SLS 14RS-460 ENGROSSED
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Regular Session, 2014
SENATE BILL NO. 181
BY SENATOR MORRISH
PROPERTY INSURANCE. Provides with respect to the Louisiana Citizens Insurance
Corporation policy take-out program. (8/1/14)
AN ACT1
To amend and reenact R.S. 22:2314(C)(3), relative to the Louisiana Citizens Insurance2
Corporation policy take-out program; to provide with respect to ownership of a3
policy by a take-out company; and to provide for related matters.4
Be it enacted by the Legislature of Louisiana:5
Section 1. R.S. 22:2314(C)(3) is hereby amended and reenacted to read as follows:6
ยง2314. Policy take-out program7
* * *8
C. Each insurer admitted to write homeowners insurance or insurance9
insuring one- or two-family owner occupied premises for fire and allied lines or10
insurance which covers commercial structures in the state of Louisiana may apply11
to the Louisiana Citizens Property Insurance Corporation to become a take-out12
company. Insurers will be approved to participate in the depopulation of the13
Louisiana Citizens Property Insurance Corporation based on the following criteria:14
* * *15
(3) The rates which are charged by the company submitting a take-out plan16
must comply with R.S. 22:2303 in the first year that the company charges premiums17 SB NO. 181
SLS 14RS-460 ENGROSSED
Page 2 of 2
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
to the customer. During the second and subsequent third years of coverage, the take-1
out company shall apply to the Department of Insurance for rates which are2
actuarially justified, but in no case may the rates be greater than those authorized in3
R.S. 22:2303.4
* * *5
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Cheryl Horne.
DIGEST
Morrish (SB 181)
Present law permits each insurer admitted to write homeowners' insurance or insurance
insuring one- or two-family owner occupied premises for fire and allied lines or insurance
which covers commercial structures in the state of La. to apply to the La. Citizens Insurance
Corporation to become a take-out company. Further provides that insurers will be approved
to participate in the depopulation of Citizens based on the following criteria:
(1)The capacity of the insurer to absorb the policies proposed to be taken out of the
corporation and the concentration of risks of those policies.
(2)An insurer shall have the rates proposed to be charged for the policies being taken
out, filed, and approved by the Dept. of Insurance with an effective date prior to the
assumption of policies.
(3)The rates which are charged by the company submitting a take-out plan must comply
with present law in the first year that the company charges premiums to the
customer. During the second and all subsequent years of coverage, the take-out
company shall apply to the Dept. for rates which are actuarially justified.
Proposed law provides that during the second and third years of coverage only, the take-out
company shall apply to the Dept. of Insurance for rates which are actuarially justified.
Effective August 1, 2014.
(Amends R.S. 22:2314(C)(3))