Could Your Homeowners Insurance Go Up by 63 Percent?

I don't care whether you live on the coast of Louisiana or not, you have likely seen an increase in the cost of your homeowner's insurance policy in the last few years. When it was time for my policy renewal, my policy increased by $600 a year. But, based on what I have heard from friends, that's not really that bad. I have a feeling it's only going to get tougher for all of us going forward.

Many people have been dropped by insurance companies and have been forced to rely on the state's insurer of last resort, Louisiana Citizens, which is backed by the state of Louisiana.  Now the entity has asked for a 63 percent increase in homeowner policies according to Insurance Commissioner Jim Donelon who spoke at a town hall meeting in Jefferson Parish Monday according to WVUE.

Another piece of information that may astonish you; Donelon says there were 37,000 policyholders of the last resort insurance company in 2021, but since hurricanes have massively impacted homes and businesses throughout the state in the last couple of years, other providers have dropped customers. They say it's not financially feasible to ensure these properties in Louisiana. Now Louisiana Citizens has 114,000 customers.

Donelon says that the rate hike has not yet been approved, and it will take him several weeks to investigate the proposed rate hike. We could have an answer in the next 3 to 4 weeks.

In the meantime, Donelon says he wants to reimplement a program that was used after Hurricane Katrina when many insurance companies opted to no longer offer coverage. We have the same situation with several companies now. They will not write insurance properties south of I-10 and I-12. He says the program if approved by the Legislature, would incentivize private companies to once again write policies in Louisiana. He says the goal is to get the cost of premiums to go down by incentivizing competition.