Yesterday’s testimony earlier than the Florida Home Insurance coverage & Banking Subcommittee ripped the quilt off a narrative that’s been brewing for years: the Workplace of Insurance coverage Regulation (OIR) underneath David Altmaier had a accomplished, paid-for, red-flag-waving report about insurer affiliate transactions exhibiting lots of of hundreds of thousands of hidden earnings for the insurance coverage {industry} — and easily selected to disregard it.
Jan Moenck, the skilled from Threat & Regulatory Consulting who authored the “draft” Insurer Affiliate Examine, testified underneath oath that the report was full. She made clear that the “draft” label was a typical placeholder so OIR might request minor edits, however in her skilled opinion, her findings and suggestions had been last. Moenck stated she adopted up a number of occasions with OIR after delivering the report however obtained no request for adjustments, no request for additional work, and — most tellingly — no additional communication. OIR paid her invoice in full. That was the top of it.
The consequence? Legislators, who spent the 2 years debating the necessity for enormous insurance coverage reforms, had been stored utterly at the hours of darkness a few examine that might have modified your complete dialog.
One legislator flatly stated that the OIR lied to them within the final listening to. And let’s be clear: the accountability sits squarely on former Insurance coverage Commissioner David Altmaier’s shoulders. Altmaier, who left the put up in 2022 to develop into a lobbyist for insurance coverage firm pursuits, had the report sitting in his inbox whereas lawmakers scrambled to grasp skyrocketing premiums and insurer insolvencies. His successor, Michael Yaworsky, solely took over after Altmaier’s departure.
The political optics are brutal. Whereas householders misplaced protection and paid premiums by means of the nostril, Florida’s prime insurance coverage regulator had a professionally ready report hinting at earnings being siphoned off by means of affiliate corporations, MGAs, TPAs, and reinsurers — and did nothing with it.
However as we speak’s listening to didn’t simply finish with finger-pointing. Florida Home management promised motion: The Chair of the committee introduced that the Florida Home would rent the very best forensic accountants accessible to audit the affiliated firm transactions themselves. As an alternative of trusting the OIR, the Florida Home of Representatives is now doing the job insurance coverage regulators did not do.
Which means insurers, together with their captive MGAs, TPAs, and affiliated reinsurers, are about to get a full monetary examination — this time with public accountability.
Lawrence Mower was the investigative journalist who uncovered the report by means of a freedom of data request. His article about yesterday’s listening to, Florida Regulators Didn’t Observe Up on Insurance coverage Earnings Examine, Creator Says, reported that this investigation goes to have main implications for the way Florida regulates property insurers transferring ahead. I agree.
If this report had seen the sunshine of day when it was accomplished — again when lawmakers had been advised they’d “no selection” however to go insurance coverage industry-friendly reforms — the insurance coverage debate and laws in Florida might need regarded very totally different. It begs the query of whether or not Altmaier was already appearing as a lobbyist for the insurance coverage {industry} earlier than he formally left his place as insurance coverage commissioner.
Keep tuned. This investigation is taking time. However the subsequent few chapters of this investigation promise to be much more explosive.
For individuals who didn’t see the final listening to, I’ve connected a replica of the transcript so you possibly can see precisely what former insurance coverage commissioner David Altmaier stated concerning the buried report.
Thought For The Day
“It’s not the crime that will get you—it’s the cover-up.”
– Richard Nixon
