By Meagan Rousse, managing Editor
Louisiana residents are still facing insurance issues one year after Hurricane Ida hit.
With some insurance companies going bankrupt, policyholders are being left to find relief from state agencies. Homeowner Holly Crochet has been living in a rental for the past year due to struggles with her insurance.
“You feel like you go and you have your insurance and your home is insured,” Crochet says. “You pay all these premiums and those premiums are expensive. I’ve paid them for 30 years and the first time I needed my insurance I couldn’t get it.”
— Holly Crochet, Terrebonne Parish resident
Crochet’s insurance problems began with her first adjuster. It took two weeks for someone to come inspect her home, and she says he was very inexperienced. Five weeks after the storm, she received her first of only two payments from her insurance.
“That only covered honestly our roof and right behind we have a pool house so I changed the pool house roof,” she says. “Basically just, it was not enough.”
Shortly after, she found out her insurance company was pulling out of the state by watching tv.
Crochet is not the only one facing insurance problems.
“Homeowners all across South Louisiana have experienced either having their homeowner’s insurance policy canceled as insurance companies choose to no longer do business in South Louisiana, or companies have also gone bankrupt and are no longer operating in Louisiana in some instances,” says Cashauna Hill, executive director of the Louisiana Fair Housing Action Center.
The Louisiana Fair Housing Action Center is a nonprofit organization that helps residents with housing issues. Most recently they helped to pass a bill that protects residents against illegal evictions, which many tenants faced after Ida.
“This bill that was recently passed and signed into law and did go into effect provides some concrete penalties for property owners who tried to evict families outside of the normal court process,” Hill says. “Every little step that we can take in providing rights for tenants and landlords under state laws is a huge win, but we do know that there’s still so much more left to be done.”
In addition to efforts from the Louisiana Fair Housing Action Center, residents are looking to companies like the Louisiana Insurance Guarantee Association (LIGA), an agency that helps policyholders when their insurance becomes insolvent.
“If they [insurance companies] fail or go into bankruptcy, then LIGA steps up and takes over those claims up to $500,000 per claim,” says Jim Donelon, Louisiana Department of Insurance commissioner. “That’s the second highest coverage limit of any of the 50 states.”
As of August 2022, there were eight insurance companies that collapsed following the aftermath of Ida, many that were based in Florida, Donelson says. Including Crochet’s previous insurer, Maison.
With little options available for residents facing insurance insolvency, Donelon is hopeful there will be more funding for future disasters.
“What I am expecting to happen in the near future is for the legislature to pass a funding bill to fund the creation of the Louisiana Insurance Extended Program which was passed in legislation during the recent session,” he says.
The bill will help insurance companies match the money given from a grant to help double the policies premium rate.
Companies like Louisiana Citizens are available to help those who were dropped from their insurance, but it is often a last resort. The goal of Citizens is to offer help to customers who cannot get insurance on their own, however the company’s rates are not the cheapest.
“My premium went from right around $4,000 prior to Ida per year and when I had to find new insurance with Louisiana Citizens, my policy dropped to over $8,000 a year. It’s my issue of last resort, I’m still with them. I’m insured with them and I basically can’t even live in the structure.” says Crochet.
Since Ida, the Citizens program now has around 120,000 customers. This is the biggest increase in policyholders since Hurricanes Katrina and Rita in 2005.
Following hurricane Laura, Citizens had around 35,000 policies in their book. This rate increased to around 60,000 policies shortly after Ida hit. These policy increases are mostly credited to the eight insurance companies that have gone insolvent.
There are not many laws and regulations regarding protection for homeowners. However, efforts like the eviction bills and the new Louisiana Insurance Extended Program.
“So far we’re in a position where our state is not offering any sort of comprehensive, affordable options or assistance or solutions for families who are struggling to find homeowners insurance or afford homeowners insurance policies,” Hill says. “Large scale comprehensive measures designed to protect families in South Louisiana should certainly be a legislative priority.”