Killing Citizens

Trying to kill the beast is proving harder than expected.

Or is it an intentional suicide ?

The strange (but perhaps normal as Florida is governed)  purpose of eliminating a perfectly functioning publicly sponsored Insurance Company  is proving harder than expected.

All the tricky ways to induce or to plainly force home owners into unknown private insurance companies is meeting a mass resistance from many property owners.

I never understood why Citizens (which re-insures a good part of its policies) is supposedly incapable of doing a good job at insuring homes if we get hit by a major hurricane, while other smaller companies could do it safely and pay their claims with no risks to the insured. 

About 20 years ago I was in the business of importing merchandise and I suffered a 100% loss of a whole cargo that arrived at Miami Airport.  The goods had been insured by the sellers in a California insurance company.

Guess what!  

When I made my claim this insurance company was in bankruptcy. I didn’t get a penny.  Just to inform you that Insurance companies can also take you for a ride. 

Safer than Citizens?  No way I can believe that.  

Citizens proved in previous hurricanes that it can do a perfect job; it paid its claims; it didn’t raise sensibly its premiums.  

And how do we know that in a future, confronted with heavy losses when hit by a sizable windstorm, these new companies will not just abandon and walk out of Florida?  The largest insurance companies have done it in the past, everybody knows that.

But it is too late now to save the victim.  

Just read the article I found on FloridaRealtors.org on Sept. 30, 2015

Fewer owners ditching Citizens for private insurance

Customers in Florida's state-run and largest insurer are getting choosier.

Fewer than half are accepting offers to switch to private insurers this year, down from 70 percent a year ago at Citizens Property Insurance Corp., records disclosed at a meeting Tuesday show.

Though 1.2 million transfer offers have been approved by regulators this year, just 141,680 customers have actually switched, records show. That's a significant slowing from record departures in recent years that have seen the company downsize from 1.5 million customers to 585,000, including about 60,000 in Palm Beach County.

The changes come as the company phases out, for example, warnings in letters to customers about 45 percent storm taxes if they stick with Citizens. The Palm Beach Post probed how unlikely such assessments have become after a storm, and noted the letters fail to mention customers could be charged another kind of storm tax if they switch to private carriers who fail.

Private insurers have continued to use the bold-faced warning nearly half a year after Citizens said it would cease, although officials said it is on the way out for upcoming offers.

To be clear, private insurers have not been making all the offers allowed by regulators, sometimes because they covet the same customers or simply choose not to act. In June, for example, private insurers did not make any of their 45,500 approved offers.

Still, out of the about 300,000 offers companies made in 2015, 47 percent have been accepted, records show. The outcome from about 46,000 offers in September is not yet known.

The acceptance rate declined from 69 percent in January to as low as 35 percent in March. It averaged 70 percent in 2014.

Why? Some of it has to do with a shift in the mix of customers remaining in Citizens that has created "uncertainty" in the acceptance rate, said Barry Gilway, Citizens' chief executive.

"It's very hard to nail down what that the ultimate takeout rate is going to be," Gilway told the company's depopulation committee Tuesday, a day ahead of a meeting of the company's full board.

Many customers with standard home policies, often priced close to what private insurers want, have already left. That leaves a higher proportion of others like coastal, wind-only and mobile home residents who may find fewer offers close to Citizens prices.

State-approved transfer offers differ from ordinary marketing pitches because consumers are automatically switched if they do nothing.

Gov. Rick Scott vetoed a bill passed unanimously this spring that would have beefed up consumer protections on Citizens offers. 

That has not slowed calls for consumers to get clearer information about what private insurers intend to charge.  Citizens officials noted Tuesday they are working to see that an estimated premium appears in certain October letters related to the offers.

Citizens Insurance rate hikes full steam ahead.

Less than a week ago, I wrote about the hopeless fight of Florida Insurance Consumer Advocate against incoming rate hikes at Citizens. 

The State Regulatory Office not only approved but increased on the request of Citizens for certain policies. 

Against public hearing advice; against the public advocate's advice,

this is the type of decision that do not benefit middle class and the dream of home-ownership. 

And it's just the beginning.

