Louisiana's insurance crisis: When can we expect relief ?

 


NEW ORLEANS (WVUE) - As Louisiana homeowners face escalating property insurance premiums, many are reaching a financial breaking point, with hopes for relief dimming as insurance companies continue to limit coverage in high-risk areas.

In a special report, Fox 8 examined how this crisis affects residents, the potential for legislative reforms, and insights from Florida, a state with a similar history of insurance struggles.

Homeowners like Billie Landry, a Jefferson Parish resident, are watching their budgets buckle under the weight of rising premiums.

“It keeps going up it seems like every year,” she said.

The Landrys have lived in their two-story home for 40 years, but paying for upkeep is impossible given their insurance costs.

“Although we have our home paid for, with the insurance and the way things are going, we can’t afford maintenance work on it which it needs desperately,” said Landry.

Complaints about the cost of insurance are widespread, especially in south Louisiana. Jefferson Parish resident Jack Donnalley echoed the frustration. “We’re paying over $12,000 a year,” said Donnalley. “It’s gone up 75% since we moved in here two years ago. We’re not actually very happy about it.”

Homes are covered in blue tarp after suffering damage from Hurricane Ida.
Homes are covered in blue tarp after suffering damage from Hurricane Ida.(WVUE)

Rising Costs and Limited Coverage

Annual premiums vary per property but veteran insurance agent Dan Burghardt shared insight on insurance costs in some parts of the New Orleans area.

“In Orleans, anywhere between $8,000 and $10,000 for a $250,000, $300,000 home,” said Burghardt. “The average rate in the Metairie area is about $6,000 to $7,000 for a $250,000, $300,000 home.”

The National Bureau of Economic Research says on average insurance premiums have risen by more than 30% nationwide since 2020 and premiums have risen the most for homeowners in areas at greatest risk for natural disasters such as hurricanes and wildfires.

While Hurricane Francine’s September 2024 landfall in Louisiana resulted in some flooding, wind damage from Hurricanes Laura and Ida in 2020 and 2021 was catastrophic. Following the two storms, 12 insurers operating in Louisiana became insolvent.

Andreanecia Morris, executive director of HousingNOLA, an organization that advocates for affordable housing, says some homeowners have not been able to recover from Laura and Ida due to non-payment by insurers.

“We have not been able to get frankly insurance payments to actually help people repair their homes, make them stronger,” said Morris.

And unrepaired homes are hard to insure.

“Now all of a sudden you’re not worthy of insurance from that same company or another company without a dramatic increase in costs. That’s why we have so many on Citizens, the insurance of last resort,” Morris stated.

Tim Temple took over as La. insurance commissioner in January amid the ongoing insurance crisis. He said Louisiana Citizens, the state’s insurer of last resort, has about 130,000 policies.

“It’s certainly a financial stress on individuals, on families, on businesses and I’m aware of that and I am working tirelessly every day to help make the changes that can be made,” said Temple during a one-on-one interview with FOX 8.


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