NU Online News Service, July 6, 3:30 p.m.EDT

The task of John Wortman, who has announced his retirement, wasnot an easy one when he was hired as the new chief executive ofLouisiana's homeowners insurer of last resort.

Upon Mr. Wortman's arrival in April 2007, Louisiana CitizensProperty Insurance Corp. was in "great turmoil," said LouisianaInsurance Commissioner Jim Donelon. The insurer was plagued by newsof misappropriations, mismanagement, a failing policy and claimssystem, and thousands of claims left from hurricanes Katrina andRita.

Not to mention, Citizens was overgrown. Following Katrina andRita in 2005, the state-run insurer had more than 170,000 policiesby early 2008.

Mr. Wortman hired a new management team and "spent the next yearoverhauling Citizens from top to bottom to ensure a stable propertyinsurance market of last resort," said Mr. Donelon.

New computer systems, application and underwriting procedures,catastrophe management plans, and a depopulation program are alldue to Mr. Wortman, said Mr. Donelon.

"All these things–they don't get accomplished without a lot ofhard work from a lot of people," said Mr. Wortman, who ran aconsulting firm prior to joining Citizens. "I am very pleased andproud. I believe the competitive market is better than it was."

Citizens now has 127,000 policies after three rounds ofofferings to the private insurance market as part of thedepopulation program. The insurer closed 63,640 of 66,490 Katrinaclaims, paying out about $1.37 billion.

The insurer also has more money thanks to Mr. Wortman, accordingto Mr. Donelon. In refinancing some bonds, Mr. Wortman savedCitizens $15 million per year and then used his reputation in theinsurance industry to get a bond that allowed Citizens to pursuethe appeal of a class-action lawsuit against it, Mr. Donelonsaid.

This was one of the most important contributions Mr. Wortmanmade, Mr. Donelon said, noting that if Citizens had not been ableto appeal the class action suit, policyholders would have beenassessed to help pay for the damages.

Mr. Wortman said he will remain with Citizens until a successoris named to make certain of a smooth transition.