POLICY CANCELLATIONS RESTRICTED

Louisiana Co-mmissioner of Insu-rance Robert Wooley issued emergency orders restricting insurers’ ability to cancel policies due to claims resulting from Hurricane Katrina. Wooley presented draft emergency orders at a summit in Atlanta, Ga., attended by insurance commissioners from hurricane-ravaged Gulf Coast states and 300 insurance company officials , according to the Associated Press.

Under the draft order, premium payments due after Aug. 26, 2005, the date Louisiana declared a state of emergency, are suspended. In addition, any policy cancellation notice issued after Aug. 26 is void while the state of emergency is in effect. Also, the order states: “No policy shall be cancelled or nonrenewed solely because of a claim resulting from Hurricane Katrina.”

Louisiana’s emergency orders place re-strictions on health insurers operating in seven severely damaged Louisiana parishes: Jefferson, Orleans, Plaquemines, St. Bernard, St. Tammany, Tangipahoa and Washington. The ‘Hurricane Katrina Seven Parish Zip Code List’ on the Louisiana Department of Insurance Web site at www.ldi.state.la.us contains the zip codes in the seven parishes affected by the order. Copies of the emergency orders are also on the Web site.

The orders suspend during the state of emergency, which is expected to end Sept. 25, all cancellation and termination provisions for health policies and states that restrictions relating to out-of-network access to healthcare services should be waived in the seven affected parishes. Also, in order to minimize policyholders’ out-of-pocket expenses, insurers must reimburse affected insureds at “the higher of the following: contracted reimbursement rate; highest benefit level or percentage in a policy; or at billed charge.”