Property insurers are fleeing climate-vulnerable areas around the country to avoid massive payouts. In Louisiana, lawmakers have a plan to lure them back. The GOP-controlled state Legislature passed a bill this week that would make it easier for insurers — many recently bankrupted by four major hurricanes — to drop their riskiest properties, write Adam Aton and Thomas Frank. The move would repeal a law, instituted after Hurricane Katrina, that prevented insurers from dropping policies that had been renewed for three years or from raising the deductibles of those policies. The Louisiana bill is just the latest gyration in the havoc that climate-fueled disasters are wreaking from Florida to Texas to California, and beyond. Under the Louisiana legislation — which Republican Gov. Jeff Landry is expected to sign — insurance companies could drop 5 percent of their policies, or more with the state’s permission, as long as they aren’t concentrated in a single parish. “We are in a crisis,” said state Rep. Chad Brown, the Republican vice chair of the House Insurance Committee and a supporter of the bill. Insurance companies need more flexibility if they’re going to stay in the state, he said, even though that “may not be popular with some people.” Critics of the bill said it could simply shift the liability of risky properties from private companies onto the state’s program. People who cannot find private policies are forced to buy property coverage from a state-chartered insurer — often at a premium of 10 percent or more. State Rep. Matthew Willard, a Democrat from New Orleans who opposed the measure, said his constituents would bear the brunt of the changes. “People are losing generational homes — where they grew up in, their parents grew up, maybe even their grandparents grew up — because they can’t afford” insurance, he said. While the measure garnered some Democratic support, it passed on a largely party-line vote. In the short term, some people may pay more for insurance, proponents admitted. But they argued that was necessary to keep insurers in the state — ensuring more competition and lower rates over time. Any way you slice it, insuring properties in vulnerable areas is increasingly expensive. Policymakers around the country continue to grapple with who foots the bill.
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