Louisiana insurance special session underway

MONROE, La. (KNOE) - The special session to address the Louisiana insurance crisis began on January 30th.

Lawmakers are being asked to put $45 million in an incentive fund to attract more businesses to the state, but only some are on board.

Louisiana Housing, a non-profit that works to improve affordable housing in the state, says the proposal is not guaranteed to fix Louisiana’s problems.

“We are worried that even if insurance companies come back, they won’t help the people who desperately need to be helped,” Andreanecia Morris, Louisiana Housing’s Executive Director, told KNOE.

Morris says she’s against Insurance Commissioner Jim Donelon’s proposal to allocate $45 million to an incentive fund to encourage companies to write more policies in Louisiana because it doesn’t include specific requirements.

“That they set up qualifications for who this is intended to,” said Morris. “That you’re looking at someone who is now struggling, who is not cost-burdened, spending more than 30% of their income on their total housing costs.”

Commissioner Donelon says incentivizing companies will lower premiums for all residents, including people who are low to moderate income.

“These policyholders, for the most part, are blue-collar, hardworking folks,” Donelon told KNOE.

Donelon adds his plan is designed to reduce the number of policies on the books of Citizens Insurance, the state-funded insurer of last resort. He says this will drive down rates and protect residents from paying fees like they currently do because of Hurricane Katrina.

“The fewer policies they have, the less reinsurance is necessary in order to protect against the need to assess or, worse yet, borrow money through another bond issue assessment on every property insurance policyholder statewide,” Donelon explained.

Both Donelon and Morris agree the plan is a short-term fix. Long-term, the state needs to improve its resilience.

“We have got to improve our housing stock,” said Morris. “We have got to make our homes able to withstand the next sets of hurricanes, tornadoes, and winter events that are no standard in Louisiana. Those homes have got to be stronger.”

Donelon is hoping legislators will allocate money to the “Fortify Homes Program” during this year’s regular session to improve Louisiana’s resilience.

Copyright 2023 KNOE. All rights reserved.