HOUMA, la. – The scars from last year’s Hurricane Ida are fresh – a strip mall grocery store is abandoned, its glass front knocked off; Signposts and gas stations are torn down; Dull blue tarps cover the buildings.
“The downtown area has really taken a beating,” says Jonathan Foret, executive director of the South Louisiana Wetlands Discovery Center in Houma, 30,000 southwest of New Orleans. He points out the historic storefronts and the lost rooftop climbs.
Foret is taking a long-term damage survey on the drive to see his insurance agent. He is among thousands of Louisiana homeowners looking to find new property insurance amid the new Atlantic hurricane season. Many large companies have stopped covering the coast, and now smaller firms are going under after Louisiana was hit with two major hurricanes in the last two years.
Foret says the insurance shakeup will exacerbate an already slow-moving disaster recovery.
“Actually driving by those things and seeing them broken and destroyed every day has a compounding effect,” he says. “It’s been more frustrating than I thought it would be.”
His own house is still in need of repair – his kitchen roof is covered with a tarp while waiting for a contractor, which is hard to come by. Now he’s trying to iron out the complication with his insurance agent, Tracy Bennett, at La Terre Insurance Agency.
He handed her the envelopes from the new company, asking her if they had been paid. Bennett tells him his coverage is now with the state-run Louisiana Citizens Property Insurance Corporation.
“We still have people with damage from Ida, so if you have an open claim or damage that you’re still repairing, we have Citizen’s only option,” she says.
His office has been overwhelmed trying to help hundreds of clients like Foret who have either had their insurance companies go bankrupt or haven’t renewed policies on the coast.
“I’ve been in insurance since I can remember, and this is really the lowest point I’ve ever seen,” Bennett says.
“This is a crisis,” says Louisiana Insurance Commissioner Jim Donelon.
And one he says is what happened in 2005 after Katrina and Rita devastated the state. Several major national firms dropped wind insurance offerings in South Louisiana. So the state turned to about 30 regional firms to fill the void.
But after $22 billion in losses from Category 4 hurricanes Laura in 2020 and Ida last year, it’s become too much for some companies to handle.
“Unfortunately, half a dozen of them have now gone into receivership,” Donnellon says.
The Insurance Commissioner is not immune. Donelon and his wife are among 140,000 property owners who lost their policies and had to find new coverage. Half of those policies are taken by other firms, he says. But the burden falls on the citizenry—the state-run insurer of last resort.
“They’re absorbing it, but it’s not pretty,” he says. “They’re inundated.”
By the end of the year, Citizens will triple the number of its policies, he said. And those government policies are more expensive than private insurers, whose rates have also risen. Adding to the pain, flood premiums through the National Flood Insurance Program are also on the rise.
Donelon says legislation passed earlier this year requires insurance companies to have more capital to operate in Louisiana, which should prevent another wave of liquidity. He says it’s important for both the state and the national economy to have solvent companies willing and able to write policies here.
“Coastal Louisiana is more burdened than any other part of the country because we really have a working coast,” he says, pointing to oil and gas extraction, port activity, and the seafood industry.
“We have to support those people,” Donnellon says. “I believe we can meet that challenge with the private sector even though it will be expensive.”
Houma insurance agent Bennett says her clients are feeling the pain.
“I can tell you right here that it’s been crippling,” she says. “It’s scary.”
At a minimum, the new coverage is adding a few hundred dollars to the mortgage.
Houma is a mostly working-class city in Terrebonne Parish—an area threaded with bayous that leads to the Gulf of Mexico at its southern end. According to the U.S. Census Bureau, the median household income is about $45,000 per year, compared to about $65,ooo for the nation.
Foret says that doesn’t leave much wiggle room to cope with high insurance costs, inflation, hurricane recovery, and the ongoing threat from climate change, which includes more frequent and intense storms and rising sea levels.
“We’re on it,” Foret says. “As we’re at it’s going to prevent people from being able to live on the coast.”
Climate migration is a politically charged conversation. But it is happening slowly with every catastrophic event. Forte has seen it in his own family. His father grew up in the Cocodrie community on the bay, then moved to the town of Bayou Terrebonne after he married. Foret, now a father of one, has moved even further north to Huma.
“What if it’s part of our culture that we live away from rising water?” he asks.
You can see evidence of migration from far south Terrebonne Parish, where schools and fire stations are out of commission. Many homes are abandoned and look as they did a week after Ida struck – roofs torn off and furniture scattered in the rubble.
Alex Kolker, a professor at LUMCON, the University of Louisiana Marine Consortium in Cocoadri, says the high cost of cleaning, rebuilding and now insuring can transform these cities.
“I think it makes these areas very, very difficult to live in and difficult for the communities that people want to live in,” Kolker says. “So I think you look at climate migration and the possibility of people moving elsewhere.”
Kolker says what’s happening here should be a wake-up call.
“The real issue is that it’s not just a few isolated people in rural Terrebonne Parish,” he says. “It’s that this could happen to a lot of people across the country in the not-too-distant future.”
Fanny Celestin’s experience after Hurricane Ida shows how people are displaced from their communities in disasters. His public housing apartment in Houma was condemned after Ida. She was 59 years old and lost all her belongings.
“It’s hard to talk about it without crying,” she says.
Because of the lack of housing near the coast, Celestine stayed for months in a hotel 100 miles away in Lafayette before moving into a FEMA trailer closer to home. It is on an isolated gravel plain far from the city, with no public transport. He doesn’t have a car.
“It’s a place to live, but I’m from Houma,” she says. “And I want to go back to where I’m from.”
She is tired of relying on relatives to take her to the doctor or shopping, and wants to get back to a normal life.
“Like go to the store and get groceries, or take a walk at the mall,” says Celestine. “That would make a lot of sense. But what can we do?”
Foret is also trying to get back to normal. And he sees the literal sign behind the tractor-trailer rig.
“Look — it’s a McDonald’s sign,” he says. “We can’t get insurance but, look, they’re replacing the golden arches.”
After nearly a year of seeing the golden arches storm the corner, this repair gives him a glimmer of hope that things will get better.