Despite its focus on fiscal matters, Louisiana’s 2007 legislative session, which begins April 30, is certain to have plenty of impact on the insurance industry, according to one industry lobbyist. And it’s not necessarily going to be the kind of impact the industry would prefer.
“We have a lot of challenges ahead in Louisiana,” said David Tatman of Baton Rouge-based The Tatman Group, a lobbyist for various insurance groups in the state. “If you go around to legislators and ask them what their number one issue is, they’re going to tell you insurance.”
This year’s session is what’s known as a “fiscal-plus-five” session, Tatman explained, and it will be short, lasting only 60 days. Lawmakers are allowed to file any number of bills dealing with fiscal issues, but only five each that are considered bills of general interest. Most of the insurance related bills will come under that five-bill limit, Tatman said.
“By the time it’s over I think that over 150 of the bills that can be filed under general jurisdiction will be insurance related,” Tatman said. He noted that the House of Representatives insurance committee will heavily influence whether or not legislation will pass during the session. “I would say it like [former insurance commissioner] Robert Wooley would say it: ‘It ain’t good.’ It’s bad,” he said. It will be a challenge, he added, trying to keep markets open judging by the types of measures he’s hearing may be coming out of the House.
Building codes, Citizens and more
Speaking April 18, 2007, at the Louisiana Surplus Lines Association’s annual meeting, Tatman said building codes and Citizens Property Insurance Corporation, the state’s insurer of last resort, will be targets during the session.
Feeling the pressure from constituents, some lawmakers are going to try to amend or repeal building code legislation passed after Hurricanes Katrina and Rita hit Louisiana in 2005. “You’re going to see some bills to dramatically change building codes. You’re going to see some bills that are going to try to exempt certain parts of the state that are outside of major wind fields. Or to seriously curtail building codes there. … They all vary a little bit but many of them are going to try to change statewide building codes.”
One bill targeting Citizens would do away with the 10 percent markup on rates that Citizens is required to charge. According to Tatman, the bill, by Rep. Rick Farrar (D-Rapides Parish), would make Citizens competitive with the rest of the market. “That’s not what Rick will tell you but that’s what in essence the bill will do,” he said. It would remove the 10 percent markup and require rates to be actuarially justified, Tatman said.
He said he expects to see a bill that would restore punitive damages in Louisiana, “something we had fixed about 10 years ago. It is one of the things we can actually go out and promote: We don’t have general punitive damages in Louisiana.” While he does not expect a widespread restoration of general punitive damages, he indicated it’s possible that a bill could be amended to restore punitive damages in insurance cases. “That would be very scary,” he said.
Another thing to watch out for, Tatman said, is legislation boosting the attorney general’s ability to file suit over insurance issues. SB 185 by State Sen. Julie Quinn, R-Metairie, chair of Property Insurance Task Force, would give teeth to the AG’s office by adding an insurance consumer protection officer.
Was this article valuable?
Here are more articles you may enjoy.