Top Louisiana legislator Tanner Magee undecided on supporting incentive package for insurers

NEW ORLEANS (WVUE) – The particular legislative session on Louisiana’s insurance coverage disaster is lower than per week away, and the No. 2 chief within the state Home of Representatives will not be able to say he’ll help the lone merchandise on the agenda.

Home Speaker Professional Tem Tanner Magee (R-Houma) says too many essential questions stay unanswered earlier than state lawmakers convene subsequent Monday (Jan. 30) to think about whether or not to position $45 million into an incentive fund for insurers.

“I’m on the fence,” Magee advised Fox 8. “I would like extra data (from Insurance coverage Commissioner Jim Donelon). I’m not a ‘no.’ However I’m not a ‘sure,’ but, both.”

Donelon says monetary incentives are wanted to draw extra insurers to the state. He says eight insurance coverage firms failed within the aftermath of Hurricanes Laura, Delta, Zeta and Ida.

Magee stated, “I believe that as a part of my due diligence as a legislator is to search out out all these questions on what firms are we , who can we actually anticipate to get in earlier than this time interval and the way a lot cash is it actually going to require? I’m involved that $45 million is basically not sufficient to carry an actual insurance coverage firm into the state of Louisiana.”

Magee stated he believes the state ought to take steps to make sure that insurance coverage firms working in Louisiana are adequately capitalized in case of main hurricanes.

“I believe it’s a two-step factor,” Magee stated. “We have to be sure that they’ve a minimal capitalization, so far as having sufficient cash at the very least to pay a good quantity of claims out to all people. I additionally assume we have to mandate what ranking businesses are getting used to price these insurance coverage firms, as a result of there’s a number of fly-by-night ranking firms. … I believe there’s extra industry-standard ones that we might use.”

In the meantime, insurance coverage premiums within the state are rising.

Dave Clements, co-owner of Clements Insurance coverage Companies in St. Bernard Parish, stated, “We’re seeing will increase of 40%, 50%, 70% and even 80% in some instances.” He stated it’s a problem to search out cheaper insurance coverage.

“The insurance coverage firms are simply taking a shellacking,” Clements stated. “They’re spending billions and billions of {dollars} making an attempt to get folks again of their houses. So, sadly, these prices are simply going to get handed on to the shoppers. It’s been a problem and sadly not sufficient time has handed for these costs to return again down.”

Clements stated the few insurance coverage firms which can be writing Louisiana insurance policies are being very selective about which properties they cowl.

“There are a number of firms, however they’re few and much between, and their necessities have modified,” Clements stated. “They’re requiring a sure stage of ‘Protection A’ and also you have to be at the very least $250,000. They’re requiring that your roof solely be 5 years outdated. And a few folks simply don’t meet these necessities. However the firms have the power to be restrictive on who they’ll write, as a result of they’re solely going to take the best-of-the-best enterprise proper now.”

Magee stated a lot of his constituents had been impacted by insurer insolvencies.

“They filed chapter and left the state,” he stated of the businesses. “And on the finish of the day, LIGA — which is a state entity — is the one who’s choosing up the tab on it. And so I believe lots of people are hesitant to leap again into what I believe is greatest described as fly-by-night insurance coverage firms once more, only for the sheer sake of doing it within the look of getting low cost insurance coverage, which all of us need.”

Magee stated he expects insurance coverage reform to return up in the course of the common legislative session which begins in April.

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