IIABL STAFF

JEFF ALBRIGHT

Chief Executive Officer jalbright@iiabl.com (225) 236-1366

BENJAMIN ALBRIGHT

Vice-President of Strategic Initiatives balbright@iiabl.com (225) 236-1357

KATHLEEN O'REGAN

Director of Communications & Events koregan@iiabl.com (225) 236-1360

KAREN KUYLEN

Director of Accounting & Finance kkuylen@iiabl.com (225) 236-1353

RHONDA MARTINEZ

Director of Insurance Programs rmartinez@iiabl.com (225) 236-1352

JAMIE NEWCHURCH

Director of Insurance Programs jnewchurch@iiabl.com (225) 236-1350

LISA YOUNG-CROOKS

Director of Member Relations lyoung@iiabl.com (225) 236-1351

CONTENTS

05

INSURANCE REFORMS MOVING IN LOUISIANA LEGISLATURE

10LIGHTHOUSE IN RECEIVERSHIP 12LA CITIZENS BINDING PROCEDURES

18153 E. Petroleum Drive Baton Rouge, LA 70809 Ph: (225) 819-8007

www.iiabl.com TABLE OF CONTENTS & FEATURED STORIES 02 IIABL STAFF

At your service!

15 UM SELECTION FORMS

Tips from an expert: Dos & don'ts when completing these

forms 18 WHAT'S YOUR AGENCY TECH STACK?

Complete this Catalyit Survey and win great prizes! 19 HOW TO USE 'HELP A REPORTER OUT'

Cataylit Corner with Steve Anderson HARO 21 AVOID THESE SALES MISTAKES

10 tips! 24 BUILDING AN EFFECTIVE LOCAL

MARKETING STRATEGY

Ideas for your agency from ePayPolicy 29 THREE PARTS TO PLANNING

FOR YOUR FUTURE

By Carey Wallace, Agency Focus 31 YOUR PATH TO

DIRECT APPOINTMENT

IIABL Member Benefit: Independent Market Solutions

32 VACANT LAND

By Tim Wahl, Gallaher Insurance Group Chair MAIA Coverage Advisory Committee

35 THE 'BUSINESS USE' EXCLUSION IN

PERSONAL AUTO POLICY

By Chris Boggs 40 THE CGL POLICY

& Faulty Workmanship 43 UNDERSTANDING LIQUOR LIABILITY

By: Chris Boggs 47 CHAPTER EVENTS & NEWS 48 IIABL EDUCATION UPDATE 50 ADVERTISER INDEX 51 INDUSTRY PARTNERS 52 IIABL BOARD OF DIRECTORS

Insurance Reforms Moving in Louisiana Legislature

By: Jeff Albright & Ben Albright

The 2022 Regular Session of the Louisiana Legislature is at the half-way point and is scheduled to end on June 6, 2022. This session is a historically bad session for the insurance industry with many bills filed to tighten regulations and, in some instances, punish insurance companies as a result of complaints about claims settlement practices after the four hurricanes of 2020-2021.

Thus far, most of the truly punitive bills have not been heard. Legislative leadership has been working to pass meaningful but reasonable insurance reforms in an effort to discourage passage of more punitive measures. The bad news is that there are plenty of breathtakingly bad bills that can still be heard and possibly passed into law. The good news is that really good legislation is moving through the process and provides hope that improvements can be made without destroying our already tight property insurance markets. Here are some of the more important reasonable insurance reforms. HB 83 by Schlegel and SB 134 by Talbot –Addresses loss of use/evacuation coverages. These bills relate to the controversy around Commissioner Donelon’s Directive 219 which requires insurers to pay evacuation expenses under their “ civil authority loss of use” coverage for Hurricane Ida. The bill would create a statutory trigger for such coverage. Many insurers believe that their civil authority coverage is NOT intended to cover such expenses.

HB 83 passed the House and moves to

Senate Insurance.

SB 134 passed the Senate and moves to

House Insurance.

IIABL has some concerns with statutorily mandating coverage that is not in the policy but is neutral on these bills.

HB 831 by Firment – In the event of a total dwelling loss, requires insurers to advance payment of at least three months estimated additional living expenses to residential property policyholders with ALE coverage without receipts or proof of loss. Additional payments would have to be documented.

HB 831 passed the House committee and moves to the House floor.

IIABL supports HB 831. HB 521 by Huval – Expands the requirements for insurers to create and maintain a disaster response plan to respond to hurricanes. Adds requirements for insurers to file a plan for staffing sufficient adjusters and other personnel to respond to catastrophe claims in order to ensure that insurer operations and communications function after a catastrophe.

