Despite frustrations over no other options, insurance incentive fund advances
BATON ROUGE, La. (BRPROUD) -- Legislators in the third day of the special legislative session looked to incentivize insurance companies to come to the state.
The key bill of the session passed the full House Wednesday, but with many still having reservations.
The objective of the session is to put $45 million into the Insurance Louisiana Incentive Fund. It will be used to write grants to insurance companies to draw them to write policies in the state.
While the bill passed overwhelmingly, a number of representatives spoke of their frustrations about there not being more options being pursued on how to handle the insurance crisis. The Insurance Commissioner Jim Donelon has said throughout the special session that the incentive fund is the best option for short-term relief, but lawmakers are upset that more focus isn’t being put on other avenues to give long-term insurance relief.
“I have not seen any options other than this being plan A, plan B, plan C, and D,” said Rep. Chad Brown, D-Plaquemine.
The commissioner is estimating about 40,000 people will be taken off the Louisiana Citizens' roll. He bases it on how many were taken off after Hurricane Katrina. Plus, an amendment was added that requires companies who utilize the grant fund to have 25% of their new policies off of Citizens. Some are skeptical of the commissioner’s estimates, bringing relief to a large group of people.
“While you’re giving hope to 100% of the people that are seeking relief, there is a very small percentage in reality that is going to benefit from this and folks that’s the data,” said. Rep. Edmond Jordan, D-Baton Rouge.
The commissioner says there are 10 companies interested in the fund, seven of which already write in the state and are looking to expand their books. He says once more companies roll in, it will encourage others to follow suit. He points to a similar process happening in the post-Hurricane Katrina program. Lawmakers still are pushing for more long-term solutions even if they cannot be voted on in the limited special session.
“If you live below I-10/I-12 this is probably the only hope we have right now. The next hope is we come back in the regular session and really fix this issue,” said Rep. Jerome Zeringue, R-Houma.
Some legislators are feeling the sting of rising premiums alongside their constituents. While they agree it is only a short-term fix, they are willing to try and bring relief even if it is for a few. Donelon has said multiple times in the session that he fears thousands of Louisianans are teetering on the edge of losing their homes.
“Any Citizens policy that is being renewed is going to increase by at least 63%. Mine increased by 164% over last year. Not everybody is going to be able to afford that increase,” said Rep. Beryl Amedee, R-Houma.
Other amendments to the bill were proposed but since the call of the session was so narrow, they could not be allowed to be added. One looked to transfer any unused money from the fund at the end of the fiscal year into the Fortify Homes Program, but it was ruled not germane to the call of the session.
On Thursday, the state Senate will get its first shot at debating the bill in Senate finance.