Date Published: February 7, 2007   

Senator nominated to run S.C. Insurance Department

By JIM DAVENPORT
Associated Press Writer

Worried about a coastal insurance crisis driven by the threat of hurricanes, South Carolina Gov. Mark Sanford on Wednesday picked a senator from Hilton Head Island to run the state Insurance Department.

Sanford nominated Sen. Scott Richardson, a former insurance company owner who now runs a real estate company, to replace Eleanor Kitzman, who resigned after pressure from the governor.

Richardson and Sanford agree the state agency should regulate less and allow private insurers to work out many of the insurance problems along the coast.

Insurers are currently dumping policies and raising premiums along the coast, leaving tens of thousands property owners uninsured in hurricane-prone areas. Others are struggling just to afford insurance.

Richardson's appointment must be confirmed by the Senate. He said he won't resign from the body until that happens, which could be in the next few weeks.

The pressure for Kitzman to step down was primarily "determined by what's happening in coastal insurance," Sanford's spokesman Joel Sawyer said.

Kitzman lately had argued the state's wind insurance pool should be expanded, which she said would help some coastal property owners. Sanford had questioned whether the move was necessary or legal but the disagreement didn't cost Kitzman her job, the governor said.

Kitzman headed the state Insurance Department for two years. She was tapped by the Republican governor as a businesswoman who could increase competition and help consumers pay less. The agency oversees almost 2,000 companies doing business in the state.

Kitzman, who was paid $100,000 a year, sent an e-mail Tuesday to agency workers, saying it was a difficult decision to make.

"I advised Gov. Sanford today that I was resigning as Director of Insurance," Kitzman said in the e-mail provided to The Associated Press. "I agreed to remain until the end of the legislative session or until a new director was confirmed and there was an orderly transition."

Coastal insurance isn't the only issue Kitzman has faced. Legislators questioned her leadership last year in the midst of debate on overhauling the state's workers' compensation system.

Sen. Gerald Malloy, D-Hartsville, pushed legislation that called for the Senate Banking and Insurance Committee to study whether the agency was operating efficiently and protecting public interest. He renewed those calls Wednesday.

His efforts last year helped stall a workers' compensation overhaul that both Kitzman and Sanford pushed.

Kitzman has worked in the insurance industry for two decades. She founded Driver's Choice Insurance Services in 1999 and sold the business in 2002.

Sawyer said Richardson's salary had not been set.