Louisiana — Louisiana has reached its highest grade and ranking in over a decade in the annual Insurance Regulation Report Card, according to the newly released 2024 report from the R Street Institute, a national think tank specializing in free-market solutions and effective government.
The report, which evaluates how each state regulates property and casualty insurance, awarded Louisiana a “C” grade and a ranking of 39th out of 50 states. This marks a considerable improvement from the “D” and “F” grades the state had received every year since 2013, when Louisiana was consistently ranked near the bottom at 48th, 49th, or 50th place.
The R Street Institute’s analysis credits Louisiana’s improved rating to reforms in the state’s regulatory environment and the expansion of the Louisiana Fortify Homes Program. The program aims to strengthen homes against severe weather, particularly hurricanes, by providing grants to homeowners for roofing and structural upgrades. This focus on resilience is intended to reduce future insurance claims and stabilize the market.
Insurance Commissioner Tim Temple acknowledged the progress while emphasizing the need for continued reform. “While a ‘C’ grade is not where we want to be, it does mark the most significant improvement Louisiana has seen in over a decade,” Temple said. “There is still much work to be done in our effort to build a competitive and robust market for all our citizens, and I appreciate this positive national attention we have received for our recent focus on insurance reform.”
The R Street Institute’s Director of Finance, Insurance, and Trade Policy, Jerry Theodorou, who authored the report, highlighted the positive changes. “For many years, and in earlier editions of our report, Louisiana languished with ‘D’ and ‘F’ grades. In our 2024 report, Louisiana advanced to a ‘C.’ Changes contributing to the upgrade include a more efficient process for rate changes, strengthened hurricane defenses and a focus on resilience, exemplified by rollout of the Louisiana Fortify Homes Program,” Theodorou said.
Another key development boosting Louisiana’s grade is the entry of ten new homeowners’ insurers into the state since early 2024, a sign that the insurance market is becoming more competitive and attractive to companies.
The Insurance Regulation Report Card, first published in 2012, evaluates states on several factors: solvency (the financial health of insurance companies), regulation, underwriting freedom (how much flexibility insurers have in setting prices), residual markets (programs for high-risk customers), fiscal efficiency, and competitiveness in auto and homeowners insurance markets.
The R Street Institute, based in Washington, D.C., is known for its work on complex policy issues, advocating for solutions that rely on free markets and limited but effective government.
While the “C” grade is not the end goal, experts say the improvements could lead to better options and potentially lower rates for Louisiana homeowners over time. The Department of Insurance and state leaders plan to continue their focus on reforms to further improve the state’s insurance landscape, making it more stable and affordable for residents.