Tim Temple: Big reforms are needed to solve La's auto insurance crisis. Here's how.

When I took office last January, Louisiana was stuck in a property insurance crisis sparked by the devastating hurricanes of 2020 and 2021 and intensified by our state's overly burdensome regulatory environment.

Last year, I worked with legislators to develop a comprehensive package of property insurance reform to get insurers writing new business in Louisiana again. That package was quickly passed with broad, bipartisan support from the Legislature and Gov. Jeff Landry.

We have more to do to make sure home and business owners across the state benefit from these changes, but the data shows we are already trending in the right direction with 10 newly licensed homeowners insurers, a reduction in the severity of rate increases and significantly more insurers taking a rate decrease in 2025.

While our property insurance market is on the upswing, I am sorry to say our long-standing auto insurance cost crisis is not on the same path — at least not yet.

There is no doubt our private passenger and commercial auto markets are in disastrous shape. We consistently rank as the most unaffordable state for auto insurance in the country. Louisiana drivers pay close to twice as much as drivers in our neighboring states just for living inside our borders. In meetings with loggers, big truck drivers and business owners, I am consistently told there are few or no options for affordable insurance — and many are considering a move out of state because of it.

You might think our high rates are driven by insurer profit, but the data shows that is not the case. Over the past 10 years in Louisiana, private passenger auto insurers have an average annual underwriting loss of 7.6%, which means they are losing money at three times the national average. They do even worse on the commercial side, taking a loss of 30.9%, which is six times the national average.

The reason Louisiana families and business pay so much for auto insurance is not a mystery. Study after study shows that our high rate of medical and legal utilization is the primary problem in our state.

Proponents of the status quo say we have tried legal reform for years and it has not done anything to curb our insurance costs. Well, they are half right. We have tried to pass meaningful legal reform — but we have failed by passing watered-down "compromise" legislation that is politically beneficial in the short term but totally ineffective at addressing the root causes of our high auto insurance rates.

But it doesn't have to be the same this year.

Since the last session ended, I have worked with lawmakers to develop legislation that fixes the real problems in our legal system by addressing medical billing transparency, comparative fault, general damages and other areas where we do things differently than states with more affordable auto rates.

These solutions will be attacked as harmful by those who oppose them, but the bills we are proposing address the foundational issues that cause our drivers to pay the highest auto insurance rates in the nation. We will continue paying them until we make these necessary legal and insurance reforms.

The time for talk is over. If we can't get true legal reform passed and signed by the end of this session, it will be time to change the game once and for all. If our legal reform efforts fail, I will propose the creation of a new entity called the Louisiana Commercial Automobile Corporation (LCAC).

Based on the extremely successful Louisiana Workers' Compensation Corporation that was created to solve the workers' comp crisis in the 1980s and '90s, the LCAC would be a legislatively created private entity designed to bring fairness and stability to the commercial market by statutorily limiting excessive claims, setting medical reimbursement rates and capping attorney fees.

The LCAC would solve two problems. First, it would provide affordable insurance for businesses that have no realistic commercial auto options under the current system. Second, it would demonstrate the degree to which our legal system is corrupting our auto insurance market and finally pave the way for comprehensive legal reform.

I ran for office to make all types of insurance more affordable for the people of Louisiana. I will not accept the status quo in which we all suffer from high auto insurance rates for the benefit of a very few.

One way or another, now is the time to fix this problem.