Property insurance rates getting more and more competitive

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Homeowners Insurance RatesHomeowners may actually start getting a break on their insurance policies; at least in Louisiana. A few new insurance companies have started business there; where just a few years ago they were closing shop and leaving. The homeowner’s didn’t have a lot of choice as far as insuring their homes; if they could get coverage at all. Now it looks like change is on the way.  

A survey done in 2008 showed Louisiana had the third highest insurance rates in the nation; leaving homeowner’s paying an average of $1400 for a basic policy. The insurance industry had all ready been struggling since hurricane Andrew pay outs in 1992; but, when Katrina hit in 2005 that was the breaking point for several companies.

Louisiana is unique because they have a law that protects homeowners from being dropped by their insurance carrier. If they have had their policy with a specific company for at least three years, they can’t be canceled just because of a (hurricane damage) claim.

The only way out for many of the companies was to close their entire business there, which left some homeowners scrambling to find coverage. Some have had to pay up to 500 percent more for the same policy they used to have; mostly, because of a lack in competition.

In the last three and a half years there have been ten new insurance companies starting business, and homeowners are now starting to see more competitive rates. The state-run company “Citizens” has lost over 26 thousand customers since the new companies have come in.

As people become aware of these new companies they are shopping around more for a better deal. The money they save per year on their policies is an acceptable trade off for the “three year no cancel” protection they had with their old company. It isn’t just a hundred dollars or so; some are saving thousands of dollars.

This is a huge deal for the people of Louisiana. It’s another sign that the state is still making efforts to recover and progress from the devastation it suffered just over five years ago.

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