Named-Storm Deductibles: Louisiana Legislators Want Just 1 Yearly

September 22, 2008

The chairman of Louisiana’s Senate Insurance Committee says he will ask companies to use the percentage deductible for named storms only once for homes or businesses hit by both hurricanes this year.

Senator Don Cravis, a Democrat from Opelousas, says he, the chairman of the House Insurance Committee and Insurance Commissioner Jim Donelon are considering a bill to make such a limit mandatory.

Many insurance companies are setting deductibles for named storms as a percentage of a property’s value – up to 5 percent. That could mean payments of up to $10,000 – $5,000 per storm – for someone whose $100,000 house has a 5 percent named storm deductable and was hit by both hurricanes Gustav and Ike.

Donelon told the committee on that he could support a one-storm limit. But he said banning the special deductibles entirely would keep many companies from selling insurance in Louisiana.

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