Louisiana Urges Insurers to Extend Deadlines
Louisiana Insurance Commissioner Jim Donelon recently urged all property and casualty insurers in the state to extend the deadline for homeowners to file insurance claims from the historic 2020 storm season.
The Commissioner issued Bulletin 2021-02 which urges insurers to give policyholders more time to demonstrate damage to their properties after last year’s record hurricane season. Policyholders typically have 180 days to file proof that they suffered losses from last year’s hurricanes.
The 180-day deadlines for Hurricane Laura, Delta and Zeta are quickly approaching with the deadline for Laura coming on February 23, 2021. It is possible that the mandatory evacuations issued for Laura will extend those deadlines a bit.
The Commissioner also provided guidance regarding replacement cost coverage in his Bulletin as well as reminded insurers about Louisiana’s “three-year homeowners protection law” which, limits cancellations and non-renewals after major storms.
In addition to urging insurers to extend deadlines, Commissioner Donelon also encouraged policyholders to be aware of the approaching deadlines and to file claims within those deadlines because in the end, Bulletin 2021-02 is simply a request for insurers to extend their deadlines, legally, they are not required to do so.
“Although I encourage policyholders to file their claims with their insurers as soon as possible to begin the recovery process, I know the level of damage caused by the 2020 hurricanes makes it very difficult for people to gather all of the information and documentation they need to file a detailed proof of loss to support their claim,” Commissioner Donelon said in the bulletin. “I am requesting that insurers take into account the negative impact that multiple hurricanes within a short period of time have had on policyholders in their efforts to repair their property and lives and to show some mercy.”
The commissioner encourages policyholders to be aware of the deadlines and work with their insurance company to make sure they get their claim filed on time and inform their insurer about complications they may be experiencing such as material shortages or difficulty getting a contractor to come out to give them an estimate or complete the work.
Simply sending an email to your insurer documenting your issues and asking for an extension can often be enough, legally, insurers have to respond to all inquiries within 14 days. The bulletin also encouraged policyholder to familiarize themselves with the Policyholder Bill of Rights (La R.S. 22:41), which was enacted after hurricanes Rita and Katrina
Deadlines to Keep in Mind
Here is a quick overview of approaching deadlines as well as an overview of laws protecting policyholders:
The following are the approximate proof of loss filing deadlines for last year’s hurricanes:
- Hurricane Laura Aug. 27: Filing Deadline – Feb. 23, 2021
- Hurricane Delta Oct. 9: Filing Deadline – April 7, 2021
- Hurricane Zeta Oct. 28: Filing Deadline – April 26, 2021
You should review your policy or contact your agent for your exact deadline as it can vary by policy. If you were denied access to your property by the authorities (police, fire dept, others) you should have a few extra days to file your claim. If necessary, contact your agent or adjuster to confirm what documentation you need to fulfill your policyholder’s proof of loss obligation. Proper documentation often includes your initial damage claim, videos or photos of the damage, contractor estimates, receipts for temporary repairs and any other documentation required by your insurance company.
Louisiana’s Three-Year Homeowners Protection Law
In Louisiana, there are laws that limit the circumstances under which an insurer can cancel or non-renew a homeowners policy once they’ve had coverage for three years.
The laws (La R.S. 22:1265 and La R.S. 22:1333) state that property insurers cannot cancel or non-renew a policyholder that who has been a customer for more than three years unless they are not paying their premium, they commit insurance fraud, they file two or more non-Act of God claims within three years, there is a “material change in risk” of the insured property, or the insurer is at risk of becoming insolvent.
Replacement Coverage
If you have a replacement value coverage policy, there are additional deadlines you need to be aware of in the state of Louisiana.
Replacement coverage will reimburse policyholders the cost of repairing their home or replacing a personal possession without a deduction for depreciation. As an example, if your 12-year-old roof is severely damaged or destroyed during a hurricane and you have a replacement coverage, your insurer should pay the full cost to replace the roof, without deducting for the fact that the roof was 12 years old at the time of the claim.
An actual cash value policy on the other hand takes into account depreciation so you would have to cover a large portion of the replacement cost of the roof.
Many insurance companies will start by paying a policyholder the actual cash value for the roof or personal possessions and then reimburse them for the full amount once the damage has been fully repaired or the item has been replaced. Policies will often require you to replace the item and submit documentation to receive the balance of the reimbursement.
According to state law, you have one year from the date of loss or receiving a claim payment, whichever is later to file your additional documentation to receive full reimbursement.
Prescriptive Period
The final law that homeowners should be aware of is the prescriptive period. If you are unable to come to an agreement with your insurer regarding your claim you have the right to file a lawsuit against them. The deadline for filing a lawsuit is 24 months after the day of the claim.