Property Insurance: The Vanishing of Property Insurance for Louisianans – A Tale of Disparity

Property Insurance for Louisianans

So dear friends, down in coastal Louisiana, things are getting pretty dicey and insane, really. We're talking about some serious trouble brewing thanks to unpredictable flooding and crazy weather. And you know guys what's really messed up? Home insurance, which used to be everywhere, has pretty much disappeared into thin air. It's like poof and it's gone, leaving people high and dry.

But here's where it gets weird for all of us. Despite all this chaos, those gas and oil places scattered around the area are chilling like nothing's happening ( so crazy). They're not sweating over these issues like the rest of us. It's like they're in a whole different universe or something. Just wanted to lay it out straight, you know? It's a tough pill to swallow at least for me, but somebody's gotta say it.

Guys please picture this for a second: those LNG terminals are popping up along the Gulf coast like delicate little buds ( haha). And guess what? They've got this fancy insurance blanket that seems to shield them from all the crazy climate stuff going on ( don,t get shocked ). It's like they're living in their own bubble, totally unfazed by the mess around them.

Meanwhile, the crazy climate crisis is ramping up with stronger hurricanes and just relentless chaos. And who's taking the hit? Yeah, you guessed it, the folks in Louisiana who are already in a tough spot. It's like a dark cloud hanging over them.

And get this, for the folks dealing with home insurance, it's a real rollercoaster. One big hurricane can wreck everything and suddenly there's a flood of claims that can totally wreck their finances. It's a whole mess. Just wanted to break it down for you, no sugar-coating here. It's a tough situation, no doubt about it.

Oh, but for the unfortunate souls residing in Ironton, Hurricane Ida's cruel embrace in 2021 was more than a mere actuarial calculation. As the storm surge devoured their town, swallowing homes and even dislodging the resting places of the departed, sorrow and devastation ensued.

Here, let me tell you straight up guys, Ida was a real nightmare for the natives. It hit Louisiana like a freight train and messed up the property insurance scene big time ( cool isn,t it guys). I mean, imagine three major hurricanes tearing things apart in just a couple of years. It's like a never-ending cycle of destruction. And here's the kicker my dear friend almost two dozen insurance companies said "peace out" and bailed on the state. They couldn't handle the chaos or the financial hit. Some of them even bit the dust because of the mess Ida brought.

It's really really a tough pill to swallow, but that's the reality of it. Just keeping it real with you, no sugar-coating here. 

So my friends, after all the chaos, the people in Louisiana were left dealing with some messed-up situations. Some of them got caught in this really terribly crazy web of super expensive insurance costs that were just ridiculous. And then there were those who ended up with no protection at all, which is even worse.

But you want to hear something crazy? And you really won,t believe that. Down the road, not too far from Ironton, there's this massive liquefied natural gas terminal called Plaquemines LNG. It's this huge thing that's just standing there, kind of like a show-off, while all this insurance mess is going on.

Byron Encalade, who's in charge of the Louisiana Oystermen Association, isn't too happy about the whole deal ( to be frank with you). He's from Plaquemines Parish, and he's seen his home turn into a really naughty ghost town. People are getting out of there as fast as they can because of the insane insurance situation. And even now, the scars from Ida are still fresh, with some folks having to pay more for their insurance than their actual homes are worth.

It's like a messed-up story that keeps going, you know? Just wanted to give it to you straight, no fluff.

Look guys, it's a sad scene. We're talking about here. Those places where they've set up those LNG terminals? Well my dear friends, those areas have seen a lot of people leaving because of the crazy hurricanes wrecking everything. And as folks move out, the communities are falling apart like crazy. They can't even invest in important stuff like infrastructure anymore ( so sad guys ). And that means things are going downhill fast, with not much hope for a comeback. Jesse Keenan over at Tulane University is basically saying these parishes are dealing with a serious problem that's like a terminal illness. The hurricanes just keep coming, hitting hard and making any progress feel like a lost cause.

But wait my dear friends, there's more. Coastal Louisiana isn't just dealing with hurricanes. Nope, there's this other big problem and it is that the whole place is facing a ton of uncertainty. Alex Kolker, the expert on coastal stuff over at the Louisiana Universities Marine Consortium, is making it very clear that extreme weather is no joke here. Warm oceans and air are basically throwing fuel on the fire by making these hurricanes even stronger ( really fearsome guys ). And that's causing a whole lot of destruction with crazy rains and winds that don't let up. Plus, the land is sinking and the oceans are rising, so it's like a double whammy for the coast. The whole situation seems like it's inescapable. Louisiana is right on the edge of a seriously tough spot.

Now, let's talk about insurance. You'd probably think these big companies would be all about fighting climate change, right? (hehe) They talk the talk, setting goals to cut emissions and ditching coal projects. But when it comes to insuring those fossil fuel things? Well, they're not exactly backing down. Even though they're a big part of the whole climate mess and they're making the world riskier, they're not fully giving up on that stuff. It's like they're trying to have it both ways, and it's not sitting well.

Let's talk real about this whole situation guys. In the middle of all this whole mess, state legislatures and Republican attorneys general are basically giving insurers a pretty hard time. They're pushing them to ditch any eco-friendly stuff when they're deciding on insurance rates. And guess what my dear friends? The big insurers are backing off from supporting those UN plans to cut emissions. It's like they're running in the opposite direction ( really crazy ). And to top it off, the insurers for those LNG terminals are playing hide-and-seek. They're all "confidential business info" and keeping their names hidden like they're locked in a vault or something.

But hey, early in June, we got a little peek at one gas export terminal in Texas, the Freeport LNG.  My friends, it's like a small break from all the secrecy. Some specialty and reinsurance companies are backing Freeport up, with names like Liberty Mutual, AIG, and Chubb getting in on the action. Even though lots of insurers and LNG companies aren't spilling the beans about this drama, you can pretty much guess that Louisiana's terminals would have their own defenders in the same circles.

You know what's crazy guys? Along the beautiful Gulf coast, those oil and gas projects have always been a big deal for specialty insurance folks. And it's not just about the huge premiums they pay ( amazingly ), it's the sheer size of these projects that's a draw really guys. These deals are leaving a serious mark on the financial scene. We're talking about contracts with insane amounts of money and super high deductibles. It's like a story of wealth and risk all tangled up.

But here's the twist for all of us. The LNG terminals aren't putting all their eggs in one basket ( how smart ). Nope, they've got multiple insurers backing them up. That way, no single company has to handle all the losses. It's a delicate dance of spreading out the risk using things like capital reserves, debt, and equity. They're playing it smart to keep their LNG dreams alive.

And check this out: the LNG developers are going all out to reassure both insurers and government folks. They're putting up levees, seawalls, and other defenses to protect their terminals from the crazy storms. One of those setups is standing tall in Plaquemines—a massive 26-foot wall guarding the place.

Moving west, the Calcasieu ship channel could have as many as seven LNG terminals. But man, Hurricane Laura left a heavy mark there with a devastating 17-foot storm surge that wrecked Lake Charles. The folks in charge of two terminals, Sempra and Venture Global, wisely shut things down before the storm hit, and they came out okay.

Now, down in the southwest of Louisiana, Sempra Infrastructure is handling the Cameron LNG.  My dearest friends, hey're putting in a serious effort to keep the place safe from floods, winds, and surges. They've got an elevated facility and "critical equipment" in smart spots to show they're ready for whatever comes. But you know how it is, there are always skeptics and folks pushing for more answers.

So there you have it, my dear friend. I just wanted to lay it all out, no fancy stuff, just straight talk.

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