La. in crisis mode over fallout from insurance companies making mass exits
BATON ROUGE, La. (WAFB) - Over the last few years, more than 20 companies have either withdrawn coverage from the state of Louisiana or have gone under.
“We’re definitely in a crisis,” said Rajesh Narayanan, professor at LSU College of Business.
Louisiana has seen an unprecedented number of storms. In 2020, Hurricane Laura caused catastrophic damage to our neighbors in the West, leaving more 40,000 homes in ruin.
Laura was followed by two more hurricanes, Delta and Zeta. Then in 2021, Hurricane Ida crashed into the state as a Category 4 storm.
“A lot of companies couldn’t satisfy claims,” continued Narayanan.
The amount totaled about $23 billion worth of claims.
“Currently, our situation is either premiums are too expensive and people can’t afford or companies are just leaving,” added Narayanan.
The average premium for home insurance in Louisiana is more than $2,000 a year, which is 46% higher than the national average.
“Either people will downsize or not move here. That is what we will see and change in migration,” explained Narayanan.
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