NEW ORLEANS — The Louisiana Legislature passed a series of so-called insurance reform bills during the recently wrapped regular session.
The new laws make it easier for insurance companies to drop policyholders and raise rates.
They will also have more time to pay claims after a storm
“I’m acutely aware of what’s taking place in Florida,” LA Insurance Commissioner Tim Temple said. “Some of the legislation that we passed this session was modeled on what Florida did.”
Reforms in Florida are now paying dividends after years of dramatic increases in the cost of coverage.
“We have seen an amazing turnaround in the Florida property insurance market,” Insurance Information Institute spokesman Mark Friedlander said.
Florida's Office of Insurance Regulation is reporting that 19 insurance companies in the state are either seeking a rate decrease or no increase for 2024.
Eight new insurers have also come into the state.
“It shows that reform works,” Temple said. “Florida undertook their insurance reform, they did three, four special sessions in three years in 2022 and 2023. We’re in 24 and we’re seeing the positive impacts of that.”
After devastating hurricanes hit Louisiana in 2020 and 2021, a dozen insurance companies in the state went out of business.
Other insurers left the state and are no longer writing policies here.
Sen. Kirk Talbot, R-River Ridge chairs the Senate Insurance Committee.
“It’s good to see we have a state not far from us that’s in the same peril, hurricane ally as we’re in,” Talbot said. “They passed things a couple of years ago and now we can see how those things translate into lower rates.”
In Florida, tort reform aimed at curbing abusive litigation practices is getting much of the credit for helping to stabilize the insurance market.
In Louisiana, lawmakers pushed back on bills to change how and when policyholders can sue insurers.
“We didn’t make a lot of progress on legal reform and that’s one I’m not giving up on.
Friedlander said actions taken by the Louisiana Legislature this year were strong, but more work is required.
“Without truly addressing legal system abuse straight on with tort reform legislation it’s very challenging to eliminate those problems in the marketplace.”
State leaders say they will continue to watch how the market responds to reforms in Florida, hoping to get the same results in Louisiana.
“Obviously, some of the things they’re doing over there are working,” Talbot said.
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