Life Insurance

Louisiana Insurance Commissioner Jim Donelon and Gov. Kathleen Babineaux Blanco unveiled a joint package of legislative proposals in March to attract new property insurers to the state.

Big name insurance companies such as Allstate and State Farm have declined to write new policies in coastal areas since the 2005 hurricane season. Donelon is asking lawmakers to appropriate $100 million to create a “surplus match” fund program to lure new underwriters to Louisiana.

“I don’t know how many businesses can look at their competitors getting handouts from (the) government and think they can compete with that,” Bowler said.

Donelon initially pushed state Sen. Ken Hollis, R-Metairie, to back his incentive plan, but Hollis said he has not seen a written version of program.

Donelon’s goal through the surplus matches is to reduce the number of customers relying on Louisiana Citizens Property Insurance Corp., the state-created property insurer of last resort. Created by the Legislature in 2002, Citizens, with 148,00 working policies, had 125,000 before Katrina and expects to reach 200,000 by year’s end.

Cain wants the state to put Citizens policies up for bid on the private insurance market to see if there are any companies willing to take the risk. He anticipates resistance from the insurance companies underwriting Citizens policies.

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