An Ashford resident will be the superintendent of the Connecticut Captive Insurance Company charged with paying out claims to homeowners with collapsing basements.
Michael Maglaras is the principle of Michael Maglaras and Company, a firm that’s been running and starting captive insurance companies for more than 30 years, while Maglaras himself has been in the industry for 41 years. He used that experience as part of his sales pitch to homeowners Thursday, at a meeting of a committee formed by the Capitol Region Council of Governments tasked with dealing with crumbling foundations.
"I will assure you absolutely on a 41-year reputation that help is on the way,” Maglaras told the group. “It's coming soon. And we're moving as quickly as we humanly can."
The insurance company was laid out in state law by the Connecticut General Assembly to be the state’s mechanism to help homeowners who have basements crumbling around them. The issue was brought to light by the NBC Connecticut Troubleshooters in 2015.
The captive insurance company will be governed by a superintendent, Maglaras, who will also work with a board of directors that will decide how claims are handled and determine the parameters for paying them out.
Maglaras, who was born in New Hampshire and later lived for 30 years in Greenwich, said the single most important issue facing the board is having enough capital to pay out claims.
"We're going to be responsible for paying claims for which we receive no premium.” Maglaras said. “It is an unusual insurance arrangement, but it is what it is."
The Connecticut General Assembly approved a $12 surcharge on all homeowners insurance policies to go into effect this year to help pay for crumbling foundations relief. That’s on top of the $100 million also authorized by lawmakers earmarked for repairing foundations.
The goal, Maglaras said, is to develop a captive insurance company that is both efficient in the way it’s managed and the way it pays out claims. He said if that happens, then private insurers and the federal government could step in to provide even more cash for relief, knowing that the company will handle the money properly.
“Any insurer who would like to make a statement to the citizens of the state of Connecticut should be welcome to make that statement with a tax-deductible check and I'll accept it and that puts us in line I think for more funding to broaden our reach and to make more funding available through additional efforts with the feds and others."
While Maglaras is confident he can deliver a credible company, he did tell homeowners that this undertaking is one of the biggest and most consequential of his career.