![https://img.particlenews.com/image.php?url=1op4uT_0vSksJsV00](https://img.particlenews.com/image.php?type=thumbnail_580x000&url=1op4uT_0vSksJsV00)
(The Center Square) − Hurricane Francine is predicted to make landfall in Louisiana on Wednesday, leaving many people at risk of storm damage.
Also at risk is the state's insurance market, which has been dealing with its own storm of scarcity, risk and cost in recent years.
While Francine is a minimal Category 1 hurricane, winds of 90 miles per hour are enough to do extensive damage, especially to properties in low-income areas or otherwise vulnerable properties.
The cost of that damage may not be exclusive to such areas, especially in Louisiana's vulnerable property insurance market. The damage inflicted by Francine may have an impact on policyholders as a whole, increasing already high premiums.
According to LSU's 2023 Louisiana Survey , 17% of homeowners had their insurance policies canceled in 2022. Additionally, 55% of those who sought new coverage faced challenges, while 63% experienced higher premiums.
Insurance companies writing policy in Louisiana face costly liabilities because of the state's vulnerability to hurricanes. Many insurers have gone bankrupt or left the state.
As a result, the property insurance market has become uncompetitive, leaving many Louisianans with the state's insurer of last resort, Louisiana Citizens Property Insurance Corporation.
As previously reported by The Center Square, Citizens is the fourth-largest insurer in Louisiana, with $103 million in written premiums. In 2023, it raised its rates by 63%, driven by increasing reinsurance costs, according to information from the Louisiana Department of Insurance.
The cost of reinsurance, according to a report by investment banking group Jefferies, has increased 3% this year after a 37% hike in 2023.
"My office has been in constant contact with insurers doing business in Louisiana to make sure they are prepared and know our expectations for responding to events like Hurricane Francine," Insurance Commissioner Tim Temple said in a statement . "In light of those efforts, as well as our increased solvency reviews and the property insurance reform we passed this session, I believe we have a strong foundation for successfully responding to this hurricane and for maintaining our progress on making Louisiana a good place for companies to do business."
In April, Rep. Matthew Willard, D-New Orleans, proposed House Bill 524 to remove a 10% surcharge on policies from the state's insurer of last resort, arguing that homeowners are stuck with higher costs due to a lack of competition.
Meanwhile, House Bill 513, from Rep. Joseph Stagni, R-Kenner, would have required a financial review and public hearing for insurance rate filings with profit expectations above 10%.
Both bills failed to pass during the recent session.
Congress did manage to pass other bills, however. Those four bills repealed certain provisions related to bad faith claims handling, allow homeowners to continue receiving grants to strengthen homes against severe weather, relaxes a rule that forces insurers to continue covering homeowners after three years of coverage, and aim to speed up the availability of insurance products in the state.
"A common theme across Louisiana's new insurance laws is an effort to bring the state more in line with neighboring states' practices in the insurance space and make Louisiana less of an outlier," according to Adams & Reese , a Baton Rouge law firm. "The stated goal of the insurance reform package is to stabilize Louisiana's insurance markets by making changes to the law to entice additional carriers to write homeowners policies in the state."