The bill amends Louisiana's insurance law, specifically R.S. 22:1892, to improve claims settlement practices by establishing a "good faith duty" for insurers, which requires them to adjust claims fairly and promptly. It introduces penalties for violations of this duty and defines "catastrophic loss," setting specific timelines for insurers to initiate loss adjustments and make payments after such events. A new section, R.S. 22:1892.2, outlines claims settlement practices for catastrophic losses and includes penalties for non-compliance. The bill also repeals previous provisions governing penalties for claims settlement failures, replacing them with stricter penalties that can reach up to fifty percent of the amount due, plus any proven economic damages.

Additionally, the bill modifies the claims process by stipulating that lawsuits filed before the required notice of the cure period will be stayed for sixty days after the notice is received, and it extends the deadline for insurers to respond to lawsuits until thirty days after the cure period ends. It clarifies that insurers can request further information or inspections during their investigations without extending their payment deadlines. The bill also repeals R.S. 22:1973 entirely and requires the Louisiana State Law Institute to update references in the Code of Evidence and Title 22 of the Louisiana Revised Statutes. Certain insurance policies and entities, such as the Louisiana Insurance Guaranty Association and the Louisiana Citizens Property Insurance Corporation, are exempt from class action provisions related to damages and penalties. The act is set to take effect on July 1, 2024, or upon legislative approval if vetoed by the governor.

Statutes affected:
SB323 Original: 22:1892(A)(3)
SB323 Engrossed: 22:1892(A)(3)
SB323 Reengrossed: 22:1892(A)(3)
SB323 Enrolled: 22:1892(A)(3)
SB323 Act : 22:1892(A)(3)