Read what we read on the subject at FloridaRealtors.org

State regulators approve Citizens rate hikes

TALLAHASSEE, Fla. – Sept. 9, 2015

State-owned Citizens Property Insurance Corp. received approval for 2016 rate changes on Tuesday, with some tweaks to their original proposal that's expected to spread additional costs to policyholders in coastal areas.

The Florida Office of Insurance Regulation approved average rate changes equating to 1.8 percent on residential multi-peril accounts – an increase from the 1.3 percent requested by Citizens. The office also set an average 8.3 percent increase for residential wind-only policies; Citizens had asked for 9 percent.

"The office modified some of Citizens' recommended rates to address key issues cited as causes for increasing homeowners' insurance costs for policyholders in South Florida and on the coast," Citizens said in a release.

The new rates will vary by county and a property's location, home style and type of policy. There's a great chance policyholders in Southeast Florida will see a rate increase compared to homeowners in other parts of the state.

Even with the rate increases, Citizens expects overall rates to come down for about 60 percent of its policyholders. The order includes no changes for sinkhole coverage, though it increases rates on mobile home coverage.

The order, which came two weeks after a public hearing on Citizens' 2016 rate proposal, also advises Citizens not to pass the cost of reinsurance on to policyholders; instead, reinsurance should be treated as an expense, according to Citizens spokesman Michael Peltier. Reinsurance is effectively backup coverage for insurers if they're called up to cover large claims.

Florida insurance consumer advocate Sha'Ron James had earlier asked Insurance Commissioner Kevin McCarty to "strongly consider" the large amount of reinsurance purchased by Citizens before making any decision on the company's requested rate hike.

Citizens President and CEO Barry Gilway argued during last month's public hearing that a "disturbing" rise in water-damage claims in South Florida had driven the need for much of the proposed rate increases.

Citizens entered the six-month Atlantic storm season with a $7.5 billion surplus, the highest in its history, and $3.9 billion in reinsurance coverage from private, offshore firms.

The new rates go into effect Feb. 1.

Henry B. Nathan 

is a realtor at

United Realty Group Inc. 

Please call me for all your needs at

(800) 416-2747  -  (954) 296-6741

hbnathan@gmail.com

www.miami-new-construction.com

www.condo-southflorida.com

The Foreclosure Saga Goes On

Law firm warns of foreclosure ruling's effect

WEST PALM BEACH — The national law firm of Greenberg Traurig issued an alert this week warning its lawyers that a 4th District Court of Appeal ruling in favor of Palm Beach County homeowners could "dramatically change the foreclosure landscape in Florida."

The Sept. 7 decision in the case of Gary and Anita Glarum vs. LaSalle Bank says that an affidavit of indebtedness submitted by the bank was hearsay because the person who signed it did not have personal knowledge of the case. It reversed a 2010 Palm Beach County Circuit Court summary judgment that said the Glarums owed the bank $422,677.

"This decision could have broad, sweeping application in the lending and loan servicing industries and affect thousands of foreclosure cases, among other types of cases, currently pending in Florida courts," says the alert posted on Greenberg Traurig's website. The Orlando-based firm of Butler & Hosch represented LaSalle Bank in the case, but Greenberg Traurig also is a bank representative.

The amount the circuit court said the Glarums owed was based on an affidavit of indebtedness signed by loan servicer employee Ralph Orsini, who pulled the information from a company computer - a move that appeals court judges said amounts to hearsay. The court's ruling means the home can't go to foreclosure sale until the bank either gets another summary judgment or goes to trial. The plaintiffs have 15 days to file for a rehearing.

Ice Legal of Royal Palm Beach represents the Glarums, who have been in foreclosure since 2008 and continue to live in the home. Ice Legal founder Tom Ice said the alert is a "transparent attempt to influence" the court to change its ruling .

"Being denied a prohibited shortcut may cost the banks a little more, but given that they are the deep pockets here, pockets lined with our own taxpayer money, the ruling is hardly unfair or earth- shaking," he said.

Greenberg Traurig writes that the Glarum decision is the first case to specifically hold that an affidavit of a loan servicer relying on computer records is inadmissible hearsay because the affidavit was unable to identify who made the data entries, or how or when they were made.

"In the context of foreclosure matters, Glarum is especially concerning given the fact that the lending community uniformly relies upon computer data, including data from prior servicers, when drafting affidavits of indebtedness in support of summary judgment motions," the alert notes.

