To Give Policyholders More Time to File Lawsuits. Louisiana Insurance Commissioner Jim Donelon has ordered insurers in the state to give policyholders more time to file lawsuits over unresolved hurricane claims after most insurers failed to respond to his request that they voluntarily extend the deadline.
The commissioner last month requested that admitted and surplus lines insurers give policyholders two years in which to file lawsuits related to unresolved claims from hurricanes Katrina and Rita. Most homeowner policies in the state limit the policyholder’s right to file a claim to a period of 12 months after the loss. The longer period was proposed so both sides could have more time to work on an unprecedented number of claims from the storms.
In his directive issued Tuesday, the commissioner established the new prescriptive period for Katrina claims as Aug. 30, 2007, and the period for claims related to Rita as ending Sept. 25, 2007.
Insurers Who Fail to Comply With the Directive.
Insurers who fail to comply with the directive will be subject to “any and all enforcement authority” held by the commissioner, the directive said. A spokeswoman for the Louisiana Department of Insurance said that means insurers could face fines or license revocations if they ignore the directive.
The one-year prescriptive period is established by Louisiana law, but the commissioner maintains that he has the authority to change that deadline and that change does not run afoul of the state law.
The commissioner said in a statement that it appears Louisiana is the only state with a one-year statute of limitations on property damage lawsuits. Other states have prescriptive periods that are two years or longer, he said.