Prepare to Fight for Storm Compensation Claims, Says Louisiana Insurance Commissioner | Economic news

Louisiana Insurance Commissioner Jim Donelon said on Wednesday that policyholders who were affected by Hurricane Ida and Tropical Storm Nicholas – and who may have to face other storms before the end of the hurricane season of this year – should file claims early and be prepared to fight for them.

There are already signs that some insurers are pushing back Ida’s claims. State Farm, Louisiana’s largest home insurer with a market share of around 26%, has refused to waive its policy clause which limits evacuation expense claims to those subject to an order of ‘evacuation.

Donelon said that Allstate, followed by others with significant market shares in Louisiana, including USAA, Progressive and Liberty Mutual, have all indicated they will waive the clause. So far, State Farm is the only major insurer to explicitly decline.

“Frankly, I expected it and thought they all would,” Donelon said. “I was shocked when [State Farm officials] told me that they wouldn’t and that they would stick to the language of the fonts. I pushed hard and they didn’t back down. “

State Farm did not immediately respond to requests for comment for this story.

Insurance costs for Hurricane Ida will not be counted for a few months. But disaster modeling companies like AIR Worldwide and Karen Clark & ​​Co. estimate them between 18 and 30 billion dollars. Louisiana will still bear 90% of those costs, Donelon said.

A $ 30 billion storm would be the eighth most expensive in U.S. history.

Already, the insurance department has dealt with more than 200 insured complaints regarding Ida’s claims. This is a fairly typical rate; for Hurricanes Laura, Delta and Zeta during the 2020 storms, there were 1,700 complaints out of a total of 315,000 insurance claims. As a result of complaints filed with the insurance department, policyholders earned about $ 50 million, or an average of $ 29,212 per complaint, Donelon said.

Donelon to answer insurance questions from Times-Picayune editor Peter Kovacs on Thursday | The Advocate, from 10 a.m. The interview will be broadcast live on NOLA.com and theadvocate.com

The retreat of insurance companies is part of a familiar dance after hurricanes and other major natural disasters, said Suzette Bagneris, a New Orleans lawyer specializing in insurance claims.

“We are seeing the same type of behavior happening this time around in terms of insurance companies and the way things are adjusted,” she said. Insurers sometimes send multiple adjusters to a property, with the wind specialist attributing the water damage and vice versa, as a tactic to minimize damage assessment.

Bagneris, who will take part in an insurance question-and-answer session at noon Thursday hosted by the New Orleans Regional Black Chamber of Commerce, advises policyholders to be proactive. She suggests using a local independent appraisal company, which typically charges around $ 75 an hour for a two-hour visit, and getting a contractor’s estimate for the repairs. Keep receipts or valuation estimates for items that need to be replaced.

“You don’t have to accept the damages assessed by the insurance company,” Bagneris said. “I have seen private damage appraisals increase a claim up to $ 50,000.”

Donelon said most of the complaints the insurance department received concerned lack of communication from insurers and slow payments.

The insurance department has started tracking complaints by company and weighing them against their market share to see if they’re attracting disproportionate numbers. State Farm had the most complaints last year, at 163, but that was roughly in line with its market share. Allstate and USAA were among the largest insurers that received far fewer complaints than expected given their market share.

In contrast, Allied Trust Insurance, which holds just under 1% of the market, recorded more than six times the number of expected complaints given its share.

Donelon said policyholders in Louisiana should remember recent insurance laws that were enacted to combat abuse by insurance companies. A 2009 law means that an owner’s deductible covers an entire hurricane season – not just a storm.

“If you have an evacuation charge or damage of, say, $ 4,000 and your deductible is $ 5,000, file it anyway,” Donelon said. “That means if you are unlucky enough to be hit by another storm in the same season, then your deductible will only be $ 1,000.”

Another law enacted after Hurricane Katrina in 2005 means that any claims for “acts of God” – hurricanes, tornadoes, floods and the like – cannot be used to increase your premiums or cancel your insurance. “This means that if you have a doubt you still have to file it,” Donelon said. “You could benefit from it, and it can’t hurt.”

One thing policyholders should avoid, however, is artificially inflating claims to overcome insurers who might try to reduce damage assessments, Bagneris said.

“You have to be a wise insured, but resist this temptation,” she said. “You don’t want to end up in an orange jumpsuit.”