Louisiana Audit Shows Hurricanes Led to Increase in Insurance Complaints

May 24, 2022

Residential property. complaints against Louisiana insurance companies skyrocketed in the aftermath of 2020 and 2021 hurricanes, according to a report released this month by the Louisiana Legislative Auditor.

The Louisiana Department of Insurance (LDI) received 21,143 complaints in the calendar years 2017 through 2021, with 7,941 (37.6%) of complaints relating to insurance for residential properties.

Residential property complaints ranged between 428 and 452 between 2017-19, then increased to 1,356 in 2020 and to 5,264 in 2021.

The rise in residential property complaints correlated with increased hurricane frequency and intensity in 2020-21 compared to the prior three years. Louisiana experienced Hurricanes Laura (Category 4), Delta (Category 2) and Zeta (Category 3) in 2020 and Hurricane Ida (Category 4) in 2021. Between 2017-19, Louisiana didn’t experience a hurricane of a strength greater than Category 1.

Ida resulted in 339,193 claims and 4,025 complaints. 1.2% of Ida claims resulted in a complaint. Comparatively, Laura led to 133,315 claims and 1,392 complaints. Ida affected double the amount of population as Laura.

95.7% of the 5,833 residential property complaints from 2020 and 2021 hurricanes were associated with policyholders’ dissatisfaction with how their claims were handled. Claim delay accounted for 53.4% of complaints, followed by unsatisfactory settlement / offer (28.7%), claim denial (17.7%), adjuster handling (17.3%) and other (4.9%) such as complaints related to assignment of benefits, insurers not complying with appeal procedures, etc.

96.8% of residential property complaints related to 2020 and 2021 hurricanes were filed against insurance companies. Complaint outcomes were favorable to the complainant 63.9% of the time.

Topics Catastrophe Natural Disasters Trends Louisiana Hurricane

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