Expert Provides Advice on Rising Insurance Costs

NEW ORLEANS – With June marking National Safety Month and National Insurance Awareness Day approaching on June 28, it’s the perfect time to revisit best practices in insurance coverage and risk management. Rachael Brennan, a licensed insurance expert and veteran car insurance reporter for U.S. News & World Report, draws on more than two decades

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Extreme Weather

“The biggest trend I've seen recently is insurance companies leaving states that are prone to natural disasters. Louisiana has seen a dozen or more insurance companies leave the state or become insolvent since 2020, but it isn't just Louisiana having this problem,” said Brennan. “Florida, California, Texas, and several other states are all having the same issue, largely due to extreme weather patterns, like hurricanes, wildfires, tornadoes, etc.”

The higher frequency of storms and extreme weather are impacting car insurance prices, according to Brennan, especially in storm-prone states like Louisiana.

“The more storms, hurricanes, and other weather-related events that happen in a given area, the more claims will be filed with your insurance company. Not only do insurance companies need to raise rates to cover the cost of paying out those claims, but they also use current claims to help determine how much they are likely to pay out in the future,” said Brennan.

“Having more storms this year (and more claims caused by those storms) means insurance companies will likely raise rates in anticipation of an increased number of extreme weather events next year. And, considering there were 27 weather-related natural disasters that caused more than $1 billion dollars in property damage and at least 568 fatalities in 2024, states that were heavily impacted by those natural disasters should expect to pay higher rates for their car insurance in the future,” said Brennan.

Fortified Roofing

The Fortify Homes grant program, offering up to $10,000 toward roofing upgrades, has supported over 1,800 projects since late 2023. In addition, the Louisiana Legislative Auditor, Mike Waguespack, reviewed the Fortify Homes Program and found the grants reduced insurance premiums by a median of 22%. According to the March report, homeowners who received the grants saved $1,250 annually, cutting their premiums from $5,625 to $4,375.

Homeowners typically pay an additional 10–20% for fortified construction, but independent inspections and stronger materials allow insurers to offer discounts of 20–30%, and every insurer in the state must have a filed discount schedule for fortified roofs.

But Brennan warns that the program’s impact will depend in the long run on the amount of damage that is prevented by it.

“Fortified roofing incentives could play a part in helping keep home insurance costs as low as possible, but there is no guarantee they will reduce home insurance costs,” said Brennan. “The impact the incentives will have on home insurance prices depends on how many people take advantage of the incentives and the amount of damage that is prevented by fortified roofing.”

Car Insurance

According to Brennan, the best way to address car insurance costs is to shop around. “The best way to make sure you're paying the lowest possible rate on your car insurance is to compare quotes from multiple insurance companies at every renewal, but it is important to make sure you are looking at comparable policies,” said Brennan. “A car insurance policy that has lower rates because it offers less coverage is not necessarily a bargain, especially if you need to file a claim in the future, so make sure you are getting the same coverage from both policies before switching to a new insurer.”

As the cost of insurance continues to rise, more drivers are choosing to go without insurance because they simply can't afford it. “In 2022, about 14% of drivers in the United States were uninsured,” said Brennan. “With 13.7% of drivers in Louisiana going without insurance, approximately 1 out of every 7 drivers in the state is uninsured.”

The risks involved in driving without auto insurance are severe. “Car insurance is required by law in almost every state to protect people financially. If you're driving uninsured and are at fault in an accident, you are legally responsible for any damage you cause, including bodily injuries and property damage,” said Brennan. “Depending on the severity of the accident, you could have your future wages garnished or your assets liquidated by the courts to pay off any damage you caused to someone else. And, if you are hit by an uninsured driver, you may have to fight in court, sometimes for years, to have your expenses paid.”

The easiest way to protect yourself is to purchase uninsured motorist coverage, sometimes referred to as UM coverage. “If you have UM coverage and are hit by an uninsured driver, your insurance company will pay your medical expenses up to the limits of your policy. You may also want to purchase collision coverage, which pays for damage to your vehicle that is caused by a collision, no matter who is at fault,” said Brennan.

Life Insurance

Brennan provides an interesting nugget of wisdom about how much life insurance is required for families.

“Life insurance is an excellent way to provide your family with a financial safety net if you pass away unexpectedly, but you probably need less life insurance than you think. If your biggest concern is helping your loved ones pay for large expenses, like paying off your mortgage or putting your children through college, term life insurance is probably all you need, while whole life insurance may be a better choice for individuals who have a high net worth or have additional responsibilities, like caring for an aging parent or an adult child with disabilities,” said Brennan.