A judge agreed with my view posted in, Did Florida Mistakenly Place an Insurer Into Insolvency, Try to Disqualify the Law Firm That Pointed Out the Mistake and Harm 91,000 Policyholders By Quick and Unnecessary Non-Renewals?
The Florida Department of Financial Services and the Office of Insurance simply made a mess of Florida Specialty Insurance Company’s financial problems and cancellation of policies.
The court obviously was displeased with attorneys for the Department of Financial Services. The Department made false fillings which then lead to the court issuing the liquidation and policy cancellation. He said this never should have happened:
[Y]ou asked me to sign a consent order that said they consent they were insolvent. I don’t care which area of the law is, when a judge gets a consent order, that judge believes it’s an agreed order. Under any area of the law. I would never have signed it. It’s that simple.
the bottom is they don’t want to be defamed all over the world by saying they committed some criminal act.
I guess everybody makes mistakes. Putting an insurance company into a liquidation with wrong filings is a pretty big mistake.
The next questions remaining are the impact of actions that were undertaken during the liquidation that cannot be corrected. Some people had their policies cancelled and dumped into Citizens Property Insurance, which is not good public policy. Hopefully, somebody at the DFS did not stop pursuing the premium monies allegedly owed in the dispute with AIG/Lexington as well as the reinsurance claims monies owed under that policy.
Eventually, Florida Specialty Insurance Company may find itself in liquidation and those policies cancelled. However, it can certainly be a lot more orderly and in a manner where other private carriers rather than Citizens Property Insurance picks up many of those insurance customers.
I am certain that there are many dedicated and well-meaning employees at Florida’s Department of Financial Services and Office of Insurance Regulation. Sometimes, however, I wonder if we should have one Florida department of insurance rather than two entities running Florida’s insurance scheme.
We should also have an elected, rather than appointed, insurance commissioner in charge. This leadership change should be decided with a proposed constitutional amendment. Power to the people!
Thought For The Day
To err is human; to forgive, divine