It says the appeals court sent a "strong statement" that "may have achieved the unintended result of dramatically changing the foreclosure landscape in Florida."

From the Palm Beach Post – Sept. 16, 2011

Henry B. Nathan is a Realtor at United Realty Group Inc.

Visit my websites:

Condo-southflorida.com

GoldenIsles-homes.com

Golden-Beach-Homes.com

The Beach Club Condo 

floride-immobilier.fr

33% RATE INCREASE IN PROPERTY INSURANCE?

Remember "Drop like a Rock"?

Our Governor, Charlie Crist promised, not so long ago, that Florida property taxes and insurances would get such a wonderful cut that real estate in our state would receive an incredible boost.

Now, whoever you think are your friends in Florida Congress, read the news, and read my comments below:

From The Sun Sentinel - March 25, 2010

Senate panel passes bill allowing major home insurance rate hikes

The Senate's insurance committee passed a bill Wednesday that would essentially allow home insurance rates to rise by a statewide average of up to 33 percent in the next three years. That means premiums in South Florida could rise by more than that. "Couple that with the 10 percent annual increase passed by this committee last week, and you have huge rate increases," said Bill Newton, executive director of the Florida Consumer Action Network who spoke in opposition to the bill along with Florida Insurance Consumer Advocate Sean Shaw. Gov. Charlie Crist also made an appearance to ask lawmakers not to vote for the bill.

The bill would essentially allow automatic average statewide rate hikes of up to 5 percent the first year, 10 percent the second year and 15 percent the third year. Policyholders' premiums can increase by more or less than the statewide average rate. Supporters say the bill is needed to strengthen Florida's property insurance market, draw more insurers to the state and improve companies' ability to pay claims if a major hurricane strikes. Opponents say rates already went up in South Florida after the 2004 and 2005 hurricanes and consumers can't afford additional increases. After heated debate, the committee passed the bill, SB 876, by a 6 to 4 vote. Voting for it were Minority Leader Al Lawson, D-Tallahassee and Senators J.D. Alexander, R-Lake Wales, Mike Bennett, R-Bradenton, Chris Smith, D-Fort Lauderdale, Jeremy Ring, D-Margate, and Garrett Richter, R-Naples. Voting against it were Senate President Pro Tempore Mike Fasano, R-New Port Richey and Senators Ronda Storms, R-Brandon, Alex Villalobos, R-Miami, and Joe Negron, R-Jupiter.

Newton said he's "disturbed" that all the Democrats on the committee voted for the bill and other insurance proposals. The House insurance committee passed its version of the bill, HB 447, last week. To weigh in on this bill or others, you can find your legislators on the state's Web site.

In all truth, our Governor is not the culprit.

Perhaps his Republican friends in Tallahassee?

Oops, not so fast: Have you noticed how many Democrats have also voted for this new attack on the beleaguered homeowner in this state?

Counties, Cities, and now the State: nobody seems to understand that we are living the most trouble times in many decades. Poverty in Florida is one of the worse in the whole US. Foreclosures, Jobless claims, Deficits, are our daily bread.

But our politicians do not quite understand the necessity of downsizing. Downsizing doesn't necessarily mean reducing essential services, like education and health. It means reducing the waste, reducing luxurious offices, parties, travel expenses, level and sub-levels of unnecessary and blown up bureaucracy. Things must change because we cannot afford our and "their" lifestyle anymore. As we are forced to adjust our expenses in face of the recession and economic necessities, so must our government change their spending habits.

In the same line of action, our government must take definite steps to rein in insurance companies. Their non-ending greediness must be contained, least one of these days some genius comes up with a reform , a "public option", a "single-payer-system" or something similar to the health reform that has shaken our political landscape, only that next time it could be applicable to property and auto insurance.

Insurance companies are a big part of the problem. Unbridled and uncontrolled, they lobby and mandate at will their rules on us, as well as our elected officers.

It is evident that the consumer is powerless against their voracity . At least if he wants to buy a car, get a mortgage, or obtain health care. High rates of insurance are a large factor in denying the access to homeownership to many citizens, as are high property tax rates.

Five years since we had a major hurricane, no losses for the insurers, but still paid our premiums. We already had our rates raised after Katrina.

So what exactly happened that forced these insurance companies to pump up again their rate at this shameful levels? And how could they convince our legislators?

