Insurers cut auto insurance costs in Louisiana through state's flex

State Farm Mutual Automobile Insurance cites the state's flex band law for its 2.1 percent cut in Louisiana auto insurance premiums in February.

The flex band law, which permits insurers to adjust premiums up or down by 10 percent, is allowing State Farm to move quickly to provide Louisiana drivers with immediate reductions, said Greg LaCost, senior counsel and regional manager for the Property Casualty Insurers Association of America, which supported the legislation.

The 2003 law allows insurers the freedom to adjust rates within a 10 percent band in a 12-month period without appearing before the Insurance Rating Commission. Before flex-band rating took effect, Louisiana's rating commission approved all rate changes, which critics say left consumers and businesses with fewer choices.

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