Insurance dominated Louisiana’s 2024 legislative session, with lawmakers and the newly elected Insurance Commissioner seeking to address the state’s property insurance crisis. 

After steadily rising over several years, insurance costs skyrocketed across the state after hurricanes Laura, Delta, Zeta, and Ida inflicted damage to hundreds of thousands of homes across South Louisiana in 2021 and 2022. The resulting property insurance claims and concern about the increasing frequency and intensity of severe wind events resulted in several insurance companies failing, and others stopped writing homeowners' policies or doing business in the state entirely. 

Insurance affordability and availability are both major problems for Louisiana homeowners and rental property owners. Many property owners are unable to get insurance companies to even offer them a policy, and those who can secure private insurance coverage face severe premium increases. 

Those who cannot find private insurance are forced to go to the Louisiana Citizens Property Insurance Corporation, the state insurer of last resort, where they face premium costs that are statutorily mandated to be more expensive than the highest premiums offered by private insurers. 

Newly elected Insurance Commissioner Tim Temple entered his first legislative session with the goal of increasing insurance affordability and availability by making Louisiana’s insurance regulatory climate more business-friendly with the hope of coaxing more insurers to write policies in the state. A series of bills backed by Temple were introduced that aimed to roll back or loosen regulations on insurance companies.  

Support for the most contentious bills often fell along partisan lines, with Republicans, insurance companies and trade groups lining up to promote the bills, and Democrats, housing advocates, and consumer-protection organizations opposing. Ultimately, the Republican majority was able to pass many of these measures, including:

  • House Bill 611 by Rep. Gabe Firment, the highest-profile bill in the commissioner’s agenda, removes the “three-year rule” which prohibited an insurance company from dropping homeowners it had insured for three years except under certain circumstances. The new law will remove the three-year requirement for new homeowner policies and policies in place less than three years. For policies currently in place for three years, insurance companies will be allowed to nonrenew up to 5% of total policies each year or more than 5% with the approval of the Insurance Commissioner. 
  • Senate Bill 295 by Sen. Heather Cloud makes it easier for insurance companies to raise rates by reducing to 30 days from 45 days the waiting period for rate increases to go into effect after filing with the Insurance Commissioner.  
  • Senate Bill 323 by Sen. Kirk Talbot gives insurance companies more time to settle claims and reduces penalties that may be assessed against insurance companies when found not acting in good faith. 
  • House Bill 701 by Rep. Kim Carver creates a “regulatory sandbox” that will allow insurance companies to seek regulatory waivers for the introduction of insurance products deemed innovative or efficient. 

However, lawmakers also introduced a number of insurance bills aimed at placing more limits on insurance companies and protecting policyholders, of note: 

  • House Bill 375 by Rep. Mandie Landry was passed. It requires insurance companies to clearly disclose all discounts available to consumers for their homeowner’s and vehicle policies.  
  • House Bill 520 by Rep. Gabe Firment was passed. It specifies that insurers withholding repair estimates from insureds on a routine basis will be considered a deceptive or unfair practice. 
  • House Bill 524 by Rep. Matthew Willard would have offered Louisiana Citizens policyholders a reprieve from the statutorily mandated 10% surcharge on their insurance premiums, but the bill failed to pass through committee. Rep. Matthew Willard argued that suspending the surcharge was justified because most policyholders had no choice but to accept a Citizens policy as no other company would insure them. 

In addition to loosening regulations, Louisiana lawmakers eyed the FORTIFIED building standard to strengthen homes from wind risk and lower insurance costs. The Louisiana Fortify Home program, created by the legislature last year and administered by the Louisiana Department of Insurance, provides $10,000 grants to eligible homeowners to upgrade their roofs to the FORTIFIED Roof standard created by the Insurance Institute for Business & Home Safety (IBHS). FORTIFIED Roofs are designed to keep a home’s roof intact during a hurricane, tornado, or other high-wind event, thus significantly minimizing damage to the home. 

House Bill 120 by Rep. Matthew Willard extended the Fortify Home program by repealing the termination date imposed in the initial legislation. Lawmakers also added $15 million to the program after initially allocating $30 million last year.

Senate Bill 484 by Sen. Royce Duplessis attempted to guarantee more results from the program by mandating that insurance companies provide discounts for homes with FORTIFIED Roofs. The idea was inspired by the state of Alabama’s efforts in incentivizing FORTIFIED Roofs and requiring insurers to offer discounts for them. 

Ultimately, legislators rejected the discount mandate but did approve other portions of Senate Bill 484 that allow the Department of Insurance to partner with local governments and nonprofits in administering the Fortify Home program. Many homeowners have found that the cost of FORTIFIED Roof retrofits exceed the $10,000 offered through the program, and this legislation will allow other resources to be added to fill those gaps.

We appreciate the efforts of lawmakers and advocates working to address the state’s insurance crisis in the 2024 legislative session. We will continue to work toward a more affordable insurance landscape in Louisiana throughout the year and in anticipation of next year’s legislative session.