Louisiana’s state-backed property insurance firm is at odds with the Office of the Legislative Auditor over the rate setting process.
The auditor’s office released a report saying the Louisiana Citizen’s Property Insurance Corp. improperly adopted changes to its rate-setting formulas without prior approval from its governing board. The move involved a rate increase of 7 percent.
But Citizens CEO John Wortman responded that the firm won approval from its board, after it had won approval from the Department of Insurance.
Wortman, in a written response to the audit report, said the disagreement was about timing – which approval took place first.
Wortman argued that Citizens approval from both the board and the insurance department, but not necessarily in that order. Both approvals came month before the new rates took effect.
“We continue to believe the statute does not specify an order for approval,” Wortman said in the letter.
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