Real Reform’s 2022 Bipartisan Insurance Reform Agenda
By Eric Holl, Executive Director
Louisiana is in an insurance crisis. The legislature ignored the cries of victims of Hurricanes Laura and Delta and refused to pass significant insurance reform in the 2021 legislative session. Just a few months later another Category 5 storm, Hurricane Ida, struck our state. Now the people of Southeast Louisiana are languishing in the same insurance purgatory that Southwest Louisiana families have been stuck in for 18 months.
To make matters worse, the 2020 tort reform legislation that the insurance commissioner and corporate lobbyists promised would lower auto insurance rates by 25% has proven to be an abysmal failure. Instead of going down, our auto insurance rates have skyrocketed 19%, and Louisiana has become the most expensive state in the country for auto insurance.
Luckily, it is not too late to fix our broken insurance system and end the abuse of policyholders. Strong, meaningful insurance reform legislation has been introduced by a bipartisan group of legislators. All of it is commonsense legislation focused on creating transparency in the claims process, making insurance companies play by the rules, and increasing penalties on bad actors. Any insurance company currently conducting their business with decency and respect will be minimally impacted by this proposed legislation.
See below for a statement from Real Reform Louisiana Executive Director Eric Holl, followed by the full list of legislation Real Reform Louisiana is supporting and opposing as filed.
“We would like to thank Sen. Jeremy Stine, Rep. Ed Larvadain, Rep. Matthew Willard, Rep. Tanner Magee, Rep. Kyle Green, Rep. Edmond Jordan, Sen. Jay Luneau and the many other legislators who are standing up and fighting for policyholders. We would also like to thank Governor Edwards for including insurance reform in his legislative package. Thanks to this bipartisan group of leaders, Louisiana may finally get the insurance reform our people desperately need. The people of Louisiana are watching, and Real Reform Louisiana will be informing the public of how their legislators vote on this crucial legislation.”
SUPPORTED LEGISLATION:
Property Claims
- SB208 (Stine) — Increased penalties for bad actors. The main incentive insurance companies have to not cheat their policyholders—besides basic decency—is the threat of bad faith penalties that can be awarded if a court of law finds that the insurance company wasn’t following the law or their contract. Theoretically, bad faith penalties are supposed to be the deterrent that stops bad behavior by insurance companies. Clearly, the current penalties we have aren’t working, and must be strengthened. This legislation would do so. It would also add further increased penalties if an insurer is operating in bad faith and dragging out a claim for an extended period of time, in an effort to end the endless delay tactics insurance companies use to exhaust and frustrate hurricane victims. [Note: Similar legislation is expected to be filed in the House by Rep. Ed Larvadain, which Real Reform will also support]
- HB268 (Magee) and HB558 (Willard) — End insurance purgatory. Right now, insurance companies are required to pay claims shortly after receiving ”satisfactory proof of loss.” Unfortunately, insurance companies abuse that legal language, arbitrarily insisting they haven’t received “satisfactory proof of loss” for months on end in order to drag out claims and wear down desperate hurricane victims. These bills would limit the amount of time insurance companies have to obtain “satisfactory proof of loss” to stop the endless delays and end insurance purgatory.
- HB316 (Willard) and SB331 (Stine) — Claims transparency. Despite laws currently in place that entitle policyholders to their insurance policy and information on their claim, many policyholders report that their insurance company refuses to provide documents. This legislation would solve that by requiring insurance companies to proactively provide policyholders with claims materials they are already entitled to, so that the policyholder can understand their claim and advocate for themselves.
- HB692 (Larvadain) — Enforce the fraud laws we already have on the books. If laws are being violated by insurance companies, engineers, contractors, or anyone else after a storm, there needs to be investigation and enforcement. Unfortunately right now, there seems to be no law enforcement entity who considers it their responsibility to investigate potential fraud committed in the insurance claims process after a storm, especially if that fraud is committed by the insurance company or one of their representatives. This legislation would create a task force modeled after the Louisiana Automobile Theft and Insurance Fraud Prevention Authority that already exists in state government, focused on enforcing fraud laws against bad actors after named storms.
- HB317 (Willard) and SB150 (Luneau) — No more surprise deductibles. Many homeowners who file a claim after a hurricane say they were unaware that they had a ‘named storm deductible,’ which can be so high it renders their insurance policy useless. This legislation is modeled after current law on uninsured motorist policies in auto insurance. It would require policyholders to provide affirmative consent—like a signed form—agreeing to their named storm deductible before it can take effect as part of their policy. This will help consumers be better informed when purchasing their policy, and help insurance companies and agents avoid confusion and disputes over named storm deductibles when claims are filed.
