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Louisiana Property & Casualty Insurance Commission (LPCIC) Update


The Homeowners Ad Hoc Committee of the Louisiana Property and Casualty Insurance Commission (LPCIC) met earlier this month to delve further into the wind mitigation issues that were raised in a meeting of the full LPCIC this past October. PIA's Secretary/Treasurer Manuel DePascual chairs this group and oversaw an informative and active discussion of some of the experiences and problems that have arisen in implementing and encouraging retrofit to the wind mitigation measures that are the basis of the Louisiana Uniform Construction Code. Senator Dan Morrish serves as Vice Chair.

Guest speakers included Barry Gates, Vice President of Product Management at Bankers Insurance Company on wind mitigation in Louisiana and Donald Griffin, Vice President of Personal Lines at the Property Casualty Insurers Association of America on wind mitigation in other states. Due to a prior commitment Mary Frances Fournet, Vice President of Product Management at American Strategic Insurance Corporation, sent a statement on wind mitigation in Louisiana that was read into the record.

These speakers were joined by a panel consisting of: Ray Kothe, Chairman of the Louisiana State Uniform Construction Code Council; Randy Noel, Board Member and Immediate Past Chair of the LSUCCC and Bill Hatchett, Partner of Wind Mitigation Surveyors. Panel members from the Louisiana Department of Insurance included Ed O'Brien, Deputy Commissioner of Property & Casualty; John Lamke from the Office of Consumer Advocacy and Rachelle Carter, Director of P&C Policy Forms.

Committee members actively participated in the discussion which covered some of the following issues:

Wind mitigation is the structural designs, construction techniques and materials that have been proven to avoid or reduce damages from hurricanes. Some retrofitting can be more easily and economically accomplished — such as bracing of garage doors, hanging exterior doors to open out and installing a secondary water barrier when re-roofing. But some measures are expensive and interdependent — such as rafter-to-wall strapping is dependent on wall-to-foundation fastening for maximum effectiveness.
Continue to learn from Florida's lengthy experience in wind mitigation — both the good and the bad. In particular, do not impose on insurers a specific premium credit for specific wind mitigation measures, but do adhere to a rigorous inspection program to assure that construction and the materials used meet or exceed Code requirements in every construction.
It will take time for Louisiana to realize all the benefits of wind mitigation. Insurers rely on catastrophe modelers — who are starting to consider wind mitigation — to estimate coastal risk. They rely on reinsurers — who do not give much credit to wind mitigation — to assume some of the insurers' coastal risk. Some homeowners in coastal and southern parishes are still having trouble finding insurance in the voluntary market. It is difficult in these economically challenging times for these homeowners to see the benefit in retrofitting their homes when there is no guaranty that the investment will generate more available and affordable insurance options.
Education and consumer awareness are vital to successful wind mitigation. Contractors, wind mitigation surveyors, insurance agents and homeowners all must become fully aware of the specific measures, insurance premium discounts and long-term savings to those who build or retrofit to the Code or the more stringent standards of IBHS.

The Homeowners Ad Hoc Committee and LPCIC will continue to gather information and research these issues.







Thanks to Our 2018 PIA Partners:

Capital Premium Financing


Excalibur National Insurance Company


LUBA Workers' Comp

Markel FirstComp

SageSure Insurance Managers, LLC

Stonetrust Commercial Ins. Co.