ENROLLED
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ACT No. 397
Regular Session, 2010
HOUSE BILL NO. 952
BY REPRESENTATIVE KLECKLEY
AN ACT1
To amend and reenact R.S. 22:2314(B), (C)(introductory paragraph), (1), and (2), and (D),2
relative to the Louisiana Citizens Property Insurance Corporation; to authorize3
certain activities by the corporation; to provide for policies issued by the corporation;4
to provide for a policy take-out program for the depopulation of Louisiana Citizens5
Property Insurance Corporation; and to provide for related matters.6
Be it enacted by the Legislature of Louisiana:7
Section 1. R.S. 22:2314(B), (C)(introductory paragraph), (1), and (2), and (D) are8
hereby amended and reenacted to read as follows: 9
ยง2314. Policy take-out program10
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B.(1) Not less than once per calendar year, the corporation shall offer all of12
its in-force policies for removal to the voluntary market. The in-force policies shall13
be bundled in groups of not less than five hundred policies and include both policies14
issued under the Coastal Plan and the FAIR Plan. The corporation shall include15
policies in the bundle offers for depopulation policies with all available geographic16
and risk characteristics that serve to reduce the exposure of the corporation.17
(2) Notwithstanding any other provision of law to the contrary, the bundles18
must include both of the following:19
(a) Twenty-five percent of the policies which are bundled must be policies20
which provide coverage to structures located in R.S. 40:1730.27.21
(b) At least seventy-five percent of which net premiums are received from22
policyholders shall be from insurance policies covering single-family residential23
structures, residential duplex structures, or residential fourplex structures.24 ENROLLEDHB NO. 952
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(2) Each insurer participating in the take-out program shall be offered all of1
the corporation's in-force policies. In response, the insurers shall provide the2
corporation with a list of policies they propose to take out subject to authorization3
by the policy's agent of record. No policy shall be assumed by a take-out company4
without the authorization of the agent of record.5
C. Each insurer admitted to write homeowners insurance or insurance6
insuring one- or two-family owner occupied premises for fire and allied lines or7
insurance which covers commercial structures in the state of Louisiana may submit8
a take-out plan to the corporation for the bundled policies apply to the Louisiana9
Citizens Property Insurance Corporation to become a take-out company. The10
corporation shall submit each take-out plan to the Department of Insurance for11
review and approval Insurers will be approved to participate in the depopulation of12
the Louisiana Citizens Property Insurance Corporation based on the following13
criteria:14
(1) The capacity of the insurer to absorb the policies proposed to be taken15
out of the corporation and the concentration of risks of those policies. Such capacity16
may be evidenced by providing to the Louisiana Citizens Property Insurance17
Corporation a copy of a valid certificate of authority issued by the Louisiana18
Department of Insurance to the insurer. An insurer shall not be qualified to submit19
a take-out plan participate in the take-out program unless that insurer has at least an20
A- a B+ rating with A.M. Best, or its equivalent. In no event shall the surplus21
requirements of the take-out company be less than the surplus requirements of any22
other company in the state of Louisiana.23
(2) Whether An insurer shall have the rates proposed to be charged for the24
policies being taken out, filed, and approved by the Louisiana Department of25
Insurance with an effective date prior to the assumption of policies. The insurer shall26
provide proof to Louisiana Citizens Property Insurance Corporation that the rates27
have been approved and are adequate under R.S. 22:1451 et seq.28
* * *29 ENROLLEDHB NO. 952
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D. If a take-out plan is approved by the Department of Insurance, the The1
corporation shall submit it an insurer's application to participate to the governing2
board for approval.3
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Section 2. This Act shall become effective upon signature by the governor or, if not5
signed by the governor, upon expiration of the time for bills to become law without signature6
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If7
vetoed by the governor and subsequently approved by the legislature, this Act shall become8
effective on the day following such approval.9
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: