A bill to remove approval from the Insurance Commissioner for rate changes passes in the full House.
Rep. Mike Huval (R-Breaux Bridge) said some people think allowing the commissioner to control rates is a good thing, but he says it actually hinders competition among insruance companies.
“The prior approval regulation has not resulted in reasonable insurance premiums. Where there is not a healthy competition between insurance the price goes up,” said Huval.
Huval believes a free and competitive insurance market will regulate prices better than government bureaucracy and regulation.
Insurance Commissioner Jim Donelon, who’s not seeking reelection, opposes the bill, and Rep. Mandie Landry (D-New Orleans) is skeptical of the legislation.
“I think if people in my district suddenly received a huge rate increase overnight and heard that the department couldn’t do anything about it, I think it would make people in the state even more irate,” said Landry.
Huval said 30 days after a rate goes into effect it can be reviewed and about two months later, if deemed unlawful, can be repealed.
“This bill will still allow the Commissioner of Insurance to disapprove filings that are unfairly discriminatory or violate Louisiana law,” said Huval.
House Bill 489 passed on a 56 to 23 vote and is headed to a Senate committee.
