Both Louisiana and Arkansas recently enacted emergency regulations aimed at protecting insureds in the aftermath of devastating floods in those states.
Louisiana’s action extends an emergency rule put in place following massive flooding in that state in August 2016. Arkansas’ is a reaction to more recent flood events that occurred there at the end of April 2017.
Louisiana
Louisiana Insurance Commissioner Jim Donelon said the new emergency rule extends the time in which policyholders affected by August 2016 flooding have to comply with insurance policy provisions. It limits an insurance company’s ability to cancel or terminate policies in counties affected by the August 2016 flood.
The emergency regulation will remain in effect across 26 parishes until Aug. 14. It applies to all types of homeowners and residential property insurance, commercial insurance, fire insurance and other types of property insurance.
Insurers will continue to be unable to cancel policies due to the inability of policyholders in a federally-declared disaster area to comply with certain policy provisions. For example, some policies might require habitation or occupancy of dwellings or similar provisions that are not reasonably feasible to comply with following the catastrophic flooding.
Emergency Rule 33 continues the provisions of previously issued Emergency Rules 28, 30 and 32. It applies to insureds living in Acadia, Ascension, Assumption, Avoyelles, Cameron, East Baton Rouge, East Feliciana, Evangeline, Iberia, Iberville, Jefferson Davis, Lafayette, Livingston, Pointe Coupee, St. Charles, St. Helena, St. James, St. John the Baptist, St. Landry, St. Martin, St. Tammany, Tangipahoa, Vermilion, Washington, West Baton Rouge and West Feliciana.
All of those parishes were included in the federal disaster declaration following the August 2016 flood events.
Arkansas
In Arkansas, Insurance Commissioner Allen Kerr enacted a 60-day moratorium on the cancellation/non-renewal of insurance policies for the non-payment of premiums by Arkansans residing in counties declared a disaster by Gov. Asa Hutchinson following April’s severe weather.
The moratorium, effective as of April 26, 2017, applies to all types of insurance policies. However, Kerr noted that “this action does not waive the obligation of Arkansans to pay their insurance premiums” it just extends the time period in which to pay.
The 60-day moratorium affects residents of Baxter, Benton, Boone, Clay, Cleburne, Craighead, Cross, Faulkner, Fulton, Independence, Izard, Lawrence, Jackson, Madison, Marion, Montgomery, Newton, Perry, Prairie, Pulaski, Randolph, Saline, Searcy, Stone, Washington, White, Woodruff, and Yell Counties who must have suffered significant property damage, injuries or related loss of life as a result of the storms.
Kerr emphasized that policyholders must request the extension offered by the moratorium from their insurance carrier.
The Arkansas Insurance Department is encouraging carriers to also reach out to policyholders to provide relief per the terms of the moratorium, including offering assistance to policyholders in paying premiums that become due during the moratorium by either allowing a payment plan or an extension of the due date for full payment.
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