Florida race for CFO has meaning for insurance interests

In the race for Florida’s Chief Financial Officer, the public is not only being asked to vote, but voters are also being challenged to learn about the responsibilities that accompany the office.

The job has been described as “probably the second most powerful position in the state of Florida” by The Associated Press.

The CFO’s major duties involve paying the state’s bills and controlling finances. But there’s a whole lot more to it. The CFO also gets involved in matters of insurance, worker injuries, fire safety, fraud and even death — as the chief regulator of the funeral industry.

Insurance and more
The CFO has direct responsibility for 11 divisions in the Department of Financial Services: Treasury, Insurance Fraud, Consumer Services, Agents & Agency Services, Accounting and Auditing, Workers’ Compensation, Risk Management, State Fire Marshal, Funeral & Cemeteries, Administration, and Rehabilitation and Liquidation.

The recent September primaries yielded two candidates — Democrat Alex Sink and Republican Tom Lee — in anticipation of the November mid-term elections. The winner in the November election will be the second ever to hold the Cabinet post that was created in 2002 by combining the former offices of comptroller, treasurer, insurance commissioner and fire marshal. Tom Gallagher, who ran and lost in the recent primary race for Governor, was the first to hold the post.

Money matters
If money is the measure, the insurance industry might be seen as heavily favoring Republican Lee.

According to records with the Florida Division of Elections, Lee has received $167,782 of his total $3.1 million war chest from 406 people in insurance occupations.

Sink, on the other hand, shows $69,254 from insurance contributors of her total $2.5 million raised.

However, a major insurance industry player counters that impression. The Florida Association of Insurance Agents has endorsed the Democratic candidate, Sink.

While mainstream media outlets are touting the fact that party lines are being crossed, with some Republicans preferring the Democratic candidate and certain Democrats liking the Republican contender, Jeff Grady, president of the FAIA, said his organization’s endorsement of Sink is in no way a partisan issue.

Florida agents
“If this were a job interview, it would be a simple choice,” Grady said. “Alex Sink has the best set of qualifications. We need help to get out of the property insurance problems that Florida is facing; Alex Sink has shown a propensity to listen.”

Grady said the problems that have piled up in recent years have now been magnified to a critical level.

“What has happened over the past couple years has gotten worse,” he said. “This is an issue of incredible seriousness. We’ve pleaded with the current administration to address these issues.”

To emphasize his point that his group’s endorsement is not a partisan decision, Grady revealed that the FAIA board of directors is made up of 12 Republicans and two Democrats. “We sat through hours of debate on this decision; the stakes are high and we went about our work in a non-partisan fashion.”

Scott Johnson, executive vice president of FAIA, said it is Sink’s accessibility and willingness to listen that will benefit constituents.

Business versus politics
A recurring distinction in the CFO race is Sink’s business background versus Lee’s political background.

Tara Klimek, Sink’s communication director, said her boss has more than 25 years of financial experience managing the state’s dollars.

“Alex Sink was the president of the largest bank in Florida for seven years where she supervised more than 9,000 employees in 800 branches, representing more than $41 billion in customer deposits,” Klimek said. “She has also been very involved in state government over the years, having been appointed to several special committees.”

According to Klimek, the state needs a fiscal watchdog who will safeguard people’s tax dollars. Former Governor Lawton Chiles appointed Sink to the Commission on Government Accountability to the People, and Sink has advocated productivity and efficiency in state government as vice chair of TaxWatch — an organization that reviews how Florida collects and spends its tax dollars, Klimek noted.

Republican CFO candidate and current State Senate President Lee is basking in the support of former Democratic Agriculture Commissioner Bob Crawford, and others.

In a press release published during primary week, Crawford was quoted as saying, “Tom Lee has been an independent-minded and courageous leader who has stood up for consumers — even if that meant bucking his own party.”

Lee backers
As might be expected, some business groups are backing the Republican, including the state chapter of the National Federation of Independent Business.

“It’s the insurance regulation component of the job that is so important to us,” said NFIB’s Florida Director Allen Douglas. “Property insurance is killing business owners.”

Douglas maintained that Lee’s political experience and his ability to maneuver through the system would help him accomplish his goals. He said Lee was instrumental in getting the joint and several liability laws repealed.

“His family background is in business. His family owns a home building business, so he knows the issues business owners face,” Douglas said. “He has been a solid supporter of small businesses.”

The NIFB tracks candidates and their voting records — an integral factor in the organization’s endorsement process. “Tom Lee has a 100 percent voting record for the past 10 years,” Douglas said. “We won’t support a candidate unless they have at least a 70 percent voting record.”

Consumer view
Bill Newton, executive director of the Florida Consumer Action Network, said his organization supports Sink, in part because of Lee’s support for a bill passed in last year’s legislative session that the group said favors industry over consumers.

“Now we have a bill that allows insurance companies to raise their rates whenever they want,” Newton maintained.

“Sink has a solid business background and as the CFO, you have to understand business.”

Back in Lee’s corner is the Florida Home Builders Association. FHBA boasts a corporate membership of more than 21,000 builders throughout the state, to whom insurance issues are important, according to Edie Ousley, public affairs director. The association’s members believe Lee will tackle the insurance issues.

“Florida is experiencing a property insurance crisis right now,” Ousley said. “The crisis is wreaking havoc on our industry — if people can’t afford the insurance, they can’t afford to buy a house.”

Topics Florida