Louisiana Homeowners to Receive Refunds from Liberty Mutual Amidst Insurance Crisis

Thousands of Louisiana homeowners with Liberty Mutual policies will soon receive refunds after the company was found to have overcharged policyholders for the past four years. State Insurance Commissioner Tim Temple announced that approximately 138,000 policyholders were affected, with overcharges totaling around $4 million.

The issue came to light in February when the Louisiana Department of Insurance (LDI) received a consumer complaint regarding the Louisiana Citizens Property Insurance Emergency Assessment on a Liberty Mutual renewal notice. An investigation revealed that the company had failed to update the assessment percentage since 2021 due to an error.

“I have spoken with Liberty Mutual about the issue, and they assured me they have corrected the error and will be issuing refunds to all impacted active and inactive policyholders,” Temple stated. The LDI will oversee the repayment process to ensure customers receive the refunds they are owed.

The emergency assessment was originally put in place to help pay off debt from claims following Hurricanes Katrina and Rita in 2005. Temple clarified that this issue was isolated to Liberty Mutual.

Meanwhile, Temple faced tough questions from residents at a town hall in St. Tammany Parish, where homeowners expressed frustration over soaring insurance premiums. Speaking at Fontainebleau High School, Temple acknowledged that Louisiana residents, on average, spend about 7% of their gross income on property and auto insurance.

Homeowner Chriss Cazayoux shared his struggle, revealing that his insurance costs—excluding flood coverage—had surged to nearly $20,000 annually, forcing his family to consider relocating. “I will save $1,500 or more per month by moving to Western Virginia or the Philadelphia area,” he said.

Temple emphasized the need to create a competitive insurance market where companies can operate and compete fairly, helping to prevent extreme rate hikes. He also stressed the importance of accountability, stating that legislative efforts and initiatives like the fortified roof program could help stabilize rates.

“It works. When your shingles stay on your home and your contents stay dry, you can get back into your home sooner,” Temple explained.

Many residents remain concerned that Louisiana’s vulnerability to hurricanes will continue driving rates higher. However, some, like Arlene Rome, left the meeting with cautious optimism. “I’m walking out of this meeting having hope that he will figure out something to resolve it,” she said.

As Louisiana continues grappling with an insurance crisis, policyholders await relief not only in the form of refunds but also long-term solutions to rising premiums.