Senate criticizes then casts support for Citizens Insurance chief
04/01/2013 5:14 PM
04/02/2013 6:28 AM
The president of Citizens Property Insurance Corp. faced a grilling from lawmakers Monday, but ultimately received a unanimous vote of support after explaining his response to a series of recent scandals at the company.
Barry Gilway assured lawmakers that he had acted decisively to address issues that ranged from lavish executive travel spending to an unpopular home reinspection program to a laundry list of corporate improprieties.
“I may be 67, but, man, I learn every single day,” said Gilway, acknowledging that he was “naïve” when he became CEO last June and had made some mistakes.
The hearing itself was a sign of Gilway’s rocky tenure. The Legislature hauled the CEO before the Senate Ethics and Elections Committee for an up-or-down vote instead of a committee overseeing insurance or business issues.
Lawmakers, mostly those from coastal regions where Citizens has the greatest market share, reflected the displeasure of their constituents as they questioned Gilway.
Sen. John Legg, R-Lutz, said his constituents were “unhappy” about rate increases, coverage cutbacks and Citizens’ calculation of home values, which can be higher than other estimates.
Sen. Anitere Flores, R-Miami, hammered Gilway over the home reinspection program that has cost Floridians more than $200 million in higher insurance rates in recent years.
“People went out and invested money in hardening their homes,” she said, “under the premise that their insurance rates would go down.”
Gilway, who is paid a $350,000 a year salary, pointed out that many of the problems were in place before he joined Citizens, and that he had been working to soften the blow of some of the company’s austerity measures. He pointed out that homeowners who lost discounts during the reinspections could get another reinspection, free of charge.
Gilway took a much more conciliatory tone on Monday than he did last year when the Herald/Times first began reporting about the company’s internal scandals — which included drunken exploits, allegations of sexual harassment and use of the company credit card at strip clubs. At the time, Gilway blasted media coverage as “shameful” and “pathetic.”
On Monday, Gilway credited the media for helping to shine a light on many of the internal problems at Citizens. He gave himself a “D” grade for how he’s worked with the media, but an “A” for managing the insurer of 1.3 million policies.
“Without the media attention on expenses, it wouldn’t be addressed as succinctly as we addressed it,” he said.
Gilway, who has four decades of experience in the insurance industry, gathered support from a wide swath of lawmakers, who said they were willing to give him a chance.
“Prior to our meeting last week, I was prepared for us to give you a little harder time than we’ve given you today” said Sen. Jack Latvala, R-Clearwater. “To me, attitude’s about 80 percent of the game. And I think you’ve got the right attitude.”
Toluse Olorunnipa can be reached at tolorunnipa@MiamiHerald.com or on Twitter at @ToluseO.
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