Complaints swamp home insurer

A surge of consumer complaints about Poe Financial, South Florida's second-largest home insurer, prompts a meeting with state regulators.

Miami Herald
April 21, 2006

A sudden surge in complaints about Poe Financial Group's ability to resolve claims from Hurricane Wilma will get increased attention at a meeting with state regulators today.

In the past two weeks, 169 new complaints were filed against Poe's three insurance companies, Atlantic Preferred, Florida Preferred and Southern Family Insurance.

The three insurers -- which together cover the second-largest number of homes in South Florida -- had already racked up 3,045 complaints through April 5 related to Wilma, which smacked the region last October.

That's more than any other insurer operating in Florida, including Citizens Property Insurance, the state-run insurer that is the largest insurer of homes in Florida with more than 829,000 policies.

The complaints include issues with policy coverage, claims adjusters and settlements.

In January, the three Poe companies had nearly 1,500 open complaints filed by policyholders throughout the state. That number had dwindled to a little more than 300 by early March under the close supervision of state regulators.

Top officials with the Division of Consumer Services, part of the state's Department of Financial Services, have been holding weekly discussions with Poe executives to gauge how it is handling claims. These discussions are intense and very detailed, said Bob Lotane, a spokesman for the Department of Financial Services.

Regulators look at the claims individually and often set guidelines and timetables for the company to resolve them. Regulators also demand follow-up details on claims they've reviewed.

Last month, Poe Financial began to curtail its underwriting activities.

First, Southern Family Insurance, which covers many condominium associations throughout the state, stopped writing new policies and said it wouldn't renew existing policies.

At that time, Atlantic Preferred and Florida Preferred said it would stop writing new business. Earlier this month, Atlantic Preferred said it would also stop renewing policies beginning in July.

Poe Financial's three companies insure 206,000 homes from Monroe to Palm Beach counties. Statewide, Poe has 316,000 policies. But once all the cancellations are complete, Poe will carry just 145,000 policies in the state through Florida Preferred.

Atlantic Preferred had been aggressively growing its business by taking policies out of Citizens' pool. Between 2003 and 2005, Atlantic Preferred took 114,169 policies from Citizens, including 14,002 windstorm policies that are the riskiest because they cover homes and condos in coastal areas.

Company officials did not return a call from The Miami Herald for comment.

According to its 2005 financial statement filed with the state, Poe's three insurance companies paid out $2 billion in hurricane claims in 2004-2005, which led to a combined loss of more than $300 million. However, those losses may climb because not all 2005 claims have been resolved, the company acknowledged in the filing.

This report was supplemented with information from Miami Herald wire services.

Copyright © 2006 by The Miami Herald

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