Louisiana Audit Shows Hurricanes Led to Increase in Insurance Complaints

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