Louisiana’s current insurance commissioner and his challenger in next month’s election, both Republicans, gave contrasting descriptions of the state’s insurance markets Monday.
“Today we have more insurers doing business in our state across all lines than ever before,” Commissioner of Insurance Jim Donelon, who has been in the office since 2006, said at a candidate forum hosted by the Baton Rouge Press Club.
Donelon touted lower premiums for workers’ compensation insurance. He said property insurance rates for homeowners have risen only 1 percent per year for the last five years, and said he was proud of the market’s “remarkable recovery” after Hurricane Katrina.
Donelon acknowledged Louisiana’s auto insurance rates are among the highest in the nation, if not the highest, but noted three large companies who serve about half of Louisiana’s drivers recently lowered their rates.
“Louisiana is facing an insurance crisis,” said Tim Temple, a first-time candidate for office and former insurance industry executive. “Louisiana is the most unaffordable state in America for insurance.”
The commercial auto insurance market in particular is not competitive, Temple said. He said business owners face high rates and often can only get one or two quotes for coverage.
Louisiana’s insurance regulatory environment was rated worst in the nation by R Street, a conservative think tank, Temple noted. He argued Donelon’s regulation has been too heavy-handed and said he would support a more “free market” approach.
Temple said the state could attract more insurers by ending the rule that companies can only raise rates once per year. Donelon said most other southeastern states have the same rule, which prevents insurance companies from being able to “sneak rate increases by in half-bites.”
Donelon blamed high auto insurance rates on the state’s legal climate, adding that he supported an unsuccessful bill this session that supporters said might have led to lower rates.
Donelon, a former legislator, was chief deputy insurance commissioner under Robert Wooley. He first became commissioner when Wooley stepped down and has since been elected to the post three times.
Temple is a 20-year veteran of the insurance industry and is head of Temptan, a family holding company. He has put more than $1 million of his own money into the race.
Wooley, a Democrat, is managing Temple’s campaign, a development that has attracted much notice in political circles. In an interview after Monday’s forum, Temple said the two have not discussed any role for Wooley in Temple’s administration, either as an employee or informal advisor, should Temple win the election.
“He knows this race better than any other operative in the state of Louisiana,” Temple said of Wooley, adding the former commissioner would at least be available to help answer questions about the job, if nothing else.
The first round of Louisiana’s state elections will be held Oct. 12. Since only two candidates are running for insurance commissioner, the race will be decided on that day.