Monday June 24, 2013
Family Bonds Make Up the Foundation Sustaining Florida’s Industry
I recently had the pleasure of attending the 80th birthday of Bankers Insurance Company founder Bob Menke. I marveled at those in attendance who “grew up” with the Florida insurance industry. So much of Florida’s industry talent spawned from Bankers Insurance Company and to this day they continue to work on innovative initiatives and encourage the younger generation to stay active in the industry. One of those in attendance and paying heartfelt tribute to Bob on behalf of herself and his other grandchildren was his granddaughter, Mary Katherine Strong. Below was Mary Katherine’s tribute describing what an amazing influence Bob has had on her life and the lives of so many other family members and admirers:
I am so excited to be here tonight on behalf of the grandchildren to wish Bob – Grampa – a happy birthday. As we have heard a lot tonight from current and former Bankers employees, my grandfather has been a great teacher and mentor. He has also been a great teacher and mentor to me, and to his 11 grandkids both as a formal teacher or unintentionally leading by example. Specifically, I’ve seen this growing up in a few ways.
First, grampa has always taught us to follow our passions. We see him and the way he follows his heart and is passionate about everything he does – whether it is building Bankers, the Florida Gators, his family, or other passions. He is a tireless worker and he leads by example in this way. At the same time, he has always encouraged us to pursue our passions and the things we care about the most – whether that is encouraging his youngest daughter Michelle to take a job at HSN that requires her to essentially be nocturnal and work overnight every night, or Alexandra loving horse-back riding so much that she brought her horse to college. Grampa has shown us and supported us to follow our passions.
Secondly, Grampa has shown us the importance of family. Growing up, I can remember the ski trips and the boat trips and at the time I don’t think we necessarily appreciated them – we thought this was something all families did together. As we get older, I think we all are starting to realize just how special those were and how much credit Grampa deserves for making them happen. He did so not because he just wanted to go skiing or fishing, but because he is 100% committed to his family and realizes the importance of strong family bonds, which he has undoubtedly helped us all to form. He has provided us with incredible both tangible and intangible family experiences, and taught us the importance of remaining committed to family despite and during extremely hectic schedules.
Grampa, thank you so much for teaching us so much, for being such a great grandfather, a great teacher, and a great mentor. We love you very much and hope that you have a very happy birthday.
CEO Rose Naff And Florida Health Choices In The Summertime Spotlight
In this our second installment of LMA’s Summertime Series we are extremely excited to spotlight guest author and Florida Health Choices Corporation CEO, Rose M. Naff. Established in 2008 by the Florida Legislature, Florida Health Choices (FHC) was created from the desire to increase access to affordable, quality health care by creating a competitive marketplace for purchasing health insurance and health services by employers. In 2009 the FHC’s Board of Directors embarked on an executive search to find and appoint the corporation’s first Chief Executive Officer. Fortunately for Florida, one of the most accomplished and recognized leaders in helping frame state and national health care policy was not far away and the Board was extremely fortunate to be able to appoint Tallahassee resident Rose Naff as FHC’s first Chief Executive. Widely recognized as an accomplished leader and innovator, Naff developed a national reputation on health care policy, marketing and outreach campaigns geared towards the uninsured while serving 18 years as Executive Director of the Florida Healthy Kids Corporation. Many times while Executive Director she received state and national recognition for her outstanding accomplishments. Because of her extensive knowledge and understanding of state and federal health care issues, we requested and Rose agreed to provide LMA and its readers with a three-part series providing Florida businesses with important information about federal health care reform. The following is her first installment.
Is Florida ready for health care reform?
While most attention is given to health care reform’s individual mandate, businesses, large and small, risk a very costly surprise if they assume they are not affected by health care reform or if they don’t take the time to study the requirements. Every business is affected – some more than others.
