Wednesday, March 18, 2009

Peoples Trust Insurance Co. Stopped

Received Your Latest "Discount" Insurance Ad In the Mail?

LABELLE, FL. -- Florida Insurance Commissioner Kevin McCarty today announced that the Office of Insurance Regulation (Office) and People's Trust Insurance Co. (People's Trust) have entered into a Consent Order that requires People's Trust to stop writing new policies until it complies with provisions of the order.

People's Trust, heavily advertising it's "discount" home owner's policies by direct mail, will not be able to sell new policies until it meets the conditions of the order, but it still must continue to service existing customers and claims. It's latest ad doesn't quote prices like previous ads but does still claim lower prices than other companies. Not too hard to do since the comparison companies have some of the highest rates in Florida to begin with.

As the result of the Office's comprehensive investigation of People's Trust, the Office found, among other things, that People's Trust: failed to obtain inspection reports to confirm replacement cost values and/or insurability; failed to obtain proof of protective devices; failed to comply with various practices related to claims submission, investigation and payment; and failed to comply with its approved business plan, by writing more policies than allowed – an issue that could have created exposure beyond the company's claims-paying ability.

"I appreciate the new concept that People's Trust has introduced to the sale of property insurance in Florida," said Commissioner McCarty. "The company has expressed some ideas that, if implemented, would address some of the most difficult issues in the property insurance market. However, insurance companies are required by law to meet certain standards. The Consent Order is intended to bring the company into compliance with those legal standards."

The Consent Order requires People's Trust to, within 30 days: pay an administrative penalty of $150,000 and $5,000 in costs; deposit $500,000 with the Bureau of Collateral Management; and provide the Office with a certification that required corrective measures have been implemented in compliance with the order.

Florida Chief Financial Officer Alex Sink today released the following statement in response to the Office of Insurance Regulation’s (OIR) Consent Order with People’s Trust Insurance Company:

"The Office of Insurance Regulation’s Consent Order with People's Trust Insurance Company shows that People’s Trust committed numerous violations of the laws designed to protect Florida’s insurance consumers. These violations confirm my concerns about People's Trust MGA’s use of unlicensed agents to advise consumers on insurance matters. I am deeply troubled by these violations, and commend Commissioner McCarty for taking action.

"It is my responsibility to make sure Floridians are getting the best advice and making informed decisions on insurance products by dealing with properly licensed insurance agents. My office will continue to work to ensure that People's Trust Managing General Agent is prevented from using unlicensed agents to sell insurance products."

The Consent Order also requires People's Trust to use licensed agents and customer service representatives in compliance with the Insurance Code when soliciting and transacting insurance business and to provide proof of adequate reinsurance to the Office.

The Office's investigation of People's Trust began in December, and an onsite examination was conducted from Feb. 1 through Feb. 20.


  1. Anonymous5:30 PM

    Few lay people ever bother to read their insurance policy no less understand it. It is sad how many people sing the praises of this company simply because they "saved" hundreds of premium dollars. The true tragedy will be when a large number of claims need to be paid and the company folds. Rest assured, the management will have been well paid and sleeping soundly while policyholders will have no roof over their head. The Florida Insurance Office of Insurance Regulation needs to stay "all over" this company as alarm bells are already ringing.

  2. Anonymous9:56 AM

    I am seeing people bashing this company all over the place. I ALSO see everyone that made a mess in this market leaving Florida. Is it possible that this company woulnd't have sold as many policies if STATE FARM had not pulled the carpet from under all their policy holders? I should know, I was one of them. and my coverage is THE SAME as state farms. I correct myself, state farm had my other structures at 25K, which meant I was paying for a structure that I didn't even own. I love how people try to smash a company trying to do right by the state. florida is making it to where NO companies will in sure in florida whatsoever. way to go alex sink. don't get me started on her either. I've heard rumors

  3. Anonymous9:14 PM

    Why do you let companys like Royal Palm tell its customers how much coverage they have to have.

    i.e. They told me I have to have 200,000 and I only want 100,000 they told me that I could not do it.

    Johnny Haddocck

  4. Anonymous5:35 PM

    This is pure and simple communism.

