BATON ROUGE, La. — Newly-elected Tim Temple, who succeeded longtime Commissioner of Insurance Jim Donelon (2006-2024) following retirement, wasted no time addressing Louisiana's growing insurance crisis while speaking at a business luncheon in Baton Rouge on Wednesday.
"Louisiana is the most unaffordable state in America for insurance," Temple began. "That means we spend more of our hard-earned dollars on insurance than any other state.
"Those of you trying to recruit people to come to Louisiana and work are facing the challenge of telling somebody 'move to our state, and your auto insurance doubles. Move to our state, and your homeowner's insurance is going to triple.'"
Temple said the challenges residents and business owners are facing are currently insurmountable, but that the Department of Insurance is working diligently on producing change.
"We understand the importance that that unaffordability plays in your success as a business. And like I said, we're working ... to help bring about some change there."
Temple also addressed the impact of four hurricanes, starting August 2020 with Laura followed by Delta, Zeta and Ida, two of which were the strongest ever recorded in Louisiana in a 12-month period.
"800,000 property claims, $23 billion paid or reserved on a book of business that collected $2 billion," explained Temple. "For the CFOs in the company, you know what that means? You know, you collect two and you pay out 23.
"The market's upside down right now."
According to Temple, despite many insurance companies around the state having financial reserves and proper levels of reinsurance purchased, there were a lot that did not.
"We had 12 companies go insolvent, over 100,000 claims have now gone from the standard market to Louisiana Citizens – the market of last resort, the one that you and I all own together as citizens. So there's a bit of a challenge there on the homeowner side."
Temple also addressed concerns over the commercial trucking crisis.
"The logging industry, for example, get quotes of $25,000 per unit from only one insurer that's willing to write the risk," Temple said. "The men and women that operate those, they can't drive those vehicles long enough, fast enough, hard enough to make money to pay for the insurance much less maintenance, fuel, employee costs, trying to put a little bit back for their business and themselves. It's strangling the economy in our state."
"And that's just the logging industry," he added. "It applies to any and every business that drives a truck."
Temple then outlined what he called a few basic facts:
- Insurance is a promise to pay, and insurance companies are in the business of paying claims
- Litigation should never be a substitution for the claims process
- Insurance companies don't have to do business in Louisiana
- Insurance companies have to make a profit so they do not go insolvent
"We've got a governor that's going to help with reform as regards to abuse of the legal system, Temple said. "But what we're trying to do is moderate the increase. And once we can moderate the increase and start to get it level, and these companies start to come back in, that's when that availability will drive the affordability number down, and that's what we want, and that's what we need."
Watch the complete address from Landry and Temple below:
Temple (R) followed Gov. Jeff Landry (R) at the Louisiana Association of Business and Industry at the Baton Rouge Crown Plaza.
During the keynote address, Gov. Landry signed an executive order on the conditions for participation in the state's industrial tax exemption program.
Gov. Landry's keynote address came on Day 3 of the state's special session on crime.
The annual luncheon followed a morning leadership panel led by Senate President Cameron Henry (R) and Louisiana Speaker of the House Phillip Devillier (R).
LABI is the official state chapter of the U.S. Chamber of Commerce and the National Association of Manufacturers.
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