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State grants for roof upgrades will go to Citizens policyholders first, commissioner says

Construction on a home in Alabama paid for by a state-funded program. Strengthen Alabama Homes serves as the model for Louisiana's new initiative.
Carly Berlin
Construction on a home in Alabama paid for by a state-funded program. Strengthen Alabama Homes serves as the model for Louisiana's new initiative.

The Louisiana Fortify Homes Program — a $30 million state-funded program that pays homeowners to strengthen or replace their roofs to better protect against hurricanes — is expected to start distributing money to homeowners this October.

But Louisiana’s insurance commissioner, Jim Donelon, told WRKF and WWNO that his office will limit eligibility in the first round of funding to people who are insured by Louisiana Citizens Property Insurance Corporation.

“Only Citizens policyholders will be eligible for that first $15 million,” Donelon said. “Two weeks or three weeks later, we’ll do another offering of the remaining $15 million, and whatever is not used from the first round by Citizens policyholders.”

Citizens is Louisiana’s insurer of last resort, meant to supplement coverage gaps left by the shrinking number of private providers who operate in the state. State law requires Louisiana Citizens prices to be at least 10% above the highest market insurance rate in each parish.

A spokesperson with Donelon’s office said the state is prioritizing Citizens policyholders in the program’s first round of funding in part to offer them some relief from the higher rates they pay. But the ultimate goal, the spokesperson said, is to encourage more insurers to do business in the state – which would move more residents off of the state’s insurer of last resort, and lower costs for the state in the wake of severe weather.

Most single-family homes in Louisiana are eligible for the grant, excluding condominiums and mobile homes.

The LFHP was designed after a program in Alabama called Strengthen Alabama Homes. Both states’ programs grant up to $10,000 to homeowners for upgrading their roofs to the construction standards set by the Insurance Institute for Business and Home Safety, a research group funded by the insurance industry.

The Insurance Institute’s most basic standard involves reinforcing the one part of a house that its researchers found results in the largest number of insurance claims, and the greatest amount of damage: the roof.

Under those standards, roofers use special nails, called ring shank nails, that help keep the roof deck attached to the house. They also include the addition of an ice and water shield — a protective layer that helps keep water out of the house.

After record-breaking hurricane seasons in 2020 and 2021, Louisiana’s property insurance crisis has grown increasingly urgent. Eleven insurers have become insolvent in the state since 2020. Others have stopped writing policies below I-10 and along the coastline, where most of Louisiana’s large population centers are located.

As insurers have pulled out of the state, rates have skyrocketed and more people have been forced to rely on Louisiana Citizens. More than 100,000 homeowners have policies through the state's insurer of last resort, up from about 35,000 before Hurricane Laura in 2020.

Donelon said he believes the Louisiana Fortify Homes Program will help reverse the state’s insurance crisis. Many people got new roofs after hurricanes Laura, Delta and Zeta in 2020 and Ida in 2021, he said. That alone, he said, makes Louisiana a more attractive place for insurers to do business.

“We’re the best coastal state to do business in — property insurance business — because of those new roofs all across or below I-10 and I-12 parishes,” he said.

Donelon said he expects the money from the LFHP to be used to upgrade another 3,000 homes in Louisiana. He said the program will distribute money through a first-come, first-served lottery. Donelon’s office has not announced a specific date that LFHP applications will open or when funds will be available — though he said he anticipates putting the funds up for distribution the first days of October.

Donelon, a Republican who has served as Louisiana’s insurance commissioner since 2006, announced in March that he would not seek reelection. Republican Tim Temple, a former insurance executive, is expected to succeed Donelon after the race’s only other candidate, Democrat Rich Weaver, dropped out last week.

Molly Ryan is a political reporter and covers state politics from the Louisiana Capitol.