Louisiana homeowners hopeful insurance bill passes May 29, 2010

Louisiana homeowners how are facing dire economic times, in light of the Chinese drywall crisis (following the heels of Hurricane Katrina, and in the wake of the ongoing oil disaster, mind you) and many hope for relief in the insurance arena, from the Louisiana House of Representatives.

A bill that would prevent insurance companies from failing to renew or canceling clients who file Chinese drywall-related claims has progressed to the full House.

As reported by ifawebnews, (read source article here), The Louisiana Senate approved the original bill last month.  (SB 595).  The House Insurance Committee then rewrote it.  Thus, the bill will go back to the Senate if the above-mentioned House of Representatives approves it.  While complicated as it may seem, the process is underway and the bill is looking good.

The article cites the New Orleans Times-Picayune as reporting that some insurers have tried to amend the bill.  One such amendment sought to strike a portion of the bill that would require reinstatement of dropped policyholders within 30 days at the same level of service, or “condition,” as existed before the client faced termination.

At the present time, the bill would prevent insurers from canceling or failing to renew with regard to one factor: the presence of drywall from China, installed before December 31, 2009.  Insurance companies should not fret or panic, as the bill would not cause them financial ruin.  The current bill’s terms would expire in mid-2013; thus the bill is seemingly designed to remedy the problems homeowners are currently facing, as opposed to focusing its aim on Chinese drywall broadly (as in, Chinese drywall installed at any date).