(The Center Square) – A Louisiana judge has ruled Louisiana Department of Insurance Commissioner Jim Donelon Abuced His Power to Force Insurance Companies to Pay Evacation Expenses for Policyholders in 25 Parishes.

Administrative Law Judge Patrick Moore Wrote Last Week That Donelon Went Out of Bounds When He Issued Directive 218 In September 2021 that Demanded Insurers Waive Policy Language That Required a Civil Evacation Order to Trigger Prohibited Use Coverage, or Payments for Living Expenses Associated with an Evacation, Insurance Journal Reports.

The Directive Came Less than a week after a bulletin from the Louisiana department of insurance that encouraged insurers to voluntarily pay claims for prohibited use, even though not all parishes impact by Hurricane Issued a formal mandatory evacuation order.

Allstate requests the directive to comply, and usaa and other insurers Also Stepped up to cover the prohibited use claims, while state farm, the state’s largest homeowers insurer, had refused in the absence of an official evacation declaration.

Many Local Officials were wary of issuing evacuation Orders because of the speed of the storm’s approach and potential to create traffic gridlock that could have put residents in danger. The Directive Applied to Policies in the 25 Parishes listed in Emergency Rule 47, a Measure Aimed at Protecting Policyholders from Cancellations and Non-Renewals in the Wake of the Storm. The Same 25 Parishes were listed in Gov. John Bel Edwards’ Hurricane Ida Emergency Declaration, according to the journal.

The Initial Advisory Followed Donelson’s Tour of St. John The Baptist Parish with President Joe Biden in which policyholders complained about Companies Denying Loss of Use Claims. The Directive Came After Both Donelson and Biden Urrged Insurers to Voluntarily Cover Costs and Not All Complied.

“Hurricane Ida was a clear and present danger to the citizens of Louisiana,” donelon said in the point of directory 218. “Officials throughout the region to the airwaves to get out the message that people need to leave or stay in a safe place. Must Treat the many diverse actions taken by public officials as an order to leave and pay people who have coverage for their expenses. “

Farm Bureau and Dover Bay Specialty Challenged the Directive in Court, and Moore Found Donelon’s Interpretation of the Prohibited Use Policy Was “Wrong, Manifestly Erroneous, and Shocking to the Conscience of the Tribunal.”

Moore Ruled Directive 218 an “Improper Exercise” of Donelon’s Discretion, The Journal Reports.

The Ruling Came The Same Week Donelon Held a press conference to highlight new laws passted during the 2022 legislative session to enhance protects for policyholders and strengthn the state’s insurance market.

Those Reforms Included House Bill 83, Now Act 434, Sponsored by Rep. Laurie Schlegel, R-Jefferson, which Changed How Insurance Companies Additional Living Expenses Due to An Evacation. Intead of the requirements for an official emergency Declaration to Trigger Coverage, the New Law Requires Consideration of the Totality of Circumstances.

Other reforms include an inclination in the minimum capital and surplus requirements for insurers to $ 10 million by 2031, an insurance incentive program to attract more compans to louisiana, a three-adjuster rule with new requirements for insurance compans, Required Catastrophic Response Plan for every Insurance Company, and a New Louisiana Fortify Homes Program to Provide Grant for Homenners to Retrofit Roofing to Higher Standards.