Commissioner Tim Temple says Liberty Mutual owes about 138,000 Louisiana policyholders approximately $4 million after overcharging the Louisiana Citizens Property Insurance Corporation Emergency Assessment for the past four years.
The issue came to light in February when the Louisiana Department of Insurance (LDI) received a consumer compliant about the Louisiana Citizens assessment charged on their Liberty Mutual renewal notice. The LDI Office of Consumer Services contacted Liberty Mutual and discovered that due to an error, the company had not updated the assessment percentage since 2021.
“I have spoken with Liberty Mutual about the issue, and they told me they corrected the error and will send refunds to all active and inactive policyholders that were impacted,” Commissioner Temple said. “The LDI will monitor the company repayments to ensure policyholders receive all the funds they are due.”
The LDI is continuing to gather information about the error to determine whether additional regulatory action against the company is warranted. This appears to be an isolated incident, and the LDI is working to confirm this issue has not occurred with any other insurers.
The emergency assessment was implemented to pay off bonds for debt Louisiana Citizens incurred from claims for hurricanes Katrina and Rita in 2005. Over the years, the amount assessed has been gradually lowered until the Louisiana Citizens Board of Directors voted in January to end the assessment in April of this year.
Liberty Mutual maintains that all payments remitted to Louisiana Citizens were calculated and reported correctly. The company has adjusted the assessment charge to 0% effective April 1 for all affected policyholders. Former or current Liberty Mutual policyholders who have questions about a refund should contact the company or their agent.
About the Louisiana Department of Insurance: The Louisiana Department of Insurance works to improve competition in the state’s insurance market while assisting individuals and businesses with the information and resources they need to be informed consumers of insurance. As a regulator, the LDI enforces the laws that provide a fair and stable marketplace and makes certain that insurers comply with the laws in place to protect policyholders. You can contact the LDI by downloading our LDIConnect mobile app on the Apple App Store or Google Play Store, calling us at 800-259-5300 or visiting www.ldi.la.gov.