Chris Gardner out as chair of Citizens Insurance board

Chris Gardner (left), chairman of the Citizens board with president Barry Gilway. (Image via Palm Beach Post)

Chris Gardner is out as chairman of Citizens Property Insurance Corp., Florida’s state-sponsored insurer of last resort, Chief Financial Officer Jimmy Patronis announced Wednesday.

Board member Gary Aubuchon will serve as interim chairman until Patronis names a permanent replacement.

In a statement, Patronis referred to Gardner’s “resignation,” although Gardner had made it known he was interested in remaining in the job. Citizens’ chairs serve at the pleasure of the chief financial officer.

The move comes at the peak of the hurricane season, which runs June 1-Nov. 30.

However, in a letter dated Aug. 13, Gardner told Patronis “I feel like the time has come to pass the gavel on to someone else, and bring by time as chairman to a close.”

Gardner is chief executive of HUB International Insurance in Orlando. Former CFO Jeff Atwater named him chairman in 2013.

Patronis had publicly asked Barry Gilway, Citizens’ chief operating officer, to find out which board members might be interested in stepping up. Among those interested in the job is lawyer and gambling lobbyist Marc Dunbar, who joined the board recently.

Patronis called Gardner “a tremendous asset to Citizens Property Insurance and Florida insurance consumers.”

“The work he and the board have done over the last several years helped change Citizens for the better. His skills and expertise, including understanding the concerns and bringing the perspective of insurance agents to the table, were invaluable. On behalf of all Floridians, I want to thank Chris for his service to our state, and leadership as chairman.”

Patronis said of Aubuchon: “Gary’s time on the board, and deep experience with insurance issues, makes him a great choice to take the helm.”

Additional candidates for the chair, according to Patronis’ office, include James Holton, president of The Holton Co.s; and Freddie Schinz, founder of the TIFORP Development Corp.

Gardner spent about two years on Citizens’ board before his elevation to chairman, and helped usher in profound changes at the company, including Gilway’s hiring in 2012. The chief executive brought many years’ experience running large insurance organizations.

In 2011, the company carried 1.4 million residential and commercial policies worth nearly $510.7 billion, according to company records. As of the end of June this year, that number was down to 443,000, valued at $112.7 billion.

Under state law, Citizens is required to pass along any losses incurred in exceeds of its reserves through assessments — above and beyond their premiums — first against its own policyholders and then to customers of private insurance companies.

To avoid that, Citizens undertook to reduce its exposure through a “depopulation” program, encouraging policyholders to seek coverage on the private market. Some 5,000 customers have switched thus far during 2018 alone, according to Office of Insurance Regulation data.

Additionally, Citizens has taken advantage of the reinsurance market to lessen its risk, turning to the Florida Hurricane Catastrophe Fund, traditional reinsurance providers, and the capital markets. In May, the board voted to shift another $1.42 billion to such third parties.

Garner noted in his letter that, when he joined, “Citizens was a very different company,” with 1.5 million policyholders and a one-in-100-year assessment risk of more than $11 billion, plus “high employee turnover, and total exposure of $500 billion.”

The company carried 23 percent of the residential market and 56 percent of the condominium and multi-family market. Today, its residential share is 5 percent and the commercial residential share is 11 percent. Additionally, Citizens has transferred more than $2.4 billion in premiums to the private market, Gardner wrote.