Florida Office Of Insurance Regulation Minimizes Problems With The My Safe Florida Home Program

By
Home Inspector with Gold Coast Inspections

The My Safe Florida Home program has spent the majority of its money, despite being far short of its target goal of 400,000 free hurricane inspections.  It has identified issues in its inspection process: insufficient training, unqualified inspectors and confusion about basic building features.

It also has spent months bragging that the inspections helped homeowners across the state save hundreds of dollars each in insurance premiums, a claim the head of the Department of Financial Services concedes she can't prove.  Chief Financial Officer Alex Sink, in a recent interview with The Tampa Tribune, downplayed any problems.

"Let's put this in perspective. We've done about 130,000 inspections. In my book, that's a pretty big number," she said. "We've heard from less than 2 percent of the homeowners who said they found errors in their report. I think that's ... pretty reasonable."

My Safe Florida Home, created in 2006 to help residents determine whether their homes can withstand a hurricane, and to provide financial assistance to some homeowners to make improvements, has spent about $178 million of the $250 million allocated by the Legislature.  It has completed 127,826 inspections and awarded grants to 21,936 people.

To put this in further perspective, the total funds allocated for the program was $250 million with only $100 million defined for grants.  The inspections to date equal about $20 million.  Also, only 32.5 percent of the targeted inspections have bee performed and over 70 percent of the allocated grant funds have been spent.  So the big question that hasn't been answered is "where did all of the money go?"  With a less than favorable participation by Florida residents leaves the program is serious doubt by homeowners.

In addition, the program also has fielded complaints since its inception. Initially, applicants griped about the long lag time in receiving their inspections. Then they spoke out against legislative tweaks that eliminated the majority of the state from receiving a grant.  In particular, the program originally defined as any single family, site built home that had an assessed value of $500,000 or less, then the program was modified to an assessed value of $300,000 or less.  These adjustments left a foul taste for most Florida homeowners as they were now excluded from the grants.

Lately, criticism has been levied at the inspection reports, which some residents have said include glaring inaccuracies about their homes.

More Inspections Wanted

Sink said she supports more inspections, particularly with money running low and no guarantee more will be allocated by the Legislature.  There is about $72 million remaining in the program's fund.

"If there's not enough money for grants ... these inspections alone would result in tremendous cost savings," she said. "If I was designing the program, I would design it to do more inspections. Set aside an amount of grant money, and really hit low-income populations."

Each free inspection costs the state $150. Reinspections also cost $150. The average grant awarded is $3,300, but the grants can go up to $5,000 apiece.

The state recently spent about $385,000 to reinspect 2,567 homes, or about 2 percent of the total inspections done, to gauge inspector accuracy. A subsequent report found a process that was susceptible to discrepancies and mistakes.

Sink said the reinspections were adequate, however, to help make "us aware of any problems or issues."

She said she did not see a need to reinspect more homes. So far, only 42 of the inspection reports have been revised due to mistakes, she said.

Sink Doesn't Have Proof Of Savings

The inspection reports are key, she said, particularly in helping reduce insurance premiums for residents whose homes are found to be better fortified than initially thought.  Each participant receives a form that lists areas where insurance reductions might be eligible. They can then give that form to their insurance provider.

"Seventy percent of the inspections we've done so far are resulting in an average of $200 savings today," Sink said. "I had one guy tell me he had an inspection done and he saved $8,000."  Does she have proof to support his claim? No.  Her office doesn't track how many of the forms are turned in. They don't know for sure how many people have received an insurance discount or for how much.  The state just provides the form, she said.

"I believe in personal responsibility. The state can't hold somebody's hand and lead them to the trough," Sink said. "I'm having people tell me that they literally are getting these discounts."

Changes Questioned

In 2007, after the program had been launched, the Legislature tweaked the rules. Lawmakers voted to restrict grant eligibility to residents whose homes are insured for $300,000 or less and who live within the coastal windborne debris region.

The changes removed most of Hillsborough County, Sink's home county, from being eligible as just two small slivers of Hillsborough fall into the windborne debris region.  However, Sink said it allowed more low-income families to be eligible.