Passed the House committee and the

House floor in 2 unanimous votes. Now heads to Senate Insurance.

IIABL is sponsoring this bill. HB 612 by Huval – Establishes the Louisiana Fortify Homes Program within LDI to provide grants to homeowners who retrofit their homes to fortified homes standards. Funds would come from revenues already generated by LDI.

Passed House Insurance and is scheduled to be heard by House Appropriations

Committee soon. HB 936 by Huval – Provisions taken from Texas statutes which provides tighter time frames for insurance company response on catastrophe claims settlements, designed to shorten the time needed to settle claims.

Passed House Insurance and will be on the

House floor soon.

IIABL supports this bill.

HB 999 by Firment – Adds additional regulations for business practices of public adjusters in order to ensure proper conduct and protect policyholders.

Passed House Insurance and will he on the

House floor soon.

IIABL supports this bill. SB 117 by Luneau, SB 122 by Talbot, and HB 870 by Lacombe – These bills are intended to address the “Landry vs. Progressive” Louisiana Supreme Court case in which they ruled that insurers can include policy language to exclude coverage on a named insured while they drive someone else’s vehicle with permission.

SB 117 passed the Senate committee and

Senate floor in 2 unanimous votes. Now heads to House Insurance.

HB 870 has passed the House. Now heads to Senate Insurance.

IIABL supports these bills (they may need a couple of amendments). SB 163 by Talbot – Requires insurers to provide policyholders with a catastrophe claims process disclosure when they submit a claim. The commissioner would create a standardized form which explains things that policyholders might need to know during the claims process. Insurers would then be required to provide that form to the policyholder no later than the first adjustment. IIABL thinks this could be a significant help in policyholder education and setting expectations for the claims process.

Passed the Senate committee and Senate floor in 2 unanimous votes. Now heads to

House Insurance.

IIABL is sponsoring this bill. SB 198 by Talbot – Requires increased communications if a claim requires more than 3 adjusters. In an effort to combat “ adjuster churn” and related fatigue for policyholders, this LDI sponsored bill, would require companies send a report on the status of the claim after the third adjuster. They would also be required to assign a permanent contact at the company for the policyholder. That way, even if another adjuster must be assigned, the policyholder has a single point of contact that can manage the claim and ensure that it is moving forward. Passed the Senate committee and Senate floor in 2 unanimous votes. Now heads to

House Insurance.

IIABL supports this bill. SB 209 by Stine – Increases the commissioner’s authority to fine insurers who engage in unfair trade practices. The current maximum aggregate penalty of $250,000 would be doubled in the event that a market conduct review unearths sufficient evidence of poor behavior on the part of an insurer.

Passed the Senate committee and Senate floor in 2 unanimous votes. Now heads to

House Insurance.

IIABL supports this bill. SB 212 by Stine – Formalizes in statute the hurricane mediation program that Commissioner Donelon has instituted in the wake of recent storms. Allows policyholders and insurers another option to adjudicate claim disputes outside of costly litigation.

Passed the Senate committee and is scheduled to be heard on the Senate floor soon.

IIABL supports this bill. SB 264 by Bouie and HB 866 by Frieman –Increases minimum capital and surplus requirements for insurers from $3 million to $10 million. The goal is to encourage conservative underwriting and reinsurance practices from carriers by requiring investors to “ put more skin in the game. ” Hopefully, this will help discourage future insolvencies like we have seen the last two years.

SB 264 passed the Senate committee and

Senate floor in 2 unanimous votes. Now heads to House Insurance

HB 866 passed the House and passed the

Senate committee; it will be scheduled for

Senate floor debate soon.

IIABL supports this bill. SB 412 by Talbot – Modifies the Insure Louisiana Incentive Program. This resurrects an incentive program to bring new carriers into the Louisiana property market. After Katrina, the program experienced some success in attracting new market entrants, increasing competition, and lowering rates. SB 412 updates the program to address the current market shortages.

Passed the Senate committee and Senate floor in 2 unanimous votes. Now heads to

House Insurance.

IIABL supports this bill. SB 446 by Fred Mills – Establishes stricter requirements on mortgage lenders on how they handle insurance claim checks in order to expedite the release of funds to the homeowner to allow them to make repairs on their damaged property faster.

Passed the Senate Commerce Committee and will be heard on the Senate floor soon.

IIABL supports this bill. Passed the Senate committee and Senate floor in 2 unanimous votes. Now heads to

House Insurance.

