The Louisiana legislature adjourned its 2007 regular session last week on a disappointing note for insurers, a trade group said Thursday.

John Marlow, assistant vice president, American Insurance Association, Southwest Region, said that while several positive bills were passed by the legislature and sent to Governor Kathleen Blanco for signature, other bills passed could make it more difficult for insurers to write homeowners policies in the state.

"At the end of the day, the positive impact of abolishing the Louisiana Insurance Rating Commission was negated in the final days of the session," he said.

A bill (SB 204) not allowing insurers the ability to offer flexible deductibles to meet the needs of both inland and coastal residents of Louisiana was gutted in the final hours of the session.

"With the removal of the 10 percent surcharge on Citizens rates from the 11 coastal parishes impacted by Hurricanes Katrina and Rita (HB 962), insurers will be very cautious about writing property insurance in the state for many years to come and therefore may not take advantage of the Insure Louisiana Incentive Program (HB 678), and competition will be slow to return to these areas," he said.

Since insurance was a primary issue for the legislative session, a large number of bills were filed and considered.

The following bills were passed and are awaiting Gov. Blanco's signature:

o HB 558--requires insurers to submit rates and rating plans to the office of property and casualty for mitigation credits.

o HB 678--establishes the Insure Louisiana Incentive Program and provides that the commissioner of insurance may grant matching capital funds to qualified property insurers from a $100 million fund. Also establishes criteria for insurers applying for grants.

o HB 960--abolishes the Insurance Rating Commission and establishes the Office of Consumer Advocacy within the Department of Insurance. This bill also provides for a file-and-use rating system, giving the commissioner of insurance 45 days to reject rate changes.

o SB 204--originally was introduced to provide for insurer flexibility in deductibles on homeowners policies. The bill ended up in conference committee where all language was stripped from the bill except the phrase "two or more claims within a period of three years." This does not include any loss incurred or arising from an "Act of God" incident due directly to forces of nature and exclusively without human intervention.

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La. Lawmakers Disappoint Industry

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