- HB682 (Brown) and SB330 (Stine) — Adjuster registry. Many policyholders place their trust in the adjuster sent by the insurance company to begin adjusting their claim, only to find out later that that adjuster was inexperienced or unqualified. This bill would create a database of registered insurance adjusters that is easily accessible and digestible to policyholders, so that when the insurance company sends an adjuster to someone’s house, they can look them up and see if they are registered and qualified for the job.
- HB805 (Green) and SB355 (Gary Smith) — Stop mortgage companies from arbitrarily withholding checks. Right now, there are no rules governing how mortgage companies disburse checks they receive from insurance claims. As a result, homeowners can be left in the lurch while their bank earns interest on insurance money and the policyholder misses out on contractors. This bill creates reasonable rules for mortgage companies when handling insurance checks.
- SB209 (Stine) and SB210 (Stine) — Increase the fines the insurance commissioner can levy against insurance companies who break the rules.
- SB13 (Bouie) and SB345 (Gary Smith) — Limit insurance companies to three adjusters to stop the endless adjuster churn so many policyholders deal with.
- HB83 (Schlegel) and SB134 (Talbot) — Require insurance companies to honor the sections of their policies that cover costs for evacuation, even if the evacuation is only suggested by local government leaders, and not mandatory.
- SB231 (Henry) — Make uninhabitable mean uninhabitable. This legislation would stop insurance companies from claiming that dangerous living conditions with long term lack of basic utilities do not make a dwelling "uninhabitable." After Hurricane Ida, Louisianans died because their insurance company would not pay for them to find a safe place to stay.
- SB253 (Barrow) — Makes it illegal for insurance companies to discriminate against elderly and developmentally disabled policyholders.
- HB621 (Green) — Gives more time for policyholders to complete repairs.
- SB105 (Fesi) — Requires insurers to give 30 days notice of changes to policies that will happen at renewal.
- SB119, SB163 (Talbot) and SB232 (Stine) — Creates a Catastrophe Claims Consumer Guide and Catastrophe Claims Disclosure Form that must be given to policyholders.
- SB198 (Talbot) — Gives a point of contact and info on dispute to policyholder after they’ve dealt with three adjusters.
- SB214 (Luneau) — Requires out-of-state adjusters to return to Louisiana to testify in case of a legal dispute.
- SB352 (Fields) — Requires utility providers to issue a credit to customers who experience an outage of service for more than 24 hours.
- HB703 (Miller) — Requires disputes about contracts for repairs to residential property during a hurricane to take place in parish the property is located in.
- HB788 (Romero) — Provides for an out-of-state contractor database.
Automotive Claims
- HB351 (Jordan) - Bans the use of ridiculous non-driving rate setting factors like education level, employment status, trade, business, occupation, profession, or credit information. Insurance companies use these ridiculous factors to overcharge good drivers and undercharge wealthier, upper class reckless drivers. This hurts the entire insurance market by reducing incentives to drive safely and causing good drivers who work blue collar jobs or have low credit scores to go uninsured or underinsured because they’re being overcharged.
- HB116 (R. Carter) – Stops insurance companies from passing on the costs of their ubiquitous advertising to policyholders in their insurance premiums. Drivers shouldn’t have to pay for the cost of all those unavoidable ads featuring Emus, Geckos, Mayhem, and Jake.
- HB290 (R. Carter) - Provides for a five percent insurance rate reduction for motor vehicles with a dashboard camera.
OPPOSED LEGISLATION:
Property Claims
- HB539 (Firment) – Weakens current legal protections in place to ensure policyholders get the replacements and repairs they are entitled to.
Automotive Claims
- SB128 (Talbot), SB120 (Talbot) and HB705 (Seabaugh) – Like 2020’s failed tort reform legislation, these bills would further rig the courts against policyholders in order to pad corporate profit margins. And like 2020’s failed tort reform legislation, these bills would do nothing to lower insurance rates. They would give insurance companies more ways to delay and deny claims like they are doing to tens of thousands of hurricane victims across South Louisiana.
Top 3 Reasons Louisiana Has High Insurance Rates
Louisiana is the most unaffordable state for insurance in the nation, with nearly $1 out of every $10 earned going to insurance costs. Here are the top 3 reasons why.
Home insurance rates are increasing in Louisiana, despite Commissioner Tim Temple's tort reforms that gutted consumer protections.
