Commissioner Donelon Issues Final Update on Successful Incentive and Fortify Homes Programs

Insurance Commissioner Jim Donelon provided an update on the Insure Louisiana Incentive Program and the Louisiana Fortify Homes Program, both of which were implemented with support from Governor John Bel Edwards and the Louisiana Legislature to address the ongoing crisis in our state’s property insurance market.

“The Insure Louisiana Incentive Program and the Louisiana Fortify Homes Program are both meeting the high expectations I had in 2023,” said Commissioner Donelon. “I’m grateful for the state leaders who came together on a broad, bipartisan basis to set our property insurance market on a clear path to recovery following the devastation of the 2020 and 2021 hurricane seasons.”

Insure Louisiana Incentive Program

Earlier this year, the legislature allocated a total of $55 million to the Insure Louisiana Incentive Program, a re-enactment of a the nearly identical program used to revitalize Louisiana’s property insurance market after hurricanes Katrina and Rita caused large insurance companies to flee the state in the years following those storms.

With approval from the legislature, the Louisiana Department of Insurance (LDI) used Incentive Program funding to issue grants to seven companies earlier this year. Through November 30, those companies have collectively written over 50,000 policies. Notably, the top five parishes for new policies are Jefferson (8,923), Orleans (4,991), St. Tammany (4,429), Terrebonne (3,254) and Lafayette (3,237).

LDI data shows approximately 24,000 of those policies have been taken from or avoided going into Louisiana Citizens through the first eight months of the program. Additionally, incentive companies have tentatively selected over 50,000 policies for Citizens depopulation by mid-2024. That number is not final, and agents do have the final say as to whether those policies will be moved out of Citizens, but it is a strong sign that insurers are ramping up their writing in Louisiana’s most vulnerable areas.

In December, the Joint Legislative Committee on the Budget approved the LDI’s request to issue six additional Incentive Program grants, including one grant to a new company.

“While there is certainly much work yet to be done in addressing the extremely difficult property insurance market coastal Louisianans are still facing, I can report that the Incentive Program is exceeding expectations,” said Commissioner Donelon.

Louisiana Fortify Homes Program

The legislature allocated a total of $30 million in 2023 to the Louisiana Fortify Homes Program, which was copied from the Strengthen Alabama Homes Program. Alabama’s program has funded over 6,000 FORTIFIED roofs in the past seven years. More importantly, their program’s success brought so much attention to the benefits of building stronger that about 34,000 other Alabama residents have upgraded their roofs to the more resilient FORTIFIED standard.

In Louisiana, we have accepted 3,000 applicants, of which the first 1,500 were required to be Citizens policyholders. I am confident the Louisiana Fortify Homes Program will be successful not only in providing grants for the 3,000 roofs we have funding to install, but also in encouraging tens of thousands more Louisianans to build stronger in the years ahead.

“The new law requiring insurers to provide discounts to homeowners who have FORTIFIED roofs is so far resulting in an average discount of about 20% off the total premium, as well as about a 24% discount for Citizens policyholders in coastal Louisiana,” said Commissioner Donelon. “I firmly believe that if we build high enough and strong enough, we can live and work with 150 mph hurricanes making landfall on our coast from Grand Isle to Holly Beach.”