RDCSB412 2549 4900
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
SB 412 Reengrossed 2022 Regular Session Talbot
Present law creates the Insure Louisiana Incentive Program (program).
Present law provides Louisiana is experiencing a crisis regarding the availability and
affordability of insurance for residential and commercial properties from the catastrophic
losses in 2005 from hurricanes Katrina and Rita.
Present law provides that underwriting practices have resulted in property owners having to
obtain property insurance or coverage for wind peril from Louisiana Citizens Property
Insurance Corporation (Citizens).
Present law provides that Citizens has a substantial deficit as a result of those storms and
requires both insurers and policyholders to be charged assessments to fund Citizens' deficit.
Present law provides that some property owners were forced to sell or abandon their
properties or they have been prevented from repairing their storm-damaged properties, and
some residents have left the state without returning.
Present law provides that Louisiana has a vital interest in fostering the availability of
property insurance at a reasonable cost.
Proposed law retains present law but changes the year of the storms from "2005" to "2020
and 2021", changes the names of the hurricanes from "Katrina and Rita" to "Laura, Delta,
Zeta, and Ida", and deletes the provision of present law that requires insurers and
policyholders to be assessed charges to fund the deficit of Citizens.
Present law requires the commissioner of insurance (commissioner) to issue a public
invitation to insurers to submit grant applications upon the implementation of the program
and prohibits the commissioner from allocating individual grants less than $2 million nor in
excess of $10 million in the initial applications and requires the commissioner to initially
allocate 20% of the total funds to domestic insurers.
Present law requires the commissioner to offer a second invitation if all monies from the first
invitation are not allocated and requires the commissioner to offer a second invitation and
prohibits the commissioner from allocating individual grants less than $2 million nor in
excess or $10 million but authorizes insurers who received a grant in response to the first
invitation to apply for an additional grant up to a $10 million limit.
Present law requires the commissioner to offer a third invitation if all monies from the
second and third invitation are not allocated and prohibits the commissioner from allocating
individual grants less than $2 million nor in excess of $10 million but authorizes insurers
who received a grant in response to the first and second invitation to apply for an additional
grant up to a $10 million limit.
Proposed law retains present law but authorizes the commissioner to issue a second and third
invitation instead of requiring the commissioner to issue a second and third invitation.
Present law provides that once the three separate invitations and responses have been
finalized, the commissioner is required to direct any unexpended or unencumbered funds and
any matching capital grant funds not earned to be used for the property insurance tax credit
but provides that if the amount of funds in the program is less than $35 million after the
three separate invitations have been finalized, the funds are to be used to accelerate payoff
of the Unfunded Accrued Liability of the state retirement systems.
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Proposed law retains present law but deletes the three separate invitations provision and
changes the unallocated money designation from funds less than $35 million being allocated
to the Unfunded Accrued Liability of the state retirement systems to funds being reverted
back to the state general fund.
Present law provides that grants shall be made only to insurers who have capital and surplus
exceeding $25 million.
Proposed law changes the minimum capital and surplus requirement from $25 million to $10
million.
Present law authorizes non-admitted insurers and approved unauthorized insurers to apply
for a grant, if the insurer becomes admitted and licensed to do business in this state and
requires the commissioner to reallocate funds the insurer was to receive if the insurer does
not apply timely or is not admitted and licensed in this state.
Proposed law retains present law but removes non-admitted insurers and approved
unauthorized insurers and adds surplus lines insurers.
Proposed law changes the licensing requirement to a certificate of authority requirement.
Present law requires the commissioner to promulgate rules to establish procedures to
monitor the net written premium of insurers receiving a grant and to ensure that an insurer
complies with the provisions of present law.
Present law requires the commissioner to provide rules for returning grant money to the
state on a pro rata basis, if the insurer fails to comply with present law.
Present law requires the commissioner to seek the return of unearned grant money from an
insurer, if the insurer has not complied with the rules for five consecutive years commencing
on January 1, 2009 and ending December 31, 2013.
Proposed law retains present law but changes the dates from "January 1, 2009" and
"December 31, 2013" to "January 1, 2024" and "December 31, 2028", respectively.
Proposed law establishes the Insure Louisiana Incentive Fund as a special fund in the state
treasury for the financing of grants awarded pursuant to proposed law. Provides that monies
in the fund shall be invested in the same manner as monies in the state general fund and any
interest earned on investment of fund monies shall be credited to the fund. Further provides
that unexpended and unencumbered monies in the fund at the end of the fiscal year remain
in the fund.
Effective August 1, 2022.
(Amends R.S. 22:2361-2370; Adds R.S. 22:2371)
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Insurance to the original
bill
1. Makes technical changes.
Senate Floor Amendments to engrossed bill
1. Makes technical change.
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Insurance to the
reengrossed bill:
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1. Change the minimum capital requirement for insurers to qualify for a grant
through the Insure Louisiana Incentive Program from $25,000,000 to
$10,000,000.
2. Remove the requirement that 25% of the net written premium for policyholders
whose property was formerly insured by the Louisiana Citizens Property
Insurance Corporation and at least 50% of the policyholders have property
located in the parishes included in the federal Gulf Opportunity Zone Act of
2005 in Louisiana for insurers to qualify for a grant under the program.
3. Make technical changes.
The Committee Amendments Proposed by House Committee on Appropriations to the
reengrossed bill:
1. Establish the Insure Louisiana Incentive Fund in the state treasury to fund the
grants awarded pursuant to proposed law.
2. Make technical changes.
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