Louisiana Senate Debates Lax Regulation and Excessive Insurance Rates The Senate Insurance Committee met on Friday, March 14th. There was a robust discussion between Senator Royce Duplessis and Insurance Commissioner Tim Temple about the commissioner's authority, following previous testimony that Louisiana's lax laws do not allow the commissioner to reject rate increases for being excessive. This conversation is important because Louisiana is among the most expensive states in the country for insurance, with nearly 10% of median household income going to insurers. The Law The statute in question is LA Rev Stat § 22:1452 (C)(6) , which states that "no rate in a competitive market shall be considered excessive." Furthermore, the statute defines "excessive" as "a rate that is likely to produce a long-term profit that is unreasonably high for the insurance provided." Commissioner Temple's Previous Testimony In a prior meeting of the Joint Insurance Committee , Commissioner Temple stated that "The Department's role is to look at it [rate filing] and make sure the actuary's work matches; that the numbers add up...We look at it to make sure the rate is adequate and not unduly discriminatory...Our role is not to look and determine whether we think it is right or high or low...If you will, it's to check their math." He repeated that sentiment, reading from a written statement to kick off the March 14th hearing, that "my role is to ensure that property & casualty rates are adequate, actuarily justified, and not unduly discriminatory." These comments are consistent with the authority granted to the commissioner by Louisiana law. Does Louisiana have a competitive market? Louisiana law plainly states that "no rate in a competitive market shall be considered excessive." So Senator Duplessis twice asked Commissioner Temple if Louisiana's market was competitive. Both times Temple responded that Louisiana has a competitive market, though he would like more competition. Commissioner Temple has repeatedly said that Louisiana's high insurance rates were due to a lack of competition and used this claim to promote industry-friendly legislation that strips policyholders of their rights. Has Commissioner Temple ever rejected a rate for being excessive? Senator Duplessis also asked Commissioner Temple and his staff multiple times if the Department of Insurance has rejected any rate increases for being excessive. Nichole Torblaa, the department's Chief Actuary, said, "We have deemed rates to be not actuarily justified." Later the department's deputy general counsel interrupted Commissioner Temple to clarify his comments after Temple claimed he had the authority to reject an excessive rate: "He's using the word excessive because you are, but what he's referring to is a high rate not comparable to the risk, which ends up being not actuarily justified." This was a theme throughout the hearing. Commissioner Temple repeatedly conflated the terms "excessive" and "actuarily justified." Profits “They don’t lie; they just don’t tell you unless you ask the right set of questions. The regulator won’t necessarily know what the insurance company is doing or what goes into their models. Heck, we don’t even know half the models’ names.” - Rich Piazza, former chief actuary for the Louisiana Department of Insurance Piazza's quote demonstrates the problem with a lax regulatory system that simply checks insurer's math. Big insurance companies employ armies of actuaries and lawyers who know how to build complex mathematical models that can justify any rate. Moreover, immediately after taking office, Commissioner Temple eliminated an internal rule that capped the amount of expected profit insurers could build into rate filings with the state. With no regulatory authority to reject excessive rates and no caps on expected profits, it is not surprising that expert testimony before the Senate Judiciary A committee revealed that some of the rate filings reviewed in Louisiana contained "really, really high" profit factors. As a result, Louisiana's personal auto insurance loss ratios (proxies for profit) were 9% better than the national average in 2023, and at least 5% better than each of our neighboring states: Arkansas, Mississippi, and Texas. It is also consistent with a detailed joint study from faculty at Harvard and Columbia, and a member of the Fed Reserve Board of Governors that found “higher [insurance] premiums are being charged in states where regulators apply less scrutiny to requests for rate increases.” Click here to watch the entire hearing from March 14, 2025. Click here to read expert's bombshell report on Louisiana's insurance crisis.
2025 Legislative Primer. The 2025 Louisiana Legislative Session begins Monday, April 14, 2025. Insurance is again at the forefront, but this time Commissioner Temple and his legislative allies are focused on auto insurance. Temple is touting a package of bills that promise to further stack the deck in favor of big insurance at the expense of Louisiana policyholders. Here is an overview of Louisiana's insurance crisis and the industry's continued efforts to profit off of policyholders' pain.
