Florida homeowners become Slide customers — whether they want to or not | Commentary

Two years ago, when St. Johns Insurance Co. was going under in Florida, state regulators let Slide Insurance — a startup company that virtually no one had ever heard of — take over 147,000 St. Johns policies and tens of millions of dollars in prepaid premiums.

Other insurance companies were aghast. Not only did they tell the Insurance Journal that they hadn’t been invited to compete for the policies, they were flabbergasted that so many policies were given to a company that didn’t exist as an authorized carrier just months earlier.

“It’s an unfair advantage for Slide and it just seems like a sweetheart deal,” Bob Ritchie, the CEO of Tampa-based American Integrity Insurance told the Journal at the time.

Other insurance execs seemed to agree, as explained in the Journal’s piece: “Florida Insurers Crying Foul Over Slide’s ‘Favored’ Treatment in St. Johns Insolvency.”

Flash forward to today. The same company that scored millions of new policies with the help of state regulators two years ago is back in the headlines.

The Sun-Sentinel’s Ron Hurtibise reported that Slide recently took advantage of an effort by the state-run Citizens Property Insurance Company to shed policies by “offering” to take the policies off the state’s hands.

The catch: Slide’s “offers” sometimes included massive rate hikes over what homeowners were paying Citizens — of 50%, 100%, even more than 300%. And if Citizens policy holders didn’t actively respond to the snail-mail letters — because they didn’t receive them, understand them or for any other reason — those customers would automatically become Slide customers.

Hurtibise found that “15,478 of those policyholders were transferred anyway to higher-cost Slide policies because they did not contact Citizens.”

New insurer offered Citizens customers steep premium hikes. Then the state stepped in.

I suppose it’s theoretically possible that someone paying $3,000 a year for insurance looked at a letter that told them that they would start paying $5,000 a year for insurance unless they responded and thought: Hey, that sounds like a great idea! I’m going to do nothing and watch my rates skyrocket.

But that defies common sense. Even Citizens CEO Tim Cerio acknowledged as much to state officials saying: “Maybe there’s a reason a policyholder might want to pay more … if it’s 100% more, I can’t fathom what that reason would be.”

Bingo. So something already stinks.

Citizens execs would later say Slide agreed to rescind offers that represented hikes of more than 100%, and the state decided to flat-out prohibit any company from making future “offers” of 40% increases or more.

But here’s the part I just don’t get: I simply can’t believe that no one envisioned this would be a problem before it was. I mean, I’m no insurance executive, but the moment I heard that the state was letting companies take customers at majorly jacked-up rates by method of non-response, I thought: “What’s to stop some company from ‘offering’ some insanely exorbitant amount, realizing many customers will just default into paying it, at least temporarily?”

That question, by the way, isn’t paraphrased. It’s word-for-word what I posed to a former Citizens Insurance official in an email back in October of 2023.

Some other insurance companies had also offered higher rates to which Citizens customers could be defaulted. But the state says Slide offered the most by far.

I think homeowners and residents deserve answers.

First, you have some of the industry’s own executives saying Slide got a sweetheart deal to assume policies back in 2022. And now we have new reporting saying that more than 15,000 homeowners may have been moved over to Slide, even though it may not have been in their best financial interest.

Lawmakers should launch an investigation.

Slide CEO Bruce Lucas didn’t respond to questions I sent him this week. But a spokesman for the company told the Sun-Sentinel that its data analysis was “extremely flawed.” The company said the eye-popping premium increases were “outliers” and noted that some customers actually paid less when they switched to Slide.

Wonderful. Then certainly an investigation would vet all that out.

Slide said the average rate increase for all of its assumed policies was a meager 8%, which sounds fair. A company spokesman also said the “average” Citizens customer would ultimately pay less, since Slide reduced its rates while Citizens raised theirs. But the Sun-Sentinel reported that Citizens “did not have enough data to verify Slide’s numbers.”

All the more reason for an investigation — to verify everything.

The reality is that Floridians don’t have any real watchdogs when it comes to insurance. The state no longer has an independently elected insurance commissioner. The last appointed one left to become a lobbyist. And regulators, lawmakers and lobbyists are all incestuously cozy.

Slide has donated nearly $970,000 to political committees in Florida over the last two cycles, including more than $200,000 to the Republican Party of Florida and $100,000 to a committee linked to Chief Financial Officer Jimmy Patronis whose original registered agent was … wait for it … Tim Cerio, the current CEO of Citizens.

A Slide spokesman said the company is merely “an active participant in democracy” and complies with all state and federal laws.

But the Consumer Federation of America suggested all those donations — in connection with Slide’s recent acquisition of policies with the state’s help — were “evidence of a very cozy, and possibly improper, relationship.”

A spokesman for Attorney General Ashley Moody said this week that her office had received 18 complaints about Slide Insurance — all of which she had forwarded back to the state insurance office. We’ll see how that turns out.

It’s worth noting that the whole idea of forcing customers onto more costly plans unless they take action is a terribly anti-consumer practice. It’s something you’d expect out of a timeshare or cable-company agreement. Not your own government.

And the Sun-Sentinel noted that, in a podcast interview years ago, Lucas described the process by saying: “You send them a letter, they toss the letter in the garbage. They’re a customer of yours.”

That was years ago. A Slide spokesman said those remarks were “not an assessment of the current market nor is it a part of Slide’s strategy.”

But one of Citizens’ own board members, Charlie Lydecker, said at a board meeting: “it feels to me like they are banking on people not reading the mail. And if they can get a certain return on that, that feels to me like a really bad thing.”

Lydecker later added that he thinks Slide has been “a good corporate citizen.”

Fair enough. That’s the kind of thing a thorough investigation should suss out.

Right now, though, we have evidence of more than 15,000 customers being moved to Slide at high rates without their request, other insurance execs saying Slide got a sweetheart deal to acquire tens of thousands of other policies and a consumer group saying things look way too cozy.

Why wouldn’t you want answers to what’s really going on?

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