With expenses at $1.9 billion a year, Citizens Property Insurance leaders are studying the need to maintain three corporate locations across Florida, the pay and benefits given employees, travel costs, and the overall management structure.
At the same time, officials are defending the costs of sending officials to New York, Bermuda, London and Zurich as they negotiated a pair of bond placements that resulted in $47 million in savings.
Longtime insurance industry executive Barry Gilway, the new head of the bloated state-backed insurance provider that was created to provide last-resort residential property insurance coverage, said independent studies are being conducted companywide on its expenses.
Among the areas being looked at:
The need to operate offices in Jacksonville, Tampa and Tallahassee.
Staff costs versus outsourcing.
The organizational structure.
Expense accounts, travel costs.
Staff pay and benefits packages.
At the surface, we are below market from a salary standpoint; obviously, one of the reasons is that we havent had a merit increase or cost of living increase since 2009, Gilway said. However, there are compensations on the benefits side and we do have a richer benefit plan on a comparative basis than other companies.
Gilway said he personally believes the organizational structure can be revamped, while it appears the expense controls now in place are fairly stringent.
My initial impression of expense controls is as good as Ive seen, Gilway said.Its a very effective process. I know what I have to sign. I know what my managers have to sign.
Citizens Chairman Carlos Lacasa said he asked Gilway if the travel costs need to be revamped or improved upon, even though the costs are only a fraction of a percentage point of the total administrative budget.
Lacasas call comes after former interim president, Thomas Grady, submitted travel vouchers from March and April totaling $9,334 and included $941 for four nights with meals at the Grand Hyatt Tampa Bay and $114 for a limo ride from the Fort Myers airport to his home in Naples.
Citizens has also received questions about the costs associated with travel by a couple of executives to Bermuda and Europe to negotiate two $750 million bond placements that resulted in a combined $47 million savings for the company.
I think you need to understand when you travel Bermuda or travel to London, youre not going to find a $125 Marriott, they dont exist, Gilway said.When you do have international travel, there are expenses associated with it.
Reach Jim Turner at email@example.com or at (772) 215-9889.