Insurer of last resort seeks a bigger line of credit as it inherits more policies; lawmaker wants more insurance reform & More Latest News Here – Up Jobs

NEW ORLEANS (WVUE) – As the property insurance crisis continues Louisiana’s insurer of last resort, Louisiana Citizens Property Insurance Corporation will seek permission from the state bond commission on Thursday to raise its line of credit after inheriting more policies due to insurance company failures and departures.

State Rep. Jerome “Zee” Zeringue, who is a member of the bond commission, says the legislature will take action to better protect policyholders from insurers.

“Some of them haven’t either made claims, they’ve had insurance for decades and the first claim they’re either getting dropped or they’re not getting paid or the hesitancy and the delay in getting the reimbursements that they need to be able to fix their homes. It’s a problem and I think on several levels we need to address this, and we will,” said Zeringue.

Citizens’ CEO Richard Newberry would not go on camera for this story, but he did answer questions during a telephone conversation. Newberry said the line of credit has been in place since 2010 and the bond commission approves it on a biennial basis, meaning every two years.

Newberry said Citizens is asking to increase the line of credit back to the 2013 level. He said it was $125 million that year when Citizens had 108,000 policies. Further, he said Citizens decreased the line of credit to $50 million in 2020 because it only had 35,000 policies at the time.

However, Newberry said as of this week policies grew to 103,000.

Zeringue believes some insurers were under-capitalized.

“It speaks to the situation we find ourselves in now, but we are in this situation unfortunately because of the fact that you know, the insurers themselves either weren’t financed properly or had sufficient reinsurance to cover these things,” he said.

Newberry said as the voluntary or private insurance market comes back, Citizens “depopulates” policies to the private market. He added that the depopulation of policies is up to insurance agents and the insured.

Citizens’ level of policies reached close to 200,000 following catastrophic Hurricane Katrina which hit in August of 2005 and was followed by another hurricane.

“We’ve been as large as 175,000 policies after Katrina-Rita. That has been our high-water mark,” said Newberry.

And he stressed that the line of credit has never been used before, but it is a necessary safety net to bridge the gap between any future Citizens’ deficits to the regular assessment placed on property insurers operating in the state.

Insurance Commissioner Jim Donelon says Citizens’ authority is based on state law.

“They have under the law like their duty to provide coverage for anyone who can’t get coverage in the private sector, their board also has the duty to assess every property insurance policyholder in the state to meet the shortfall of Citizens, if necessary,” said Donelon.

Newberry said Citizens has increased staff and will continue to do that as needed.

Zeringue is certain the legislature will act to protect policyholders.

“I know Commissioner Donelon and his staff are working on some things, but there are some legislative issues or ways that we can address this to ensure that we have more responsible parties participating in the insurance market and that they’re not leaving their clients and the citizens of Louisiana left holding the bag,” said Zeringue.

On Tuesday (Aug. 16) Donelon announced that Weston, a Florida insurer with about 10,300 policies in Louisiana was placed into liquidation which will cause the cancellation of its Louisiana policies on September 7. And a press release said United Property & Casualty Insurance Company had its financial stability rating downgraded and some of the 37,000 policyholders in Louisiana with mortgage-paid policyholders may be forced to find a new insurer.

And there is growing concern over increasing insurance premiums, the impact on the real estate market, and the overall economy.

“There’s no doubt the insurance market is going to completely change the complexion and the ability of people to live in coastal Louisiana,” said Zeringue.

Property insurance premiums, as well as flood insurance costs, have increased for many residents.

“The flood insurance in many cases is going to be more than their mortgage payments on their homes, so they won’t be able to afford to build or rebuild or even purchase a home,” said Zeringue.

See a spelling or grammar error in our story? Click Here to report it. Please include the headline.

Copyright 2022 WVUE. All rights reserved.

I have tried to give all kinds of news to all of you latest news today 2022 through this website and you are going to like all this news very much because all the news we always give in this news is always there. It is on trending topic and whatever the latest news was

it was always our effort to reach you that you keep getting the Electricity News, Degree News, Donate News, Bitcoin News, Trading News, Real Estate News, Gaming News, Trending News, Digital Marketing, Telecom News, Beauty News, Banking News, Travel News, Health News, Cryptocurrency News, Claim News latest news and you always keep getting the information of news through us for free and also tell you people. Give that whatever information related to other types of news will be