Louisiana Home Insurance

If you own a home in Louisiana, you may wonder what kind of insurance you need to protect your property and belongings. Homeowners insurance is not mandatory by state law, but most mortgage lenders will require you to have it as a condition of your loan. Here are some details of Louisiana homeowners insurance requirements, laws, policies as well as average costs and best companies.

Homeowners insurance covers your home's structure and your personal property from various perils, such as fire, theft, vandalism, hail, windstorm, and lightning. It also covers your personal liability if someone gets injured on your property or if you cause damage to someone else's property. Additionally, it covers your additional living expenses if you have to temporarily move out of your home due to a covered loss.

However, homeowners insurance does not cover flood damage, which is a common risk in Louisiana due to its proximity to the Gulf of Mexico and the Mississippi River. According to the Insurance Information Institute (III), Louisiana had the highest number of flood insurance policies in force in 2019, with over 500,000 policies. Flood insurance is administered by the National Flood Insurance Program (NFIP) and can be purchased through participating insurers or agents. You can also buy excess flood insurance from private companies if you need more coverage than the NFIP limits.

The average cost of homeowners insurance in Louisiana was $1,968 in 2017, according to the III. This was the highest in the nation and 62 percent higher than the national average of $1,211. The average cost of renters insurance in Louisiana was $235 in 2017, which was also the third highest in the nation and 31 percent higher than the national average of $180.

The high cost of property insurance in Louisiana is largely driven by its exposure to hurricanes and other severe weather events. The most devastating hurricane to hit Louisiana was Hurricane Katrina in 2005, which caused over $38 billion in insured losses and 1,800 fatalities. Other major hurricanes that affected Louisiana include Rita (2005), Gustav (2008), Isaac (2012), Harvey (2017), Laura (2020), and Delta (2020).

The best homeowners insurance company for you depends on your specific needs and preferences. However, some factors that you may want to consider when choosing a company include its financial strength, customer service, claims handling, coverage options, discounts, and rates. According to the III, the top five homeowners insurance companies in Louisiana by market share in 2019 were State Farm (25.6 percent), Allstate (10.9 percent), USAA (6.2 percent), Liberty Mutual (5.6 percent), and LA Farm Bureau Mutual Insurance Co. (4.8 percent).

Homeowners insurance is an important part of owning a home in Louisiana. It can help you protect your investment and your financial security in case of a disaster. However, you should also be aware of the limitations and exclusions of your policy and consider buying additional coverage for flood or other risks that are not covered by your standard policy.