Thousands of Louisianans will lose home insurance coverage this month

NEW ORLEANS (WVUE) – With the hurricane season In progress, thousands of Louisiana policyholders face a storm of insurance cancellations within days. And many are not happy, as well as some insurance agents.

Sofia Dheming has no choice but to take out new home insurance.

“We have a few quotes, the highest I got was around $9,000, so that was around three times the amount we were originally paying. And then we went down to $4,700 and that’s a lot of deductions that we took out, things that we might need but we had to make it work,” Dheming said.

She had received a letter a day earlier informing her that her insurance would be terminated as of June 22, 2022.

Some insurance agents have hundreds of customers who are impacted by upcoming cancellations.

Ross Fayard, owner of Amstate Insurance, says his phone is flooded with people desperate for insurance.

“I turned off my cell phone from 8 a.m. to 5 p.m. I turned it on and got 198 text messages three days in a row. People desperately need home insurance,” Fayard said.

He says Insurance Commissioner Jim Donelon needs to act.

“This needs to be fixed and the only one who can fix it is Jim Donelon, he needs to fix it or he needs to quit. Those are cold hard facts because I’m dealing with people crying all day not knowing what to do This can be fixed, this can be fixed,” Fayard said.

“Please help us,” Dheming said.

FOX 8 requested an interview with Donelon but his office was unable to respond by our deadline.

John Ford, Deputy Commissioner of the Louisiana Department of Insurance Public Affairs Division, made the following statement to FOX 8:

“Lighthouse Excalibur is a bankrupt insurer that went into receivership in April of this year. The company had around 29,000 policyholders when it went into receivership. The policyholders have been told by the receiver (the person who operates the company while it is in receivership) that their policy with Lighthouse will be canceled effective June 22. All policyholders who have not yet obtained a new insurance policy should contact an insurance agent now for assistance. find a policy for their home before their coverage is void. For help finding an agent, please visit ldi.la.gov and click on the link to find an agent on our homepage.

And Ford confirmed that other policyholders with another insurer, Maison, were losing coverage at the end of this month.

“Maison has been unable to obtain reinsurance for this year’s hurricane season, which means it is unlikely they will be able to meet their obligations to policyholders in the event of a hurricane. Because ‘they were at risk of becoming insolvent without reinsurance, they were able to cancel the policies. This is a different reason from Lighthouse, which was insolvency, but similar for policyholders in that they will need to contact an agent and find a new policy before the cancellation date of June 30. It is very important that people know that they need to contact an agent, because if the policyholder/agent is unable to find a policy on the private market , the agent can obtain a policy from Louisiana Citizens, which is our insurer of last resort,” he said in an email to FOX 8.

After Hurricane Ida in 2021, insurance premiums are rising for many policyholders.

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“We now have carriers taking policies and the rate increase is 40%, 50%. I don’t care if anybody stands up here and says, oh it doesn’t go that high. I know, my office is a huge insurance agency. We see renewals going from $2,000 to $4,000 or $5,000 every day,” Fayard said.

Dheming is also a real estate agent and sees the impacts of the current insurance landscape on buying a home.

“Flood insurance is going up like it is, now we have home insurance that’s going to go up and you know the interest rates are going up,” she said.

Fayard says people replacing their roof should be sure to let their insurance company know, as it could result in a financial benefit.

“Take two pictures of your roof, front and back, get a paid receipt, send it to your agent, ask your agent to make sure you get the discount on the new roof, it can be anywhere from a thousand to 2 $000 in credit. A lot of people don’t know that,” he said.

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Justin D. O'Neill