The Louisiana Legislature’s insurance committees have scheduled an Oct. 23 meeting to discuss what can be done to help residents facing skyrocketing flood insurance increases.
Changes in the National Flood Insurance Program to put it on sounder financial footing could mean rate increases of up to 4,000 percent on some Louisiana homes and businesses. An estimated 18,000 Louisiana policies will see immediate impact.
The Advocate reported Louisiana has nearly 500,000 flood insurance policies.
“With so many changes and rate increases impacting not only our coastal residents, but our entire state, and with no definite fix at this time in D.C., it is time that we discuss what can be done on a state and local level,” Senate Insurance Committee Chairman Dan “Blade” Morrish said.
“I don’t know that we have any fix but people may come up with ideas that are worthy of discussion,” said Morrish, R-Jennings.
Morrish said the hearing also will provide an opportunity for education about the flood insurance situation.
“There’s a lot of misinformation, uncertainty about how it’s going to be implemented … as well as information from the federal delegation about what they think they can do and what they cannot do,” he said.
Congressional fixes – pushed by the state’s delegation – that would delay insurance rate increases for a year are under consideration but the federal government shutdown has impeded any progress. Rate increases for some properties began being phased in on Oct. 1.
The Senate and House Insurance Committees will meet at 9:30 a.m.in House Committee Room 5 at the State Capitol.
Among those scheduled to attend are Donald Cravins, chief of staff of Sen. Mary Landrieu, D-La.; and Michael Hecht, representing economic development group Greater New Orleans Inc. Commissioner of Insurance Jim Donelon, 20 coastal parish presidents, representatives of federal agencies, real estate interests, bankers and insurance agents have been invited.
Congress has approved plans to eliminate federal subsidies, raise premiums to market rates over time and remove the “grandfather” provision that shielded property owners from rate spikes if their properties were built to proper specifications and later reclassified because of new Federal Emergency Management Agency flood maps.
Louisiana’s delegation wants to change some rates affecting “grandfathered” properties and a trigger that allows rates to jump suddenly when homes are sold in some areas.