IIABL supports this bill. SB 209 by Stine – Increases the commissioner’s authority to fine insurers who engage in unfair trade practices. The current maximum aggregate penalty of $250,000 would be doubled in the event that a market conduct review unearths sufficient evidence of poor behavior on the part of an insurer.

Passed the Senate committee and Senate floor in 2 unanimous votes. Now heads to

House Insurance.

IIABL supports this bill. SB 212 by Stine – Formalizes in statute the hurricane mediation program that Commissioner Donelon has instituted in the wake of recent storms. Allows policyholders and insurers another option to adjudicate claim disputes outside of costly litigation.

LIGHTHOUSE IN RECEIVERSHIP

By Jeff Albright IIABL CEO

The Louisiana Department of Insurance (LDI) filed, and the court approved, placing LPIC Property Insurance Corporation and Lighthouse Excalibur Insurance Company (LEIC) into receivership in early April.

On Tuesday, April 26, 2022, LDI filed a Petition for Liquidation of Lighthouse Property Insurance Corporation (LPIC). The court is expected to sign the order before the end of April.

The signing of the Liquidation Order with a finding of insolvency is the triggering event that will result in a 30-day notice of cancellation and activate the guaranty associations for policies in South Carolina, North Carolina, Texas, and Florida. At that point insureds and agents in those states should call the guaranty association in the state they reside for all claims and return premium matters.

LDI requested a carve out for the Louisiana policies in LPIC so that they can work with the Receiver to try to find financially sound insurers who are willing to assume the Louisiana LPIC policies, as they did with the receiverships of Access Home, State National Fire, and Americas Insurance. Thus far, no insurer has expressed interest in assuming all of the 30,000 LPIC policies, so the Receiver has created six geographically diverse bundles of 5,000 policies which are available for assumption.

If Louisiana LPIC policies are not assumed by other insurers, at some point those policies will also be liquidated, and all Louisiana LPIC policyholders will receive a 30-day notice of cancellation. Louisiana agents will then have to replace coverage during the 30-day notice period.

LPIC is admitted in Louisiana, meaning that policyholders are covered by the Louisiana Insurance Guaranty Association (LIGA) for claims up to $500,000 and for up to $10,000 in return premium.

LIGA is now responsible for paying LPIC claims and return premiums. New claims should be filed directly with LIGA instead of LPIC. Claims previously reported to LPIC have been assumed by LIGA. All claims inquiries should be directed to LIGA by calling (225) 277-7171.

Agents and policyholders will receive further information from the court-appointed Receiver who is now in charge of operating the insolvent insurer.

Lighthouse had approximately 30,000 policies as of the start of the year which represents just over 3% of the Louisiana homeowners market.

IIABL will provide additional information as it becomes available.

The LDI/Receiver anticipates filing a Petition for Liquidation for Lighthouse Excalibur Insurance Company (LEIC) in early May.

By: Jeff Albright IIABL CEO

Unfortunately, the extremely difficult Louisiana property insurance market is forcing IIABL member agents to use Louisiana Citizens Property Insurance Corporation (LA Citizens) more than ever before.

IIABL has received numerous inquiries from members with questions and concerns about LA Citizens procedures for binding commercial property insurance coverage.

LA Citizens is continuing to follow their standard binding procedures. Producers can bind policies with the total insured value (TIV) below $1,000,000 the following business day from when it is entered.

If the risk has a TIV over $1,000,000, the risk must be reviewed by a LA Citizens underwriter prior to binding. LA Citizens is currently reviewing submissions within 1 business day of submission. Their goal is to review all submissions within 3 business days. Once the LA Citizens underwriter approves the quote, they will assist the producer in getting the policy issued with the original quote effective date. Producers will have a problem if they try to revise a quote after the effective date has passed since they can only bind the next day.

There a few things producers can do to speed the process.

Please review the general rules to understand the submission process. Include all buildings on the quote when it is first submitted. Each time you revise the quote the system changes the referral date and time to when the submission is last exited.

C o n t i n u e d f r o m p a g e 1 2

Include the e2Value building valuations with the correct description, correct construction, and correct square footage. Submissions can be processed faster if the LA Citizens underwriter can review the quote in its entirety at one time in lieu of having to request additional information. If a risk is over water or partially over water, you must provide a copy of the flood policy. If there are multiple buildings at one location, please submit a diagram showing the locations of the buildings.

For detailed information, please refer to the LA

Citizens Commercial Property Rules.