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Louisiana Governor Kathleen Babineaux Blanco kicked off a three-day insurance outreach mission Jan. 29 in San Francisco, part of her continuing efforts to bring affordable insurance home to Louisiana, the governor’s office announced.
“We in Louisiana have made great strides to protect ourselves from future natural disasters, and that’s the story I’m here to share,” Governor Blanco said in the announcement. “Through levee repairs, levee board reform, our focus on coastal restoration and hurricane protection, the adoption of our new statewide building codes, and homeowner mitigation efforts, we are doing a lot when it comes to reducing our risk. But if our home and business owners are to realize the benefits of those efforts in the form of lower insurance rates, we must aggressively tell our story.”
Gov. Blanco met with AIR Worldwide, the first of two risk modeling companies on her outreach mission. The company provides the catastrophe modeling technology used by insurers, reinsurers and financial institutions to determine estimated risks for all major natural hazards, including hurricanes, floods, tornadoes, earthquakes, and hailstorms. This worldwide company has developed risk models for North America, the Caribbean, South America, Europe, and the Asia-Pacific region.
On Jan. 30, Gov. Blanco will meet with Risk Management Solutions Inc., which recently completed a risk analysis of New Orleans. On Jan. 31, Gov. Blanco and Commissioner of Insurance Jim Donelon will address the Property and Casualty Insurers of America Board of Governors.
“As we continue seeking solutions to the insurance crisis facing our state, I believe the industry can meet us halfway,” Gov. Blanco said. “There has been an overreaction to the perceived risk of writing policies in Louisiana, and dropped coverage and spiking rates are the result. Wednesday I will reach out to industry executives and invite them all to do business in Louisiana. Increasing the number of insurance companies in our state will result in more affordable insurance. With that critical goal in mind, I will continue to aggressively tell our story.”
According to an Associated Press report, Blanco might find herself with a more receptive audience and additional negotiating leverage with insurers thanks to the Florida Legislature’s recent decision to roll back rate increases for the state’s insurer of last resort and to increase the obligations of the state-run catastrophe reinsurance pool without adequate financing.
Insurers now say Florida’s credit rating is in jeopardy, and that the experiment will hurt consumers in the long run.
“What we really want to talk about is how we can avoid the whole situation that’s happened in Florida happening in Louisiana,” said Joseph Annotti, vice president of communications for the Illinois-based Property and Casualty Insurers group.
Annotti said his group thinks the industry can work with state government to find ways to reduce the insurance burden on taxpayers by establishing well-designed catastrophe funds, involving the federal government and taking other measures.
“What happened in Florida was a very big wake-up call to us,” he said.
Insurance Commissioner Jim Donelon told the AP that his goal to talk with a dozen insurance companies that don’t operate in Louisiana by March got a big lift because of what occurred in Florida.
Sources: Louisiana Governor’s Office; The Associated Press