The Louisiana Department of Insurance (LDI) rolled out its new Louisiana Fortify Homes Program (LFHP) last week, making available around 3,000 grants worth up to $10,000 each for installation of windstorm-resistant roof upgrades able to better withstand hurricane-force winds.
Once new roofing systems are properly installed, homeowners are issued certificates good for five years, allowing them to qualify for premium discounts on their homeowners insurance policies – discounts insurers are now mandated via a new state law to give for those participating in the program.
The first application rollout of the program opened on October 2 last week, aimed at serving primarily Louisiana Citizens policyholders. The LDI reported in a recent press release its first round of 500 grants were awarded in just over two minutes on October 2. A second LFHP allotment of around 1,000 grants is expected to open up for more Louisiana Citizens policyholders on October 16 at Noon. The LDI’s website recently stated the remaining 1,500 grants will be opened up to all homeowners sometime later this year.
Given the new program was only released last week by the state, the LDI has been holding trade seminars to better inform insurance agents on its merits, one of which Dave Millet Jr., principal of multi-location independent agency Dave Millet Insurance, recently attended ahead of the first rollout.
“[A representative from the LDI’s office at the recent seminar] said it could reduce your premiums 25 percent if you get it done – minimum – and maybe more,” Millet Jr. commented regarding the LFHP.
The promise of deep insurance premium discounts has driven intense interest from Louisiana homeowners as well as roofing contractors, who are hoping to secure a new treasure trove of high-end roofing jobs subsidized with state funding.
Trade publication Roofing Contractor recently reported re-roofs installed by a certified contractor using the new program’s standards are expected to cost anywhere from $13,000 to $18,000 for the average homeowner, making it a pricey upgrade for most. Even for the fortunate few who may land a $10,000 grant from the state, out of pocket costs are likely.
“Everyone would like to [participate in the LHBP program] with a grant,” Millet Jr. stated. “But if you can’t get a grant, it’s kind of [expensive].”
The LFHP grant program was put together by state legislators via Act 554, passed during the 2022 Regular Session. Similar programs already exist in 13 other Gulf and eastern seaboard coastal states like Georgia, Florida, North Carolina and Texas.
The program’s roofing standards, known as FORTIFIED™, were created by national trade group Insurance Institute for Business and Home Safety (IIBHS) after identifying common construction weaknesses following hurricanes and windstorms, then testing solutions in its research center.
Given the limited number of state-funded grants currently available, the new program so far does not appear to be the financial tonic most Louisiana homeowners have been looking for to cure painfully high homeowner premiums.
As a seasoned insurance veteran having seen multiple insurance market cycles over the course of his career, Millet Jr. said overall premium relief will eventually come, but it will take more time.
New so-called “take-out” companies attracted by the state to depopulate Louisiana Citizens have meanwhile begun picking up large allotments of Louisiana Citizens policies, Millet Jr. said. He has observed some of his own clients’ policies placed with Louisiana Citizens being picked up by new companies entering the state, but pricing relief from high rates for most have not yet been realized given the change only recently began to happen.
“It’s not a drive-thru – it takes time to get your order filled,” Miller Jr. said of the slow progress the insurance market is likely to make over the next few years before delivering lower premiums once again to Louisiana homeowners.
Visit the LDI’s website at www.ldi.la.gof/fortifyhomes to learn more about the FORTIFY program, get on the LDI’s application notification list for future enrollment periods or determine eligibility.
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