Michael Moline
Citizens Property Insurance Corp. released documents Monday refuting arguments that it pays incentives to the company that reviews its repair estimates on water losses.
The documents include a letter from Lynx Services LLC’s North American manager, Ramon Suarez, refuting the charge.
“Lynx has found no invoice or evidence that Lynx receives any type of commission or cut of the difference between the contractor’s original estimate and the lower negotiated payment for its review of water mitigation invoices,” Suarez wrote.
“Although our contract with Citizens has a provision that allows for payments to Lynx based on flat fees and upon a percentage of the savings of the original invoice reviewed, the records reviewed indicate that Lynx has only been paid on a flat fee basis,” he continued.
Citizens provided a link to the documents.
The contract came up during Monday’s meeting of the Senate Banking and Insurance Committee, as the panel delayed a vote on Chairman Doug Broxson’s legislation (SB 122) restricting Florida’s one-way attorney fee in insurance litigation.
Supporters see the bill as a way to discourage litigation driven by assignment of benefits agreements, or AOBs.
In opposing the bill Sen. Annette Taddeo, a Miami Democrat, said she was “taken aback” by reports that Citizens gives “a cut” to Lynx for “going there and cutting the estimate.”
She referred to a trial attorney’s testimony last week that “Lynx receives a cut of the difference between the contractor’s original estimate and the lower negotiated payment.”
The presentation cited a 2016 story in the South Florida Sun-Sentinel reporting on the contract.
“It was important to respond quickly because these incorrect statements directly challenge the integrity of Citizens and our vendor,” Citizens President and CEO Barry Gilway said in a written statement.
“We will continue to provide stakeholders with accurate and timely data while protecting the confidentiality rights of our customers.”
Like Suarez, a Citizens news release conceded the contract allows percentage-based fees, but says “those services were never accessed.”
The release says Lynx follows the nationally recognized industry standard and that the contract provides for travel costs and fees paid on a quarter-hourly basis.