Florida's failed model won't work in Louisiana. Louisiana's insurance crisis is crushing working families and small businesses. Property and auto insurance premiums are soaring while the Bayou State's loss ratios (a proxy for insurer profits) are among the best in the nation. Nevertheless, Commissioner Tim Temple, his allies in the legislature, and the insurance industry continue to push anti-consumer legislation that makes it harder for policyholders to file a claim with no promise of lowering rates. Proponents of these bills that stack the deck further in favor of big insurance routinely cite the recent "reforms" enacted in Florida. So, let's set the record straight about Florida. Florida's reforms failed According to Insurance Business Magazine , insurers are seeking a 50% premium hike in Florida. Moreover, "Citizens Property Insurance Corp. is set to increase rates for most policyholders in Florida, despite recent statements from Gov. Ron DeSantis suggesting that the insurer would implement statewide premium decreases." Florida lawmakers stacked the deck in favor big insurance, then asked to be dealt a hand at policyholder's expense Immediately after passing the industry-friendly package, some Florida lawmakers began pitching "a proposal to invest in a new homeowners insurance company, according to a Miami Herald/Tampa Bay Times story. The pitch comes with an impressive projected return on investment of 165% over five years." Insurers lied to lawmakers and policyholders, pocketing billions while claiming losses Insurers exploited the lack of transparency and accountability. "As Florida insurance companies were going bankrupt, policies were getting dropped and homeowners were being left empty-handed, a new report says many of those companies were making billions." Lawmakers looking to roll back failed reforms Having realized their extreme reforms hurt policyholders, "Florida legislators have introduced bills that would amend state insurance laws," aimed "to enhance consumer protections while increasing regulatory oversight of insurance carriers operating in the state." The people of Florida are fed up The average home insurance policy is more than $8,000 higher in Florida than the national average. Unable to afford these unaffordable rates, Florida voters are looking to "take the power of lowering insurance premiums into their own hands." They will vote on "a newly proposed amendment to the State Constitution would also protect consumers from seeing their policies canceled." Louisiana cannot afford to follow Florida's failed model Louisianans are already paying more of their income on insurance than any other state. Working families and small businesses cannot afford to continue pursuing changes that benefit big insurance at their expense.
Big Insurance's Louisiana Boondoggle. Former Missouri State Insurance Commissioner Jay Angoff recently testified before the Louisiana Senate Judiciary A Committee. The former commissioner reviewed data provided by insurance companies to the National Association of Insurance Commissioners (NAIC). The hearing and most of the data presented focused on personal and commercial auto insurance. A key takeaway on personal auto from the NAIC data was that Louisiana's insurance market is competitive and profitable. This revelation was particularly interesting because it undercuts Commissioner Tim Temple's analysis of the Louisiana insurance market and his legislative agenda. Commissioner Temple has repeatedly stated: "If we get more companies in Louisiana, then that helps solve issue number one which is availability. Once you have more companies in Louisiana, that helps work on problem number two which is affordability.” Yet, the data presented by former Commissioner Angoff painted an entirely different picture.
Expert, Former Commissioner Testifies on Louisiana's Insurance Market. Former Missouri State Insurance Commissioner Jay Angoff recently testified before the Louisiana Senate Judiciary A Committee. The former commissioner reviewed Louisiana’s insurance regulations, other states’ laws, and information provided by insurance companies to the National Association of Insurance Commissioners (NAIC). Mr. Angoff provided a detailed, data-filled report on Louisiana's insurance market. He explained how lax regulations that make Louisiana an extreme outlier contribute to high insurance rates. Additionally, he discussed the high returns insurers are seeing on policies in Louisiana and the massive profits rolling in on investments on their $1 trillion surplus. Below are highlights from the hearing and a copy of Mr. Angoff's complete report and testimony.
New U.S. Senate Report Shines Light on Louisiana's Insurance Crisis. In 2024, Commissioner Tim Temple and lawmakers repealed a crucial safeguard for Louisiana policyholders, allowing insurers to cancel home insurance policies at will. This alarming change took effect on January 1, 2025, leaving policyholders vulnerable. Why is this important: The increased threat of severe weather has led to a rampant increase in non-renewals nationwide. The New York Times reports that "since 2018, more than 1.9 million home insurance contracts nationwide have been dropped. In more than 200 counties, the nonrenewal rate has tripled or more." This is all according to findings in a new report from the U.S. Senate Budget Committee. T h e report notes that "Florida and Louisiana — the top two states by non-renewal rate in 2023 — also experienced 280% and 267% increases, respectively, in non-renewal rate percent change from 2018 – 2023." Lafourche, Terrebonne, and Jefferson Parishes have among the highest non-renewal rates in the nation for 2023. Orleans, Terrebonne, and Tangipahoa Parishes have suffered among the largest increase in non-renewals.
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