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New mediation program set up for Ida insurance disputes

Two mediation companies are offering 90 minute sessions for $600. It can usually cost more than $6,000 per session.

NEW ORLEANS — The disputes between homeowners and insurance companies about hurricane Ida damage claims continue.

Insurance lawyers say it's only the beginning.

"We've just about seen it all," says Justin Chopin with the Chopin Law Firm.

From loss of use claims denied to adjusters just not showing up, Chopin is up to his neck in cases.

"When we start talking about when insurance companies are in good faith or in bad faith, that's where we come in," Chopin said.

But, now a new mediation program is available to help.

Two mediation companies are offering 90 minutes sessions for $600. You can go to a location in New Orleans or Baton Rouge.

"We're trying to focus on consumers who are dealing with their personal homeowners policy," said Insurance Commissioner, Jim Donelon.

In a press conference on Tuesday, Donelon said the limit per claim is $50,000.

"For $50,000, I think there are plenty of cases out there that will do the job," Chopin said. "You have a roof but you got tarps, you don't have any water intrusion. Yea, you should be OK."

Chopin says mediation can cost up to $6,000, and if there's no resolution that cost is usually split.

Through the mediation program, insurers can pay the $600 fee for the homeowner and either party can request or reject the mediation, and an unsuccessful mediation doesn't have to be the end.

"Supplemental claims are always available to be asked for and to be pursued all the way up to and including litigation, if necessary," Donelon said.

The state has used mandatory mediation before, helping 12,000 people in Lake Charles and New Orleans after hurricanes Katrina and Rita.

A recent report on claims from Laura, Delta and Zeta, said $10.1 billion had been paid to policy holders. The bulk of it comes from payouts for Laura's destruction at $8.6 billion.

So, this time around it's not mandatory because it's an added expense to the system.

"We are being stressed, our market is being stressed significantly by this event," Donelon said.

This program comes on the heels of FEMA's Risk Rating 2.0 that could send rates through the roof for Louisianans. Many of them already feeling effects as of last month.

But, for the hundreds-of-thousands of policy holders still waiting for a check, the option could help keep them out of court.

"I think this incentives homeowners, insurance companies, and attorneys to get the ball rolling on these smaller cases and get them moving," Chopin said.

The mediation program runs until June 30, 2022. To learn more, click here.