Henderson talks auto, dwelling insurance coverage at Chamber lunch

Louisiana is making progress towards controlling dwelling insurance coverage premiums, however auto insurance coverage protection is proving to be a harder problem.
That was the phrase Wednesday from Deputy Insurance coverage Commissioner Ron C. Henderson, a Charenton native who has household in Morgan Metropolis, at a St. Mary Chamber Enterprise Luncheon on the Petroleum Membership.
Hurricane-prone Louisiana, particularly after a sequence of direct hits by main storms starting in 2020, is paying dwelling insurance coverage premiums 5% greater than the nationwide common, in response to the Financial institution Fee web site. However think about will increase anticipated due to Danger Ranking 2.0 and the rising price of flood insurance coverage, and the state of affairs is worse than the numbers point out.
And auto premiums for full protection, typically required for a brand new automobile mortgage, are a 3rd greater in Louisiana than the nationwide common, additionally in response to Financial institution Fee.
The chance for owners isn’t nearly premiums. Henderson stated the state misplaced 45 dwelling insurers in recent times. That features 10 that went out of enterprise and 30 that stopped writing insurance coverage right here.
That places upward strain on premiums as a result of it reduces competitors, Henderson stated.
“When you’ve got one loaf of bread on the shelf, what’s that going to price?” Henderson stated. “Regardless of the heck they need.”
However 10 extra corporations have determined to put in writing insurance coverage right here inside the final 12 months. Premiums that had been going up by 16-17% in 2023-24 went up solely 3-6% final 12 months, Henderson stated.
He credited the acquisition of the ten new insurers to final 12 months’s repeal of the so-called three-year rule. That rule prohibited corporations from elevating deductibles or canceling insurance policies that had been in impact for 3 years.
The modified rule permits corporations to cancel as much as 5% of their prospects. However Henderson stated corporations taking such motion are required to file a plan.
“We haven’t seen a plan but from any firm,” Henderson stated.
One remaining thorn is Danger Ranking 2.0, a comparatively new system wherein flood insurance coverage danger is assessed primarily based on the traits of particular person properties, not on bigger areas similar to ZIP codes.
The phrase from the Federal Emergency Administration Company is that almost all owners are seeing their premiums keep the identical or go down. However 30% are seeing will increase, generally massive will increase.
Henderson stated his workplace has been attempting to pay money for the components FEMA makes use of to evaluate the danger for particular person properties. However FEMA is withholding the components, citing its proprietary nature, Henderson stated.
Henderson’s boss, Insurance coverage Commissioner Tim Temple, has been concerned in some high-profile disputes with Gov. Jeff Landry over strategies for decreasing auto insurance coverage premiums.
Temple has disagreed with Landry proposals similar to giving the commissioner the ability to reject premium will increase seen as extreme. Temple says he already has the ability he wants.
They’ve additionally disagreed over Landry proposals similar to capping lawyer charges and limiting harm awards.
However when he opened this 12 months’s legislative session, Landry talked in regards to the want for each trial attorneys and insurance coverage corporations to bear among the ache. And there appears to be settlement on that time.
“It’s not simply the legal professionals,” Henderson stated. “It’s not simply the businesses. It’s the entire ecosystem.”