HLS 25RS-532 ENGROSSED
2025 Regular Session
HOUSE BILL NO. 438
BY REPRESENTATIVE FIRMENT
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
INSURANCE/RATES: Provides relative to advertising expenses and prohibits use of
certain expenses in setting insurance rates
1 AN ACT
2To amend and reenact R.S. 22:1452(C)(introductory paragraph) and (7) and 1454(B)(3) and
3 to enact R.S. 22:1452(C)(9.1), relative to expenses of insurers; to provide for
4 definitions; to prohibit the use of certain expenses in setting rates; to provide for an
5 effective date; and to provide for related matters.
6Be it enacted by the Legislature of Louisiana:
7 Section 1. R.S. 22:1452(C)(introductory paragraph) and (7) and 1454(B)(3) are
8hereby amended and reenacted and R.S. 22:1452(C)(9.1) is hereby enacted to read as
9follows:
10 §1452. Purpose of rate regulation; construction; definitions
11 * * *
12 C. As used in this Subpart, the following definitions shall be applicable
13 apply:
14 * * *
15 (7) "Expenses" means that portion of a rate attributable to acquisition, field
16 supervision, collection expenses, general expenses, taxes, licenses, and fees and does
17 not include loss adjustment expenses or institutional advertising expenses.
18 * * *
19 (9.1) "Institutional advertising expenses" means advertising not aimed at
20 obtaining business for a specific insurer nor providing consumers with information
21 pertinent to the decision as to whether to purchase an insurance product.
22 * * *
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CODING: Words in struck through type are deletions from existing law; words underscored
are additions. HLS 25RS-532 ENGROSSED
HB NO. 438
1 §1454. Rating standards and methods
2 * * *
3 B. In determining whether rates are excessive, inadequate, or unfairly
4 discriminatory, consideration may be given to the following items:
5 * * *
6 (3) Expenses. The expense provisions shall reflect the operating methods of
7 the insurer, the past expense experience of the insurer, and anticipated future
8 expenses. However, an insurer shall not consider its institutional advertising
9 expenses for the purpose of setting rates.
10 * * *
11 Section 2. This Act shall become effective on January 1, 2026.
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)]
HB 438 Engrossed 2025 Regular Session Firment
Abstract: Modifies the definition of "expenses" and prohibits use of "institutional
advertising expenses" in setting insurance rates.
Present law defines "expenses" and specifically excludes loss adjustment expenses.
Proposed law retains present law and further excludes "institutional advertising expenses",
defined as advertising expenses not aimed at obtaining business for a specific insurer nor
providing consumers with information pertinent to the decision of whether to purchase an
insurance product.
Present law authorizes insurers to use certain expense provisions that reflect respective
operating methods, past expenses, and anticipated expenses to determine whether the
insurer's rates are excessive, inadequate, or unfairly discriminatory.
Proposed law retains present law and prohibits insurers from considering its institutional
advertising expenses for the purpose of setting rates.
Effective Jan. 1, 2026.
(Amends R.S. 22:1452(C)(intro. para.) and (7) and 1454(B)(3); Adds R.S. 22:1452(C)(9.1))
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CODING: Words in struck through type are deletions from existing law; words underscored
are additions.