Trying to hold back insurance costs in La.
Published 11:00 am Wednesday, April 5, 2023
The Louisiana Department of Insurance will be taking more steps to regulate insurance premiums in the state during the upcoming legislative session.
One such step will be to fund the Louisiana Fortify Homes Program.
This legislation, which was passed last year but not funded, will provide qualifying Louisiana homeowners, in most cases, with grants to fortify their roofs to withstand severe weather “using methods that meet or exceed the fortified home standards of the insurance institute for business and home safety.”
Louisiana State Rep. Mike Huval, R-Grand Bois, believes this program will help mitigate home damage and loss during hurricanes.
“One of the best ways we can prepare is to use stronger materials and construction methods when building and modifying our homes,” he said.
During the upcoming legislative session, they are looking to secure $20 million to fund the program. Huval stated that once the program is funded, it should “get underway rather quickly.”
Participating homeowners will need to meet eligibility requirements and pay for permits, inspections and similar fees.
The LDI is also presenting legislation that would mandate that insurance companies provide justified discounts or credits to policyholders who build or retrofit their homes to meet fortified standards.
In 2021, Act 30, which allowed insurance companies to provide such discounts, was passed.
“This will insure policyholders that are putting in the time, money and effort to build or retrofit their structures to fortified standards are reaping all the benefits of that decision.”
The LDI will also be seeking an additional $20 million for the Insure Louisiana Incentive Program – which financially incentivizes insurance companies to write new business in Louisiana to offset the insurance crisis that Louisiana has faced in the wake of the 2020 hurricanes Laura and Delta.
“The idea is to get these policies out of Citizens as quickly as possible, and as we saw after Katrina, it will attract other companies to come in and start writing as well,” said State Sen. Kirk Talbot, R-River Ridge.
The need for this program resulted from “unprecedented combination of back-to-back catastrophic hurricane seasons and a legal environment that led to a greater crisis in Florida… as well as a global reinsurance shortage that hit us all at the same time, which paralyzed the industry and led to the failure of nine insurance companies doing business in our state,” said Jim Donelon, Commissioner of Insurance for Louisiana.
The LDI will be distributing $42 million to the eight insurers that applied and were approved for funding by the joint legislative budget committee. This will lead to nearly $170 million in new premiums, at least half of which will be written in southern Louisiana, according to Donelon.