Lack of affordable insurance threatens Louisiana’s disaster resilience. In Lake Charles, it's a major obstacle.

Four years ago, Lake Charles experienced a slew of disasters unlike any the state of Louisiana has seen in recent history. Suffering one disaster after the other — two hurricanes, an ice storm and a flood — the city was nearly leveled by Mother Nature's successive fits.

Today, much of the city can celebrate successes in its ongoing recovery, with many homes, businesses and infrastructure restored. Accompanied by Insurance Commissioner Tim Temple, Mayor Nic Hunter at a resiliency summit last week said he's now turning his eyes to what he sees as the biggest obstacle to building a more resilient city: a lack of affordable property insurance.

"Insurance is my biggest concern for this community, and probably my biggest concern for the Gulf Coast moving forward," Hunter said. "We are doing everything humanly possible to try to make our infrastructure, our public infrastructure, more resilient, and I'm hopeful that the insurance companies see that."

To make sure they do was the first item on a long list of strategies to combat the insurance crisis, and its impact on communities like Lake Charles, presented by Louisiana Insurance Commissioner Tim Temple.

Across the state, including in Calcasieu Parish, municipalities have undertaken major projects, often with the assistance of federal dollars, to better protect their communities, such as building additional levees and improving drainage systems.

Since taking office in January, Temple said he and his staff have worked to promote strides that municipalities, businesses and homeowners have made in making their infrastructure, buildings and homes more resilient when disaster strikes — and are advocating for companies to return and offer rates that reflect the lower risk.

"If you want the credit for building stronger, more resilient homes and businesses and infrastructure — they need to know about it," Temple said. "There is a little bit of lag on what Louisiana does and what the insurance and reinsurance market has been made aware of. We've started bridging that gap."

Temple said he's met with insurance companies and other players in the industry — with some success. According to the commissioner, several companies have recently filed applications with the Department of Insurance to write policies in Louisiana, but he's hoping to see a lot more follow suit.

"It's a few, it's not a lot, and that is not a victory," Temple said. "We need to fill the void that was left."

Temple also pointed to legislation passed this year aimed at making Louisiana a more attractive market for insurance companies to operate in, despite the state's natural disadvantages.

"Louisiana was not an attractive state. Our regulatory environment was not good, our legal environment," Temple said. "We need to do a better job."

In May, Gov. Jeff Landry signed a series of bills Temple said aim to do just that, but the changes were not without controversy. The majority of the bills in the package aim to make life easier for insurance companies operating in the state by allowing them to drop policyholders and raise rates more easily, as well as have more time to pay claims after a storm.

Ben Riggs, head of the advocacy group Real Reform Louisiana, told The Times-Picayune that the package of bills, which was largely designed by Temple, was "anti-consumer" and "further stacks the deck in favor of big insurance companies."

"Commissioner Tim Temple's uncompromising, pro-industry legislative agenda gutted vital consumer protections, leaving Louisianans more vulnerable not only to storms but the whims of big insurance companies," he said.

A poll commissioned by the Times-Picayune found voters disapprove by a wide margin of one key bill in the package, to eliminate the longstanding rule that insurers can't drop policyholders after three years.

Landry has assigned the responsibility for the legislation's success in making insurance more affordable and accessible to Temple, a responsibility the insurance commissioner accepted in front of legislators.

Temple has been careful to make any predictions on the timeline and extent of the effect the new legislation will have on premiums, but pointed to reforms in Florida for a glimpse into the future, with changes taking an additional 18-24 months to show an effect on the market, after new laws were enacted.

"That's what we should expect in Louisiana," Temple said. And, "they have companies coming back to Florida."

After passing a slew of property insurance related bills in 2022 and 2023, Florida has seen insurance companies sign up with the state's office of insurance to write policies. However, Florida also experienced some of the sharpest home insurance premium increases in the entire country last year, a recent study by the National Bureau of Economic Research (NBER) found.

But Temple said he also plans to take insurance companies to task, by promoting legislation that would make them the funders of the state's fortified roof grant program.

Currently, taxpayers are funding the program which provides direct grants or tax breaks to homeowners adding and building with fortified roofs — and receive a discount from their insurance provider in exchange.

The discount varies and Temple said next year he plans to push for legislation that will make the program the financial responsibility of insurance providers. He also plans to advocate for fortified roofs to be required as part of the building code in certain parts of the state.

"We need more resilient properties and a surefire way to build a better structure that is good for you is to build a fortified roof," Temple said.

Flood insurance was another issue that was front of mind for attendees of the Lake Charles summit. While hurricanes Laura and Delta caused some of the most notable destruction, floods in May 2021 far worsened the damage.

Temple said he was working to attract more private flood insurance providers to the market, as rates in the National Flood Insurance Program for Louisiana residents have increased significantly, outpacing already steep increases in the rest of the country.

The program is administered by the federal government, which Temple noted places it outside of his purview, but if there was ever a time for Louisiana to take on the issue on the federal level, he pointed out, it was now.

"Your congressional delegation is as strong as it's ever been. We've got the speaker of the House. We got the majority leader from Louisiana," Temple said. "If any congressional delegation could get anything done, it would be this one."