The board for Louisiana Citizens Property Insurance Corp. voted Thursday to borrow $100 million through bonds to cover a cash shortfall of $70 million, despite the objections of the state's Treasurer.
The Times-Picayune says the move by the state's insurer of last resort avoids passing a new regular assessment onto taxpayers. However, Treasurer John Kennedy criticized the company's insolvency and asked that the state's legislature review the company's operations during this year's session that begins next month.
By law, Louisiana Citizens has to keep $125 million in cash on hand, or enough to cover one hurricane season. That is in addition to $75 million for reinsurance.
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