"Many, many, many low-income people live in the windborne debris region," she said, citing Pinellas County as an example. "There are many, many, many homes over there valued at less than $300,000. When you say windborne, people think coastal. It's not." Sink said the changes needed to occur to keep the program fair.

"We were hearing anecdotal stories of people living in million-dollar houses getting grants," she said. "I don't know if I want my hard-earned tax dollars going to support a millionaire. They ought to buy their own shutters."

'Probably Not' Enough Training

In October, My Safe Florida Home officials announced a reduction in the number of firms hired to conduct inspections.  Of the 11 inspection firms hired earlier this year, five were let go. One of those was fired for multiple contract violations, including employing a majority of inspectors whose background experience could not be verified.

Training has been an issue for the program. Inspectors are required to attend one daylong class and take an open-book test. If they score 90 percent or better, they can begin work.  Asked if there has been enough training, Sink laughed. "Probably not," she said.

Tami Torres, special programs administrator, said the remaining inspection firms are doing more field training, per the state's instruction.  The inspection training manual has been revamped, she said, to include photos and more information to help inspectors in the field.  Technical bulletins - essentially inspection tips, questions or issues - are now issued every other week. Each firm must document that its inspectors read the bulletins, Torres said.

Sink said she was not involved in deciding which firms would continue with the program. She also said she did not know that two of the firms retained, Applied Research Associates and SkyeTec, have financial and other ties to her office.

ARA, as the company is known, was paid by the state to design the software used by inspectors. It also was paid to develop a scale that gauges how well a home would hold up in a storm.

SkyeTec employs as a lobbyist the former deputy chief financial officer, Lisa Miller, who helped create My Safe Florida Home with former CFO Tom Gallagher. Miller has previously said she has no contact with her former office, per state ethics laws.  "I personally wasn't aware of any of that," Sink said.

Others in which particiapated in the My Safe Florida Home training program, questioned the depth of individuals sent by the inspection firms to complete the manditory class provided by the state.  "I was amazed at the lack of overall construction knowledge of some of the individuals that took the class with me," comments David Manley, President Gold Coast Inspections of Coral Springs, "It was evident by the borrage of elementary questions during the class that the majority of the group just didn't have a clue." 

Other participants cited the instructor as saying,"The previous class had a 70 percent failure rate."  "Anyone with basic construction knowledge should not have had any problems with the class or test," added Mr. Manley, " It was evident there were individuals there that should not have been."

For homeowners that are looking for the free inspection in efforts of reducing their windstorm premium, it just doesn't pay.  By the time you apply, wait for the inspection and recieve the report it is typically in the homeowner's best interest to hire an independent inspector to facilitate the inspection and pay the nominal $150 fee.  Remember, time is money and if you're going to be forced to wait 3-6 months that is existing premium dollars, your money, down the drain.

"We charge $115 for the inspection, forward the report to the homeowner and insurance agent and our clients are saving an average of $1800 per year on their windstorm (hurricane) premiums," comments Mr. Manley, " in addition, we can typically schedule the home within 3-4 business days."

The ideas expressed by David Manley, Gold Coast Inspections of Coral Springs was of an opinion the funds should have always gone towards the poor and for specific upgrades such as hurricane panels, exterior windows, pedestrian and garage doors. "The project was way over-thought," Mr. Manley adds, "the concept of a pay to play role for the poor is rediculous."

"With buiding codes being changed, incorporating more deck anchors and truss/rafter clips and straps, it was just a waste of time and money to formulate formal engineering reports for suggested upgrades," Mr. Manley explains, "homeowners are very aware of the devices needed to protect their homes, and a simple survey identifying whether a home has hurricane devices should have been enough.  The grant funds should have been used for just that.  I my opinion, this program was a gross mis-allocation of taxpayer funds."

For more information on how to reduce your windstorm premiums, please call:

GOLD COAST INSPECTIONS -CORAL SPRINGS

954-753-3755

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