La. House Approves Insurance Tax Credit for Homeowners

December 15, 2006

Louisiana homeowners deserve a rebate for the property insurance fees they pay to bail out the state-run insurance company, members of the state’s House of Representatives decided Dec. 13.

The measure, by Rep. Taylor Townsend, means homeowners will get a tax credit for the 15 percent assessment they paid this year to pay off the $1 billion debt incurred after the 2005 hurricanes by the Citizens Property Insurance Corp. Those who don’t have to pay income taxes can apply for a rebate check. Citizens is the state-run “insurer of last resort” that writes homeowners policies for homeowners who can’t find it on the open market.

The assessment was imposed on all insurers that write policies in Louisiana. Nearly all the firms passed the assessment on to their customers, according to the state insurance department.

The House approved an amendment by Townsend, D-Natchitoches, that would ensure that homeowners will also get rebates for Citizens assessments imposed in future years.

The House voted 99-0 to send the amended bill to the Senate – a politically popular measure that Gov. Kathleen Blanco is supporting as she struggles through a 10-day special session in which many of her initiatives have stalled.

If enacted, the measure is projected to cost the state over $1.8 billion in tax revenue through 2027, when Citizens’ bonds are scheduled to be paid off, according to the state Legislative Fiscal Office.

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