    The CFO & insurance commissioner felt the pressure from insurance lobbyist to crack down on People's Trust to force people back into the fold - aka, the standard insurance companies that have made bank over the years on this crap.

    I received a new letter from PT indicating all sorts of hoops to jump through. Signature that I don't have flood insurance, I can waive windstorm coverage by Florida law (excuse me!?!), exlude contents, request for prior policy, inspections of shutters ... all within 15 days.


    The CFO, commish and lobbyists are forcing PT to INCREASE their rates because they were CLEANING THE CLOCK of all of the other insurance carriers that are in cahoots with the politicos. This is YEY ANOTHER FLEECING of the American People.

    Escrow accounts, Insurance, Taxes, Mortgages's all part of keeping their hand in your pocket.

    Insurance companies are in the business to make money - they are not here to help you. Try to make a claim and they drop you like a hot rock!

  5. Anonymous2:08 PM

    "Insurance companies are in the business to make money" So true. I have been there. When I have a claim (first in 15 years), the insurance companies simply threw one roadblock after another. Fist, it down played the roof damage (which I am not physically able to go up to check); then it told me that most of the damage was caused by "wear and tear"..., simply one lie after another. Now, they are bashing PT for giving us a lower premium by bypassing the agents who sit around doing nothing but collecting fees year after year.

  6. Anonymous11:25 AM

    Pay your house off and skip the insurance.

  7. Anonymous5:17 PM

    Why do we need to have insurance if the insurance companies will try their best not to honor an honest claim, like hurricane damage?. They play the game like during bad weather, they drop every one off and when the sun shine they all raised rates. We can't win this government blessed scam.

  8. I received a cancellation notice for policy #pfl031794-01, date 11/03/2010, effective date of notice 2/12/2010 12:01am. exp date 2/12/2011 12:01am Policy type-homeowners. I invite mr. kevin mccarty, insurance commissioner to investigate why are they cancelling me, since they cancel my policy more than a year ago and I no longer belong to their insurance. They are lousy and non professional. They have no idea what they are doing. I hope that they are not deducting any money from my account .Mr e velez

  9. Anonymous2:58 PM

    started a policy with federated national insurance
    out of fort lauderdale fl.on february 3th 2010
    received notice of cancellation/renewal 10/21/2010
    no claims were ever filed or no reason was givin
    this company sucks do not buy home insurance from
    them they took my money for one year then cancelled.

  10. Anonymous3:48 PM

    I understand this is a older blog post, but I wonder where these current homeowners are today. As for the person who questioned why Royal Palm required them to be insured at the $200,000 replacement cost vs the $100,000 they the time of a hurricane or fire, I'm sure you're going to want your home rebuilt. I'd be interested to see you rebuild any home at today's cost for $100,000. You'd most likely expect your house to be put back exactly as you had it & that's what your insurance company wants to do for you. Regardless of your negative outlook on the insurance industry (brought on by the government no less), most agents always have the best interest of the homeowner in mind & strive to insure you correctly at all times.

  11. Anonymous10:10 AM

    New scam People's Trust does not disclose to the public that THEIR home inspector which is an affliate they also do not disclose- must perform a complete come inspection not just a 4 point. So a licensed Home inspector of your choice is no longer acceptable-

  12. Anonymous3:54 PM

    Some one in this blog mentioned...This is pure and simple communism. Not, It is is MAFIA, that is what it really is. They only want more and you.. are do not have oder uption to pay more or lose every thing you have, your property, your family, even your live.
    At the end all the money is for them to have more ships, airplanes, castle and money for them to enjoy even more cover the lovists and politicians campain.
    Your uption? to paid the modern MAFiA.

  13. Anonymous4:07 PM

    As long as they can raise your home value at will and thereby raise your insurance premium (of course "they" don't get anything out of this) the cost will continue to rise, and you have no input. I wonder what the connection is to the real estate industry that sets the retail value high enough to get a very nice payday when the house is sold (added to the actual value plus a kickback from the financing company) and the commission that approves these practices. The whole process is for the purpose of raising the bottom line. Then on top of that we have to pay a hurricane premium so the people in hurricane prone areas can get their insurance cheaper (charged on automobile insurance too). We haven't had a hurricane in years, but we still get that added premium.