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A fourth insurance company that served Louisiana consumers has exhausted its reinsurance coverage and run out of money, according to the state Department of Insurance.
Insurance Commissioner Jim Donelon placed Lighthouse Property Insurance Corporation into receivership last week in the 19th Judicial Court, a news release said. This allows the Louisiana Insurance Guaranty Association to take over claim payments.
Lighthouse Property had around 30,000 policies and 16,000 Hurricane Ida-related claims, the news release said. As of the end of 2021, the company covered 3.27% of the Louisiana homeowners insurance market. A court-appointed receiver is now in charge of operating the company.
Other insurers that have placed into receivership following Hurricane Ida include Americas Insurance Company, Access Home Insurance Co. and State National Fire Insurance Co.
SafePoint Insurance Co. assumed the policies of Access Home Insurance Co. and State National Fire Insurance Co. Americas Insurance remains in rehabilitation, a form of receivership aimed at solving its financial issues.
LDI cited hurricanes Laura, Delta and Zeta in 2020, which cost insurers $10.6 billion; Ida, which is projected to cost between $10 billion and $15 billion; and increasing labor and materials prices caused by the hurricanes as well as high inflation.
“Losing a fourth insurer to the unprecedented 2020 and 2021 hurricane seasons is unfortunate, but I’m proud of how effectively we have managed the insolvencies so far,” Donelon said in a statement. “For the first three failed insurers, we were able to quickly find an insurer to take over their policies on the same terms and conditions policyholders had under the failed companies, and I’m hopeful we will do the same for Lighthouse policyholders. Meanwhile, LIGA has shown it is capable and ready to handle paying up to $500,000 of the failed insurers’ remaining claims.”
