BATON ROUGE, La. (BRPROUD) — Heading into the new administration, lawmakers will be tasked with addressing the insurance crisis. The incoming insurance commissioner already has ideas on things he wants changed but some advocates are concerned with some of the ideas he has in mind.
Insurance Commissioner-elect Tim Temple is getting a group of industry leaders together to start figuring out ways the state can bring down the cost of homeowners insurance. The group is made up of people who work in the industry for auto, home, life and commercial insurance. He hopes they can start addressing the key issues for the industry that can be changed by the commissioner or legislature.
“We only have a handful of companies that are willing to write homeowner’s policies in the state of Louisiana. We want to encourage those companies to come back,” Temple said. “And if you go and tell somebody, ‘Come to Louisiana, write business and I will let you know when you can raise your rates.’ You have to kind of put that in perspective.”
Temple said Louisiana has to start regulating like surrounding states. For example, he’s also for altering the three year rule that makes it harder for a company to drop a policy. This has come up in the past but often hits a snag with legislators who represent the districts along the coast.
“The senators and the representatives are standing up on behalf of their constituents who do not want to make it easier for insurance companies to delay and deny claims,” said Ben Riggs, executive director of Real Reform Louisiana. “They don’t want to make it easier for insurance companies to kick them off of their books and force them onto citizens where they’re going to suffer an immediate and instant price increase.”
Temple said he understands that concern but is open to finding alternatives to the law without completely removing it.
“I’m not suggesting that you just do away with it. I think that would create more that would create more near-term turmoil in the marketplace if we were just to rip that Band-Aid off,” Temple said.
Consumer advocates think it’ll still hurt homeowners to change those regulations. Policyholders have already seen major increases to the premiums and fear it could become harder to get a payout from their company when they need it.
“Insurance companies are not standing at Louisiana’s border ready and eager to take on the risks that come with those major storms to take advantage of these small regulatory changes,” Riggs said.
He believes the state needs to work on mitigating risks to reduce the extensive damage from increasingly dangerous and frequent storms that take aim at Louisiana.
“We need to mitigate risk. For example, the fortified roof program is one way to help reduce that risk,” Riggs said.
Temple is not sold on keeping the fortify roofs program running indefinitely, but rather would establish a tax credit for people taking the initiative to fortify their homes.
He is open to a number of ideas on how to tackle the insurance crisis. He is in support of a special session to target a select few regulations. Temple is still waiting to get the green light from Governor-elect Jeff Landry for that session. If it is to take place, he would like to have it in January to make any changes long before hurricane season starts in the next year.