Without being a specialist in actuarial sciences and risks calculations, my bet is that they do it simply because they can. And they will keep doing it unless you and me do something about it.

Henry B. Nathan is a Florida Realtor at United Realty Group Inc.
Visit my website: http://www.condo-southflorida.com
where you can search for Aventura Condos, Florida Condos, Sunny Isles Condos,

More on the Short Sales Saga

Read at Realtors.org (Florida Realtors website)

Government urges short sales, but experts aren’t sure they will help

With the highly touted federal mortgage-modification program falling short of its target numbers, the government has looked into alternatives to foreclosure and come up with a possible, though not original, solution: The short sale, a transaction in which the lender accepts less than the balance owed on the mortgage. Beginning April 5, under new Treasury Department rules, short sales will be presented as the potential next step for homeowners who are rejected by or fail to make the grade for the federal Home Affordable Modification Program (HAMP).

RealtyTrac chief economist Rick Sharga suggested that offering the short-sale program is the administration’s acknowledgment that its current mortgage-modification effort “can’t solve the foreclosure problem by itself.” Kevin Gillen, vice president of Econsult of Philadelphia, said there was both statistical and anecdotal evidence that lenders have been holding off on foreclosure proceedings. “No doubt that part of this is due to staff shortages relative to the volume of delinquencies, but it’s also due to uncertainty over near-term government policy,” he said. Sharga sees positive elements in the new guidelines: Both homeowners and mortgage servicers will have financial incentive to participate in short sales; there are limited payouts for second lienholders, “and paperwork is standardized, which makes it easier for everyone to comply.” The new Home Affordable Foreclosure Alternative program will run until Dec. 31, 2012. Among its provisions:

• The lender must offer a short sale in writing to the borrower within 30 days after the borrower either is ruled ineligible for mortgage modification under the HAMP program or has been ruled unable to sustain payments under a trial plan.

• A borrower may receive up to $1,500 to assist with relocation expenses.

• Incentives of $1,000 will be offered to lenders for each completed short sale. For each deed in lieu of foreclosure, in which the borrower voluntarily transfers the property to the lender, $1,000 will be paid to the lender.

• A lender with a second lien on the property will get up to $3,000 of the short-sale proceeds, or can pursue a short sale outside the program if it doesn’t agree to share.

• The lender will not be permitted to reduce the real estate agent’s commission after an offer on a property has been received.

Currently, short sales don’t make up a big piece of the real estate market, either regionally or nationwide, for a variety of reasons. One is they tend to be difficult and time-consuming.

“I handled a short sale of a condo in Bensalem (Pa.) that took a year,” said real estate broker Christopher J. Artur. Typically, there is “so much aggravation and red tape involved that some buyers get so fed up they walk away.” Nationally, just 14 percent of all existing-home transactions in January were short sales, the National Association of Realtors says. In the Philadelphia region, they made up 6.9 percent of total homes for sale at the end of January, said Art Herling, regional vice president at Long & Foster Real Estate. “I call short sales ‘organized chaos,’ “ said Noelle Barbone, office manager of Weichert Realtors’ Media office.

Each lender works short sales differently, “at their own pace, and it depends on how behind (the homeowners) are on mortgage payments, if the house is worth less than they owe, and whether or not foreclosure paperwork has been filed.” The new program is unlikely to make short sales easier, even as an alternative to foreclosure. “What one needs in a short sale is time,” Barbone said. But these days, as buyers race to meet the April 30 agreement-of-sale deadline for the federal tax credit, time is money. “I had first-time buyers this weekend with 20 percent down, and we found two houses they liked,” said Cheryl Miller of Long & Foster’s Blue Bell office.

Both were short sales, however, and neither the seller nor the agent could give a definite timeline for even seeing an executed agreement of sale, she said. “Timing is pretty critical for the first-time buyer, and viable houses that are short sales are remaining unsold” as a result, Miller said. Sharga doesn’t think the new short-sale program will be the answer the government seeks. “While we’ll likely see an increase in the number of short sales, I doubt that the reality will live up to the hype.”

From FloridaRealtors.org - March 12, 2010

I am a real estate professional at United Realty Group Inc.
You can visit my website: http://www.condo-southflorida.com/ where you can search for Hallandale Beach Condos, Sunny Isles Condos