New Liability Policy Sought : Controversial Insurance Firm Out of Picture in S.D.
The San Diego Housing Commission will end its association with a troubled offshore insurance company when the commission’s $2-million liability insurance policy expires Dec. 12, officials said Monday.
Centurion Insurance Ltd., based in the Caribbean on a small British dependency known as Turks and Caicos Islands, missed the housing commission’s Wednesday deadline to offer a bid to renew the policy, said Cathy Lexin, the commission’s deputy executive director.
Between December, 1986, and July, 1987, Centurion sold insurance policies to 28 public housing agencies across the west despite its failure to receive approval from the U.S. Department of Housing and Urban Development. HUD has withheld its endorsement of the fledgling firm because of its concern that Centurion’s assets are held offshore, out of the reach of public agencies should they attempt to seize them.
The San Diego Housing Commission bought its liability policy from Centurion last December when insurance was difficult or too expensive for public agencies to obtain from approved U.S.-based companies. Housing commission officials were not told that the firm was based offshore or that HUD approval was not final, Lexin said.
A Moot Question
Because Centurion did not bid to renew its insurance policy, the commission will not have to decide whether to dump the firm when its insurance policy expires Dec. 12. Instead, a housing commission committee will review four bids presented to the commission Monday and purchase the policy from one of them.
The four bids are from two insurance companies and two self-insurance pools for housing agencies. All four are based in the United States and are approved by HUD, said Elizabeth Morris, the commission’s acting executive director.
Thomas Eaton, Centurion’s founder and chairman of Centurion’s onshore representative, Wyndham Consulting Services of Burlingame, Calif., said that his company did not bid to renew the policy because it still has not received HUD approval.
“We had nothing in writing and we couldn’t comply” with a housing commission requirement that all bidders be sanctioned by HUD, Eaton said. “We couldn’t say when we were going to get approved.”