The opportunity for information gathering and decision-making is now, before the first open enrollment periods begin later this year. Savvy business owners will be fully informed before October 1, 2013, when the federal government launches an insurance exchange for individuals and businesses in Florida. A business can prepare for this looming deadline by talking with a health insurance agent and tax advisor now. The business owner can also wait until the last minute, or simply do nothing and hope that there are no financial consequences. In business – hope is a poor substitute for planning.
To determine the best course of action, the business owner can start by asking the following questions:
1. Will my business miss out on the Small Business Tax Credit in 2014?
2. Could my business, large or small, be subject to health care penalties?
3. Are the health insurance rates I pay today likely to change and, if so, by how much?
In this three part series written exclusively for Lisa Miller & Associates, I will help you answer these questions.
Part One: Small Business Tax Credits
In Florida, it has been estimated that 71.6% or as many as 222,350 small businesses qualify for the Small Business Tax Credits. Even businesses that pay no taxes can qualify. In some cases, the value of the tax credit may actually exceed the cost of providing group coverage to employees.
If a business already qualified for the credit during a prior tax year and wants to continue to be eligible for it, it will need to purchase a new plan through the Small Business Health Options Program, or SHOP. Beginning with the 2014 tax year, the maximum tax credit will increase from 35% to 50% of employer premiums paid when that coverage is purchased through the SHOP. Qualified businesses that buy coverage elsewhere may be surprised to learn at tax time that the credit they were counting on has evaporated.
A small business owner who currently has, or intends to purchase group coverage, will want to know about the open enrollment period for small businesses. In the past, small groups had to meet varying employee participation requirements depending on the size of the business. The good news is a small business that cannot meet the required employee participation rate will still be able to purchase coverage, but with a limited window of opportunity. If the participation rate is likely to be less than 70%, the open enrollment period will be November 15 – December 15 each year. This open enrollment period applies to both the SHOP and private market insurance purchases. If a business misses this window to enroll in coverage, it may have to wait until the next small business open enrollment period the following year.
Businesses that can meet the participation requirements will be able to apply year round and won’t have to wait for open enrollment. (There are some exceptions when it comes to calculating a business’ participation rate and an insurance agent can help with this.) In some cases, a small business with an existing group plan may want to consider ending the current plan before its regular renewal date and applying during the small business open enrollment period in order to qualify for the tax credits.
To be eligible for Small Business Tax Credits, a business must have fewer than 25 full-time equivalent (FTE) employees and the average annual salary for all employees must be less than $50,000. (A FTE is one employee working 40 hours per week or two employees working 20 hours each week, etc.) The business must also contribute at least 50% of the insurance premiums for employees at the single (employee-only) coverage rate.
Small business owners, talk to your agent and/or tax advisor. Go to www.IRS.gov and www.healthcare.gov to learn more. The decisions or non-decisions you make now may have positive or negative tax consequences and your opportunity to remedy it may be a short window that occurs during the fall of 2013.
The Author, Rose Naff, currently serves as CEO of Florida Health Choices, Inc. and is building Florida’s first Health Insurance Marketplace. When launched later this year, the Marketplace will serve Florida’s small businesses that do not qualify for government subsidies. Go to www.myfloridachoices.org to learn more or to tryout the on-line calculator for small business.
Taking the Fight To AOB Abuses-We Must Continue To Be Vigilant
Those of us here at LMA, along with state insurance regulators and investigators continue our efforts to watch out for potential abuses in the use of Assignment of Benefits (AOB) forms and related documents in connection with property and casualty claims. Insurers, their adjusters and SIU Units are normally the first line of defense in detecting numerous types of unlawful insurance activity which ultimately harms policyholders. As many of you know, these activities have more recently included abusive practices involving AOBs and an upswing in unlicensed public adjusting by roofers, plumbers and water remediation firms. In recent months the Division of Insurance Fraud has made numerous arrests for unlicensed public adjusting and we owe our fraud fighting partners a debt of gratitude. We also know that the Fraud Division is extremely appreciative of the information and referrals frequently being made by company SIU offices across the state. In working with the Fraud Division to prepare for the recent Sunshine State Claims Conference it was recognized that a number of statutory provisions could possibly come in to play when addressing potential AOB abuses and unlicensed public adjusting. We strongly encourage that your company SIU team members and claims monitoring staff be exposed to these and when observed, make necessary reports to the Insurance Fraud Division. Many of the relevant statutes/issues to be mindful of are as follows:
*Potential Unlicensed Public Adjusting: Regardless of the validity of an AOB, the roofing, plumbing and remediation firms in some cases prepare and submit claim forms on behalf of the insured or claimant. They have also been detected negotiating claims or settlement terms with insurance company representatives. Such activity constitutes acting as a public adjuster under s. 626.854(1), F.S. People who engage in unlicensed public adjusting can be prosecuted under s. 626.8738, F.S.
