Fort Lauderdale, FL – On behalf of property insurance consumers in Florida, the Florida Association for Insurance Reform (FAIR) has written to the US Securities and Exchange Commission regarding an incident that threatens the market and needs to be addressed.
FAIR is demanding an investigation into Anthony Bozza’s “short pitch” on Universal Insurance Holdings, Inc. (UVE) during the November 17, 2015 Robin Hood Investors Conference 2015 that contained numerous assertions that were misleading, contained material omissions of facts, or were false. Listeners to Mr. Bozza’s presentation were led to conclude that UVE was not capable of meeting key industry standards. FAIR contends that objective evidence exists that strongly disputes these allegations.
FAIR’s mission is “Promoting public policies to protect Florida’s insurance consumers and encourage a robust competitive insurance industry.” As such, the organization has a substantial interest in two issues: that property insurance companies have the financial ability to pay claims resulting from all risks, especially catastrophic risks; and that they treat their policy holders in good faith by providing adequate coverage and paying claims when due.
All insurance companies, including UVE, are subject to regulation by the Florida Office of Insurance Regulation (FLOIR) and rated by various agencies to ensure that Florida insurance companies maintain a financial rating acceptable to major mortgage entities such as Fannie Mae, Freddie Mac, and HUD. Three rating agencies are deemed as acceptable within the Florida marketplace: Standard & Poors, A.M. Best, and Demotech.
Each insurance company must also prove to FLOIR that it has the wherewithal to pay claims. In its 2015 Catastrophe Stress Test, the Office tested companies’ ability to pay based on three historic storm scenarios: the 1947 Fort Lauderdale hurricane (Category 4); the 1921 Tampa Bay hurricane (Category 3); and the four major storms that made landfall in 2004, Charley (Category 4 hurricane), Frances, Ivan, and Jeanne. UVE was one of 67 participating insurance companies that passed each scenario.
While noting that none of the FAIR senior staff or Board executive committee holds any interests in UVE, and that neither Universal Insurance Holdings, Inc. nor any of its affiliates or subsidiaries are a member of FAIR, Jay Neal, FAIR’s President and CEO, stated: “Bozza’s reckless presentation was intended to manipulate the stock price of a publicly traded company. His actions threaten both Florida insurance consumers and market stability and must be sanctioned.”