LDI says Liberty Mutual owes $4 million to LA policyholders after overcharging assessment
By Mia MacGregor
March 7 - (The Insurer) - Liberty Mutual owes approximately $4 million to about 138,000 Louisiana policyholders after overcharging the Louisiana Citizens Property Insurance Corporation Emergency Assessment for the past four years, according to the state's insurance commissioner Tim Temple.
The Louisiana Department of Insurance (LDI) stated that in February, it received a consumer complaint regarding the Louisiana Citizens assessment listed on a Liberty Mutual renewal notice.
The LDI Office of Consumer Services found that Liberty Mutual had not updated the assessment percentage since 2021 due to an error.
“I have spoken with Liberty Mutual about the issue, and they told me they corrected the error and will send refunds to all active and inactive policyholders that were impacted,” Temple said. “The LDI will monitor the company repayments to ensure policyholders receive all the funds they are due.”
The LDI noted that it is continuing to gather information to determine whether additional regulatory action against the company is necessary.
Additionally, the department stated that while this appears to be an isolated incident, the LDI is working to verify that this issue has not occurred with any other insurers.
The emergency assessment was initially implemented to pay off bonds related to claims from hurricanes Katrina and Rita in 2005.
Over the years, the assessed amount was gradually reduced, and in January, the Louisiana Citizens Board of Directors voted to end the assessment in April 2024.
According to the LDI, Liberty Mutual asserts that all payments remitted to Louisiana Citizens were correctly calculated and reported.
The department also noted that the company has since adjusted the assessment charge to 0% as of April 1 for all affected policyholders.
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