FOR IMMEDIATE RELEASE

March 17, 2021

Commissioner Approves Rate Revisions for LA Citizens Personal Property Book of Business

Despite three hurricanes and two tropical storms striking Louisiana last year, residential property insurance rates for Louisiana Citizens Property Insurance Corp. (Citizens) will rise by only 2.3% this year, Louisiana Insurance Commissioner Jim Donelon announced.

The increase is in line with current inflation rates and evidences stability and appropriate rates in Louisiana’s residential insurance market. By law, rates at Citizens, Louisiana’s market of last resort, must be higher than the private market for home insurance.

“Citizens is currently in a strong financial place despite the multiple hurricanes that hit Louisiana during the last storm season, resulting in a minimal overall increase needed to continue to provide property insurance to Louisiana’s most vulnerable policyholders across the state,” said Commissioner Donelon.

Citizens insures properties that can’t find coverage in the private market. Many of these properties, residential as well as commercial, are in locations where private insurers don’t want to do business, including approximately 1,000 policies in the Shreveport area and 1,000 in the Monroe area.

Commissioner Donelon approved the rate filing of +2.3% for personal property policies in the FAIR and Coastal Plans this month after the proposed rate change was found to be appropriate based on actuarial and market analysis in compliance with Louisiana law.

The rate change will affect approximately 34,400 policies and takes effect for both new and renewing policies starting on June 1.

The new rates are in line with those in the previous five years, as outlined below.

In January, Citizens completed its 14^th round of depopulation in which selected policies are made available to private insurance companies with the goal of lowering premiums for policyholders in the Louisiana market. Because of its strong reinsurance program, Citizens estimates that it will pay only $35 million of the estimated $97 million in claims it will receive for the 2020 hurricane season, with reinsurance companies paying the rest.

“The rate trends, depopulation success and strong reinsurance program we are seeing with Citizens is a testament to the hard work of Citizens’ management team and the excellent stewardship of its Board of Directors,” Donelon added.

About the Louisiana Department of Insurance: The Louisiana Department of Insurance works to improve competition in the state’s insurance market while assisting individuals and businesses with the information and resources they need to be informed consumers of insurance. As a regulator, the LDI enforces the laws that provide a fair and stable marketplace and makes certain that insurers comply with the laws in place to protect policyholders. You can contact the LDI by calling 1-800-259-5300 or visiting www.ldi.la.gov.