Fair Claims Handling Laws

The Problem

• People in Louisiana are not happy with the way insurance claims were settled after Hurricanes Laura, Delta, Zeta, and Ida.  

• People feel helpless. When insurance claims are taking too long to settle, you, as the policyholder, have few options: 
  • Comply with the insurance company’s demands, or 
  • Hire an attorney 

• Claims should be resolved to the satisfaction of the policyholder WITHOUT needing  to hire an expensive attorney 

• At the same time, the cost of Homeowners Insurance is higher than ever 

• One significant factor in that cost is the expense of excessive lawsuits 
• Louisianians are 12 times more likely to sue their Homeowners insurer than other coastal states  
• Louisiana sues Homeowners Insurance companies more than other states because of our vague fair claims handling laws 
• The cost of all these lawsuits are passed on to the people of Louisiana, in the high cost of Homeowners Insurance 

The Solution

• We need to clearly define Louisiana’s fair claims handling laws. 

• The law must allow policyholders to force the insurance company to pay what they owe after a storm, without needing to hire an attorney. 
  • Providing a clear claims process helps policyholders by establishing the rules they can follow to force insurers to fairly pay their claim.
  • A clearly defined claims process also helps insurance companies by reducing the number of excessive lawsuits, when policyholder needs are met without a trial 

• When an insurance company is intentionally underpaying, delaying payment, or otherwise hurting policyholders, they should be heavily penalized. However, the law must limit excessive lawsuits in cases where the insurer is doing everything that they should for a policyholder.  

• HB 678 by Representative Gabe Firment and SB 323 by Senator Kirk Talbot offer that solution.