*Contractors Prohibited From Adjusting Claims: Even if the repair firm holds a valid contractor’s license in Florida, a contractor or subcontractor cannot adjust insurance claims on behalf of an insured or claimant pursuant to s. 626.854(16), F.S.
*Remain Mindful Of Other Potential Fraud Possibilities:
1.Regardless of the existence of an AOB, potential unlicensed public adjusting or other concerns, if a company has reason to believe that a claim is inflated or otherwise fraudulent, an appropriate referral to DIF should be made.
2.Under Florida’s grand theft statute (s. 812.014), a prosecution could possibly occur when the following elements exist:
A. The claimant or insured says in a statement that the roofer, plumber or remediation firm was hired based upon their assertion that they would handle all of the insurance paperwork and deal with their insurer on their behalf.
B. The claimant or insured also says they were told that it would not cost them any extra money to engage the services noted in number 1 above.
C. The above statement regarding “no extra cost” turns out to be a material misrepresentation and the insured or claimant also states that had they known such information was false, they would have never hired the contractor/remediation firm or signed a contract.
3. When multiple claims/occurrences of the same activity are observed (unlicensed public adjusting, false, fraudulent or inflated claims, etc.) prosecution could well occur under Florida’s scheme to defraud statute (s. 817.034.
* An executed AOB may not be valid pursuant to s. 626.405 for the following reasons:
1. Water remediation firm staff, plumbers, roofers and other contractors acting as public adjusters without licensure in violation of Florida law. Courts in Florida have found underlying contracts invalid or unenforceable for the aforementioned reason.
2. No insurable interest at the time of loss
3. Partial assignment of benefits not allowed under statute
4. Third-parties (such as mortgage holder) no consulted with and/or granted approval
Accordingly, contract for assignment of benefits may be unenforceable. Granted, the above issues would likely be civil in nature, however, we recommend that companies and their attorneys continue their diligent work addressing these issues in the court system. We particularly recognize the tremendous success of Attorney Kimberly Salmon, Esq., with the Groelle and Salmon Law Firm, who on behalf of insurers has won numerous motions to dismiss suits brought by firms using AOBs and engaging in unlicensed public adjusting. In her cases, many of these “Work/repair authorization and AOB forms” have been ruled by the courts to constitute invalid contracts. Again, the industry, your representatives and our fraud partners with the state must continue to work hand in hand to confront these and other insurance fraud issues. Our policyholders want and truly deserve the fight we continue to wage to keep fraud in check and their insurance costs as reasonable as possible in exchange for the valuable service we provide.
