Released: April 3, 2008
Insurance premium discounts are available in 2008 to home
owners who build or retrofit a structure to comply with the requirements
of the State Uniform Construction Code, install damage mitigation improvements,
or retrofit their property utilizing construction techniques demonstrated
to reduce the amount of loss from a windstorm or hurricane. Act 323 of
the 2007 Regular Session provides these discounts for insureds effective
after insurers file rates to include the discounts with the Louisiana
Department of Insurance between March 31, 2008 and January 1, 2009.
“This is a milestone in our efforts to reduce homeowners insurance
rates in Louisiana and is a great incentive for Homeowners to secure
their homes against severe hurricane, tornado or windstorm damage,” said
Donelon. “The premium discounts apply to both new and existing
homes and are something that everyone who has incorporated one or more
of the incentives will benefit from once their insurance company has
filed for the rate reductions with the Department of Insurance.”
Premium discounts are granted based on damage mitigation improvements
and construction techniques listed on the Louisiana Hurricane Loss Mitigation
Form. Homeowners should contact their insurance company or agent for
more information. These damage mitigation improvements and construction
techniques include but are not limited to: buildings designed to code;
roof bracing; secondary water barriers; opening protection; roof-to-wall
strength; roof deck attachment; roof covering and roof covering performance;
wall-to-floor-to-foundation strength; window, door, and skylight strength;
and other mitigation improvements and/or construction techniques that
the insurer has determined to reduce the risk of loss due to wind.
Inspection and certification must be performed by a building code enforcement
officer, registered architect or engineer, or a registered third-party
provider authorized by the Louisiana State Uniform Construction Code
Council to perform building inspections.
Proof of eligibility for premium discounts must be provided by the
insured. The insurer may require completion of the Louisiana Hurricane
Loss Mitigation Form or other documentation to demonstrate compliance
with the State Uniform Construction Code, such as permits, certificates
of occupancy, inspection reports or receipts. If deemed necessary, the
insurer may also perform its own independent inspection.
Premium discounts apply to one or two-family owner occupied homes and modular
homes. They do not apply to commercial or commercial residential properties
with three or more units, or to manufactured or mobile homes.
Another storm mitigation incentive made available in the 2007 Regular
Session by Act 467 is state income tax deductions for insureds who voluntarily
retrofit an existing residential structure to bring it into compliance
with the State Uniform Construction Code. This construction code retrofitting
deduction is an amount equal to 50 percent of the cost paid or incurred
for the retrofit on or after January 1, 2007, less the value of any other
state, municipal or federally-sponsored financial incentives for the
cost paid. The taxpayer must claim the homestead exemption for the home
being retrofitted and the home cannot be rental property. The tax credit
can be no more than $5,000 per retrofitted residential structure and
is claimed on the tax return for the year in which the work is completed.
A third storm mitigation incentive made available in the 2007 Regular
Session by Act 462 allows insureds to receive exclusions on state sales
and use tax when purchasing storm shutter devices that provide window
damage protection in a storm or hurricane, effective July 1, 2007.
The Louisiana Department of Insurance encourages residential property
owners to take the steps necessary to become a recipient of these financial
benefits for added storm and hurricane protection. Whether you plan to
build a new home or retrofit your existing home, you will benefit from
the insurance premium discounts, tax deductions and tax exclusions now
The Department of Insurance has posted a brochure on homeowner storm
mitigation incentives on its Web site at www.ldi.state.la.us under the
publications tab for insurance agents and Homeowners to access.