Florida and Louisiana Take on Huge Debts for Hurricane Insurance Claims
Monday, May 22nd, 2023 Catastrophe Insurance Industry PropertyIn an emergency financial maneuver, the state-chartered insurance associations of Florida and Louisiana have been forced to borrow a combined $1.3 billion to cover insurance claims caused by worsening hurricanes.
The nonprofit insurance associations were already a backstop measure, stepping in after 2022’s Hurricane Ian drove insurance companies in the Gulf Coast into failure, causing the cancellation of tens of thousands of homeowners’ policies and leaving millions in unpaid claims. But those unpaid claims were so high that the associations have had to turn to emergency borrowing of hundreds of millions of dollars at significant interest rates.
‘We’re currently in the midst of an insurance crisis,’ Jim Donelon, Louisiana’s insurance commissioner, said in a news briefing. The crisis is ‘largely...a result of hurricane activity in our state the last couple of years.’
