Rates climbing for Louisiana's insurer of last resort

Homeowners insurance rates from Louisiana's insurer of last resort increased by 63% on average, and National Flood Insurance Program premiums will increase by 234% on average this year, according to a new report.

Why it matters: The cost of Louisiana homeownership is increasing substantially as both homeowners and flood insurance rates climb, according to the First Street Foundation's 9th National Risk Assessment report.

Yes, but: Thousands of Louisiana homeowners could switch from Citizens, the state's insurer of last resort, according to a report from NOLA.com | The Times-Picayune.

• The change could save homeowners on their premiums because the agency is required to price its policies at 10% above the market rate.

Context: The foundation report says New Orleans is home to the second-most expensive average homeowners insurance coverage at $3,983, behind only Miami at $5,003.

• The median home values are quite different, however. Citing American Community Survey data, the report states the median home value in Miami is $411,300 and $279,100 in New Orleans.
• The increased flood insurance premium has led 52,000 Louisiana homeowners to drop coverage, the report says.
• Nearly one in five Louisiana homeowners tried to change homeowners policies last year, and more than half had difficulty doing so, according to an LSU survey.

What we're watching: Louisiana is one of 10 states that have sued FEMA to redraw its Risk Rating 2.0 maps, which prompted the flood insurance rate increase.

• Testimony in the case began last week, WWL reports.