The Post…at any cost!

In an understandable attempt to close a painful chapter of ethical missteps, The Palm Beach Post editorial titled “Too much hot air in inflated homeowners market assessment”, gets it wrong….again.


Barely a breath from its misrepresentations on Citizens international travel expenses the Post attempts a little misdirection.

The only Florida-headquartered property insurance company earning an “A” or better from Jupiter-based Weiss Ratings is the government-run, taxpayer-backed Citizens Property…”.

Which is why policyholders “…are significantly more likely to wind up with a shaky, untested insurer that can’t be relied upon to pay a claim–or even stay in business–after a big storm.


In a polite and technically proficient rebuttal, Joe Petrelli, President of Demotech, warns the Post to stop its “scare tactics.” A well reasoned piece addressed to those who often abandon reason on insurance matters.

From where I sit the Post intentionally chose Weiss while it knew, or should’ve known, of the material shortcomings in its approach.

I’ve spoken to many insurance company CEO’s regarding Weiss and its ratings. I’ve spoken with government officials, including some at the OIR who, for obvious reasons, wish to remain anonymous. And, I’ve spoken with industry insiders of every ilk.

The consensus seems to be that Weiss is a bit of a “joke”. A word I don’t use lightly but which came up several times without any suggestion from me.

Figure this. Weiss doesn’t only rank Citizens the highest rated homeowner’s company in Florida. If you go to its website, Citizens has a rating of A+ which is the same as only 5 (that’s right only “five”) other “large” writers IN THE ENTIRE COUNTRY!

How can any rating agency imply superiority to a statutorily created entity with material percentages of surplus gained via the confiscation of funds from those it doesn’t even insure? And which is backed by even more taxation on its own policyholders who can be forced to leave or permitted to stay based on factors entirely beyond its control?

The truth is Weiss’s approach, that of spread sheeting public data into letter grades, is testament to the charge that it doesn’t even know who Citizens is, not really. It just appeared on a list of entities submitting data to state regulators.

As for the Post; why was the opinion of an insurance commissioner from one of the best funded and most professional insurance regulatory agencies in the US summarily dismissed as wrong? Why did the Post ignore data from Demotech and AM Best when both use criteria acceptable to the NAIC, the OIR and to virtually every Florida financial institution?

The Post editors also resort to a little historical misdirection.

And the brand-name, more established national companies still haven’t come back in the water.”

Technically correct. But…it ignores Charlie Crist having hammered “the last nail into the coffin of the insurance industry”. He slammed the door on those nationals and filled the void with his own approach. An investor based approach emphasizing reinsurance instead of surplus.

Guess what. Weiss ignores reinsurance–which can account for as much as 60% of the premium! By relying exclusively on Weiss, the Post paints itself with the same brush…a “joke”.

Also, and just as bad, the Post colors State Farm’s diminishing policy count as “Exhibit A”. Characterizing it first as subterfuge to mask some unknown end and second, as proof of a weak Florida market.


One simple phone call and the Post would’ve learned that desperate State Farm agents are losing customers by the barrel–not due to cancellations but due to cheaper policies being found elsewhere; and, not with Citizens.

That’s consistent with the OIR message of things getting better and nothing like the Post’s implications.

The Post was right about one thing. Eight companies have gone under since the 04/05 storm seasons. But…it was the result of Charlie Crist’s HB-1A in 2007.

Since Governor Scott’s reforms have taken hold only one carrier has failed and for totally unrelated reasons.  

And …rates are going down!

To me, and to a growing number of those I speak with, this episode reveals a deeper problem at the Post. Deeper than just shoddy journalism.

Beneath the surface, between the lines, lurks a decidedly pro-Crist agenda.

An agenda it apparently intends to promote even at the cost of its own reputation.


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