INSURANCE

Like it or not, the State is being forced into the insurance business. The Louisiana Citizen’s Insurance Company will soon become the largest insurance provider in damaged hurricane prone areas of Southeast Louisiana. The ability to obtain quality insurance on the open market is vital to individuals and businesses trying to rebuild. However, we cannot allow fear of another hurricane event to unduly manipulate the market price. Even after the storm, insurance filings with multiple state regulators posted a total of forty-four ($44,000,000,000) billion dollars of profit in 2005. If companies are now allowed to sell a product that refuses the option of coverage for risks like wind damage, policyholders will have no protection against catastrophic losses and profits will soar unreasonably. This should not happen in a regulated industry.

As a State Representative, I will make sure that “insurance reform” does not turn into a loss of policyholder contractual rights. The insurance industry has been safely protected by regulation for years in order to assure profit. Now, the insurance industry must protect the policyholders of Louisiana. I don’t want anyone gouged, company or policyholder. A fair rate for a realistic evaluation of risk is appropriate. But, don’t expect to do business in Louisiana if your company is not stable and wants to pull out after years and years of profit in one sector. It would be like the Saints leaving town after all those years of support- it just isn’t right, and it is not good business.

This issue is complex, but it can be solved. Incentives for new companies to come to Louisiana must be explored. Reinsurance requirements for existing companies should be examined so the risk of loss to existing companies will be eliminated or reduced. Federal programs need to be considered and integrated into the Louisiana insurance solution. Policyholders must retain the right to acquire wind protection, and policyholders must know that their claims will be handled fairly and rapidly without the pressure.