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Letter to the editor

Failed insurer lives on, sort of

Poe & Associates LLC rises from Florida's biggest insurance bust.

By TOM ZUCCO, Times Staff Writer
Published October 20, 2007

When Susan Massaconi first saw the letter earlier this week, she thought it was an apology.

Then she opened it. Inside was a sales pitch from Poe & Associates LLC, a Tampa insurance agency. But not just any agency.

This one has ties to the largest insurance failure in Florida history.

Massaconi had been a policyholder of Southern Family Insurance, one of three insurers that was liquidated in June 2006 by the Florida Department of Financial Services after its parent company, Poe Financial Group Inc., couldn't pay claims following the 2004-05 hurricane seasons.

Two months after the liquidation, Poe Financial Group filed for Chapter 11 bankruptcy reorganization in federal court in Tampa.

But Poe & Associates LLC lives on.

Florida corporate records list Poe & Associates as a limited liability company first registered in November 2005. Poe Financial Group is listed as the manager/member, and William F. Poe Sr., a former mayor of Tampa and the founder of Poe Financial Group, signed the company's 2007 annual report.

But Poe & Associates LLC is not part of the Chapter 11 proceedings, said DFS spokeswoman Nina Banister. "It is a separate entity."

Banister said the letter Massaconi received is "advertising for that entity, an insurance agency. This type of advertising is common; however, we are reviewing this letter further to determine if there may be any misleading statements."

Massaconi, 55, drew a stronger connection.

"I was flabbergasted when I opened the letter," she said. "They wanted me to buy insurance through them."

In her job as a customer service representative with the Sarasota County Clerk's office, Massaconi said she saw firsthand the effects of Poe's collapse on policyholders.

"I saw the bankruptcies and foreclosures, people being thrown out of their homes," she said. "And I'm thinking, these people are still allowed to do business?"

The letter Massaconi received claims homeowners can save on their property insurance bill.

"Poe & Associates, an insurance agency, has reviewed your home with seven different private insurance companies looking for the lowest price. We may be able to help reduce your premium."

Neither William Poe Sr. nor other company officials could be reached for comment Friday.

The collapse of the Poe Group in 2006 had financial effects that are still being felt. More than 320,000 policyholders were dropped, with most landing in state-run Citizens Property Insurance.

Poe also left something else behind - about 47,000 unpaid claims totalling about $1.35-billion.

A large chunk of that is coming out of the pockets of every residential and commercial policyholder in Florida. Some of the deficit was recovered through backup insurance and money already in the Florida Insurance Guaranty Association, or FIGA, the group charged with covering unpaid claims and repaying unused premiums after insurance companies become insolvent. FIGA uses assessments on all Floridians who have property insurance.

So far, the net cost to Floridians to cover the unpaid Poe claims: $747-million.

Over the past two years, Florida policyholders have twice seen a 2 percent assessment tacked onto their insurance premiums.

A FIGA spokeswoman said Friday that another assessment is likely next year to cover the remaining debt.

After she was dropped by Poe subsidiary Southern Family, Massaconi, said she refused to go to Citizens. Her 39-year-old home is now insured by United Property and Casualty.

"I'm saving the letter," she said. "I hope lots of people will want to see it."

Tom Zucco can be reached at zucco@sptimes.com or 727 893-8247.

[Last modified October 19, 2007, 22:59:10]