HomeHome InsuranceIncentive fund legislation advances at Louisiana insurance special session

Incentive fund legislation advances at Louisiana insurance special session

BATON ROUGE, La. (WVUE) – State lawmakers advanced two bills Tuesday (Jan. 31) that realtors and insurance agents hope will improve Louisiana’s insurance landscape.

After hours of discussion, the House Appropriations Committee sent House Bills 1 and 2 to the full House of Representatives.

Kim Calloway of Louisiana Realtors testified before the committee on the second day of the special legislative session, explaining how higher premiums are impacting homebuyers.

“The cost and unavailability of property insurance is killing the real estate market,” Calloway said. “Your constituents might be able to buy, but they can’t afford to own, because of those costs.”

Lawmakers said even they are not immune to the higher insurance rates and the fallout from insurers failing financially after Hurricanes Laura and Ida. Rep. Tim Kerner (R-Lafitte) said his insurance premium has skyrocketed.

“My premium went up from $6,000 to $18,000,” Kerner said, “and it’s happening all along south Louisiana. People can’t pay it. The only game in town is what you’re bringing to the table today and we’ve got to do something.”

Insurance Commissioner Jim Donelon again urged lawmakers to put $45 million into an incentive fund to lure more insurers to the state.

“I truly believe that, if we do not do this, thousands of homeowners below I-10, I-12, are going to lose their homes,” Donelon said. “Turn in the keys, can’t afford the coverage.”

Donelon said eight insurers failed financially and some others stopped writing wind and hail policies after the hurricanes of 2020-21. The result was 125,000 customers needing to obtain policies from Louisiana Citizens, the state’s insurer of last resort.

HB 1 places $45 million into the incentive fund, but also mandates that only insurers rated of certain financial strength get the state grants.

HB 2 prohibits participation in the program by some companies.

That bill’s author — Rep. John Stefanski (R-Crowley) — said, “What I wanted to make sure wouldn’t happen is prior people who were in the market writing homeowners’ insurance, who declared bankruptcy or (were) ruled insolvent, coming back into the market.”

Some Louisiana homeowners still are dealing with Hurricane Ida damage and insurance claims still unpaid. Rep. Chris Turner (R-Ruston) questioned Donelon about that.

“What penalties are we putting on these companies that are slow-rolling existing claims?” Turner asked.

Donelon replied, “There’s plenty of penalties in the law already — two different sets of penalties in the law for slow-rolling claims.”

“What are they?” Turner asked.

“I don’t have it in front of me,” Donelon replied.

Donelon’s chief of staff Denise Gardner told the committee that at least 10 insurers have expressed interest in the proposed incentive program. Among those she named were Allied Trust, Centauri Group, CURE (Cajun Underwriters Reciprocal Exchange), Elevate, Safe Point and Sure Choice.

The full House could take up the two bills on Wednesday.

See a spelling or grammar error in our story? Click Here to report it. Please include the headline.

Source link

latest articles

explore more