Multiple rate hike requests from insurers and consumer concerns prompted Louisiana Governor Mike Foster to hire an advisor to assist him and the Louisiana Insurance Rating Commission (LIRC) in considering the rate requests. The New Orleans Times-Picayune reported that Foster expects even more efforts by insurance companies to raise rates. Foster’s office will pay Chris Faser, formerly with the state insurance department, a salary of $49,900 to help determine which rate hikes are acceptable. Faser’s contract lasts through June 30, 2003. The LIRC recently postponed a decision on a 16 to 21 percent auto insurance rate hike requested by State Farm. That company placed a moratorium on new auto policies in Louisiana, contending it has lost $300 million in that state over the past two years. Foster expects carriers to raise rates to make up for investment losses and costlier reinsurance.
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