.

“If you put them all together — the special session and the regular session — it’s a landmark year,” Corcoran said.

He welcomed the increased investment in schools and the new economic development model that stresses broad infrastructure and training investments rather than grants to particular businesses.

“It looks like one of the first infrastructure projects might be repairing the dike at Lake O. So that’s an exciting thing, too, that happened today,” Corcoran said.

In subsequent remarks to reporters, Scott zeroed in on the schools right off the bat.

“We had to put more money into K-12 education, and I want to thank the House and Senate for making that happen,” he said.

He and Corcoran had bickered over the future of Enterprise Florida and Visit Florida during the regular session. On Friday, he allowed that the speaker “made us think about how we can do economic development better.”

Scott wants the dike project completed by 2022, he said — and thanked President Donald Trump for promising federal money for the project. He said the state money would allow the work to get started.

Does Scott plan to sign the medical marijuana implementing bill?

“Absolutely,” he said. He raised no objection to language reserving treatment center licenses for defunct citrus processing businesses.

He’s still reviewing HB 7069, the House’s Schools of Hope charter initiative from the regular session. Asked whether there was a deal linking that bill to his priorities during the special session, Scott said: “I’m still reviewing the bills.”

Of the higher ed projects the Senate held out for, Scott said: “I have reviewed those projects and I plan on approving them.”

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