Drastic Increase in Insurance Premiums Approved by the Louisiana Department of Insurance
Ten of thousands of people in Louisiana will see the cost of their insurance for their homeowner policies go up drastically.
Officials with the Louisiana Department of Insurance say it was necessary to increase rates for homeowners' policies by 63% so the state's insurer of last resort will stay solvent.
The question on many people's minds is how am I going to pay for this? People's budgets are already strained with what they currently pay for insurance, plus the rising cots of goods and services have impacted everyone's budgets.
If you have Louisiana Citizens which is backed by the state of Louisiana that you are going to likely see a drastic increase in the amount you pay for your policies after January 1, 2023
Why Are Insurance Policies from Citizens Going Up So Much?
When we interview Donelon several weeks back he said several insurance companies will no longer insure people whose property sits below I-10 and I-12. The state has seen so many storms in the last few years that many companies simply would not take the chance to insure properties. When those companies refused to write those policies anymore, the only option left for people was Louisiana Citizens.
What Do I Do If I Have Citizens' Insurance?
Insurance Commissioner Jim Donelon says the best thing you can do is start calling companies to ask for a quote. By law, Citizens Insurance must have premiums 10% higher "the highest qualifying market rate or 10% over the actuarial rate, whichever is higher."
This was provided for in the law so that private insurance companies would still be able to compete in the insurance marketplace. Now, with so many insurance companies leaving Louisiana, Louisiana Citizens can't stay solvent without drastically driving up their prices.
There had been so much damage for homeowners in Louisiana due to the following storms:
- 2020 Hurricane Laura
- 2020 Hurricane Delta
- 2020 Hurricane Zeta
- 2021 Hurricane Ida
Many of the people impacted by these storms will still need insurance, and if they already have Louisiana Citizens, their premiums will go up 63% after January 1. The new increase takes effect as soon as your policy renews after the new year.
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