The Louisiana Department of Insurance (LDI) has announced that Liberty Mutual Insurance will issue refunds totaling roughly $4 million to approximately 138,000 Louisiana policyholders. The refunds are a result of the company overcharging for the Louisiana Citizens Property Insurance Corporation Emergency Assessment over the past four years, according to Insurance Commissioner Tim Temple.
Temple stated that the LDI initiated an investigation after receiving a consumer complaint in February regarding the Louisiana Citizens assessment on a Liberty Mutual renewal notice. The investigation revealed that a clerical error had prevented the company from updating the assessment percentage since 2021.
“Last month we learned of an unintended clerical error in how we applied the Louisiana Citizens assessment percentage to residential property insurance policies from 2021-2025,” a Liberty Mutual spokesperson said. “We regret the error, and we are working closely with the Louisiana Department of Insurance on a plan to refund impacted customers as quickly as possible.”
Temple indicated that the LDI would be closely monitoring Liberty Mutual’s repayment process to ensure policyholders receive the full amount due.
“I have spoken with Liberty Mutual about the issue, and they told me they corrected the error and will send refunds to all active and inactive policyholders that were impacted,” Temple said.
The emergency assessment was originally implemented by the LDI to help insurers pay off bonds for debt incurred by Louisiana Citizens due to claims from Hurricanes Katrina and Rita in 2005. The assessment, which applies to both residential and commercial property policies, has gradually decreased over the years. Earlier this year, the Louisiana Citizens Board of Directors voted to eliminate the assessment in April.
Liberty Mutual has already adjusted the assessment charge to 0% effective April 1 for all affected policyholders. Former or current Liberty Mutual policyholders with questions about a refund should contact either the company or their insurance agent, the LDI advised.
