The Louisiana House has approved legislation giving the Insurance Commissioner the authority to reject rate increases deemed excessive. This proposal, backed by Governor Jeff Landry, was added to another insurance related bill and it passed on a 67-33 vote. Opponents to the measure say the Insurance Commissioner already has this authority, Slidell Republican Brian Glorioso disagrees.
“They’re not legally allowed to, under our statutory law. So, if they’re already doing it, then I want them to do it under the law and because if it is challenged in court, the first thing the court is going to do is say, ‘you don’t have legal authority to do this, so I’m striking it down,'” Glorioso said.
The 31 Democrats in the House voted for the bill. But about half of the Republican lawmakers in the lower chamber voted against it, including Baton Rouge Representative Paula Davis, who previously worked for the Insurance Department.
“We’re sending a message to the industry that we are an unstable place to do business; we are an arbitrary and capricious place to do business. I just don’t think this is good policy,” Davis said.
Several Republican legislators are skeptical this legislation will lower insurance rates. Mandeville Representative Jay Gallé
says the legislation does not make it clear when the Insurance Commissioner can use their authority to block excessive rate increases.
“Who determines what excessive is? Because, to me, that can be very subjective. How was that determined?” Gallé asked.
Glorioso says a process will be in place to make sure any rate increase rejected would be done in an arbitrary manner.
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