Days after Louisiana Citizens filed for a 63-percent rate hike on its homeowner policies, Louisiana Insurance Commissioner Jim Donelon says he's working one ways to help homeowners stuck in the middle.
"Tomorrow, I'll be in the joint legislative budget committee advocating for funds that we have in our budget to replicate what we did post-Katrina," Donelon told WWL's Tommy Tucker.
Donelon says those funds will be used to attract insurance providers to Louisiana and take policies out of the market of last resort though "an incentive bonus that they have to match and they have to write just as much in new premium in our state."
Donelon noted that this method worked successfully after Hurricanes Katrina and Rita, taking a load off the Louisiana Citizen's Insurance Program. Donelon says back then, private insurers took nearly 140,000 policies out of the state's insurer of last resort.
"We attracted 30 small regional companies insured up to their chins to come fill the void left by those exiting major national carriers," Donelon said. "We did it then. We're going to do it again."
If other providers pick up those policies, the policyholders could see their rates drop.
"For the companies, it's a matter of attracting them to our market, convicing them that they can do business profitably in our state as they have for years," Donelon said.
According to Donelon, 61 percent of current homeowner policies are covered by private companies.