BATON ROUGE [AP] — Louisiana’s property insurer of last resort is turning over 13,466 policies to four private companies, leaving about 119,000 policies under its control, insurance officials say.
The head of Louisiana Citizens Property Insurance Corp., Richard Robertson, said the latest turnover to private-sector insurers is a bit larger than had been anticipated. Robertson told The Times-Picayune that officials had expected 7,000 to 8,000 switchovers.
Insurance Commissioner Jim Donelon said the policyholders now have the option to go to a new company, usually at a lower premium than Citizens, or remain with the state insurer. Donelon said 99 percent of policyholders typically opt for a private insurer.
Donelon said the Citizens book of business will stand at 119,000, down from 174,000 in the aftermath of Hurricanes Katrina and Rita in 2005.
Since 2008, 56,772 state-insured policies have been placed with private insurers.
The most policies taken off of Citizens’ books came during the first round of solicitations of private companies in June 2008 when 26,595 were taken. The present round is the second highest number removed, slightly ahead of the 13,343 taken away from Citizens in December 2008, Donelon said.
Private companies in April 2009 removed 3,368 policies from the Citizens pool.
Citizens now has less than 6 percent of the homeowners market in the state, ranking it fifth or sixth largest, Donelon said. At one point a few years ago, Citizens was the third largest homeowners insurer with almost 8 percent of the market.
Robertson said most of the policies will be assumed by two of the four companies who participated in the latest round.
Southern Fidelity Insurance of Tampa, Fla., will assume about 8,000 policies, he said, and Lighthouse Property Insurance Co. of Long Island, N.Y., will take over about 5,300.
“The message here is that these takeout companies are feeling there is good business in Louisiana Citizens’ policies,” Robertson said.
