Louisiana insurance regulator warns new rate regulation law ‘destabilises’ market

By Michael Loney

June 23 - (The Insurer) - Louisiana Insurance Commissioner Tim Temple has warned that a recently enacted rate regulation law destabilises the market, while praising the state legislature for passing several bills that strengthen the property and auto markets.

In a letter recapping the state’s legislative session, Temple said that addressing the high cost of insurance “was once again a major emphasis”.

As previously reported, HB 148 was signed into law in May and is now Act 11.

Temple said that it gives the insurance commissioner unilateral authority to disapprove rate requests and publish proprietary and/or confidential information for purely political, personal and other subjective reasons.

The bill also allows the commissioner to subjectively determine that premiums an insurer charged years or decades ago were too high and to force that insurer to issue refunds for those premiums.

“Instead of helping address our insurance crisis, this new law makes Louisiana’s insurance industry more heavily regulated than California’s,” Temple said.

“This is not the right path for Louisiana. We compete against other states for insurance company capacity and absolutely must maintain our unbiased, predictable regulatory environment that fosters competition, protects consumers and ensures the financial stability of insurers.”

Temple said the state legislative passed bills in the session that strengthen Louisiana’s property and auto insurance markets but the decision to pass HB 148 “destabilises our market and threatens to neutralise – if not outright reverse – much of the progress we made this year”.

Three of the 20 insurance and legal reform bills Temple supported at the beginning of session were signed into law while five others have been sent to the governor and are awaiting his decision.

Eight of the 19 regulatory and property insurance bills he supported at the beginning of session were signed into law.

“We have made major progress in the property market, including the successful creation of a permanent funding source for the (Louisiana Fortify Homes Program). Unfortunately, the remaining six bills I supported failed in various stages of the legislative process,” Temple said.