Three Arrests Triggered By Fraud Division for Alleged Unlicensed Public Adjusting
On February 24, 2013, a severe thunderstorm with damaging winds and large hail moved through several neighborhoods in Northeastern Tallahassee. After the storm, the Department of Financial Services’ Division of Insurance Fraud/Tallahassee Field Office began receiving complaints regarding the activities of roofing companies in the area. In a sworn affidavit obtained by detectives, a homeowner stated on March 10, 2013, an employee of roofing company “Dr. Restoration” left his business card with a name of “David Bower” and a flyer on her front porch. She stated that later that day David Bower came back saying his company was providing new roofs for several homes in the area damaged by the hail storm and that Leon County had funds set aside for damages caused by hail storms. David Bower further explained that a claim would be set up and that the homeowner’s insurance, Tower Hill Insurance Company, will pay for the repairs and then Leon County would reimburse them. The homeowner also stated that Bower said he would represent her in dealing with the insurance company and she did not have to do anything further. Hearing this, she signed the Dr. Restoration “Agreement” Form which authorizes Dr. Restoration to discuss matters directly with the homeowner’s insurance company. David Bower was later identified as David Christopher Bowen. In another incident involving a nearby neighbor, Bowen told the homeowner that he would not have to worry about any hassles because Bowen would act as his representative working on his behalf with the insurance company. Warrants were obtained for Bowen, charging him with 2 counts of Acting as an Unlicensed Public Adjuster, in violation of Florida Statute 626.8738. He was arrested on June 14 and transported to the Leon County Jail. In a separate incident, two homeowners came forward to complain about the tactics employed by Richard Allen Wilbur, a salesman for AAA Roofmasters, Inc. These homeowners stated in an affidavit obtained by detectives that a man who identified himself as ‘Brick’ Wilbur made contact with them and asked permission to check their roofs for damages resulting from a recent hail storm. Wilbur indicated that he found damage and that the insurance company would cover it. He then presented the AAA Roofmaster’s ‘Agreement’ Forms. In one case, ‘Brick’ Wilbur told a homeowner that he was ‘college educated’ and it would ‘be in her best interest’ for him to take care of dealing with her insurance company because he was more ‘experienced’ to talk to them on her behalf. In both cases, Wilbur allegedly engaged in unlawful activities related to his actions in dealing with the homeowners and their insurance companies. Richard Allen Wilbur was located and arrested in Leon County on June 17, 2013. He was charged with 2 counts of Acting as an Unlicensed Public Adjuster, in violation of Florida Statute 626.8738. He was transported to the Leon County Jail. In two more instances related to “AAA”, a local homeowner said in a sworn affidavit she made contact with AAA Roofmasters, Inc. employee, Seneca Lee Seibert by phone, after seeing AAA’s yard signs placed throughout her neighborhood, advertising roof repairs. She stated Seneca Lee Seibert told her how he could represent her interests to her insurance company on her behalf. She also signed a Roofmasters “Agreement” Form and called her insurance company using his cell phone and got all the information he needed to deal with the insurance matters. The homeowner said she fully believed Seneca Lee Seibert was going to be her representative and negotiate with Tower Hill to effect a settlement in her claim. In a later conversation, Seneca Lee Seibert offered to inflate the claim by $6,000.00 and split it with her. At this point, she terminated her agreement with AAA Roofmasters and contacted the DFS. Another homeowner contacted Seneca Lee Seibert who came to the house and examined the roof and initially stated that he did not think there was enough damage to warrant a new roof. He encouraged her to call State Farm and file a claim anyway because he felt that he could negotiate with the insurance adjuster that there was indeed enough damage to warrant a new roof. After signing the Roofmasters, Inc. “Agreement” Form and with Seneca Lee Seibert present, he used his cell phone to dial State Farm regarding her claim. Prior to making the call, Seneca Lee Seibert wrote down “key words” and coached her on what to tell State Farm. The homeowner said she fully believed Seneca Lee Seibert wanted to act on her behalf and stated such in his initial interaction where he expressed that he would handle everything, including all the financial issues with State Farm. Ultimately, the homeowner elected to stop dealing with Seneca Lee Seibert because she thought his actions were suspicious. On June 19, Seneca Lee Seibert was located and arrested in Jacksonville, Florida. He was charged with two counts of Acting as an Unlicensed Public Adjuster, in violation of Florida Statute 626.8738. He was booked into Duval County Jail where bond of $10,000 was set.
From Us to You
At LMA, we are in full swing seeing many of you at conferences, legislative forums and town hall meetings. We continue to passionately tell all those who we address that the insurance industry teams in Florida are second to none.
Thank you for all you do every day – “see you” in a couple weeks! Lisa
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