A Guide for Commercial Auto Insurance
                     Understanding the New 
Insurance Law Reforms in 
Louisiana: A Guide for 
Commercial Auto Insurance
In January 2025, Louisiana introduced significant new 
insurance law reforms aimed at making the state 
more competitive for insurers. One of the most 
notable changes is the repeal of the "three-year rule," 
which previously prevented insurance companies from 
canceling or non-renewing policies that had been 
active for more than three years. This article will 
explain what these reforms mean for commercial auto 
insurance in Louisiana.
 What is the Three-Year Rule?
The three-year rule was a unique Louisiana law that 
protected policyholders by ensuring their insurance 
policies could not be canceled or non-renewed after 
three years, regardless of any changes in risk or 
claims history. This rule was intended to provide 
stability and security for long-term policyholders.
 Repeal of the Three-Year Rule
The new law, signed by Governor Jeff Landry, repeals 
the three-year rule, allowing insurance companies to 
drop up to 5% of their long-standing policies starting 
in 2025. This change aims to increase competition 
among insurers and stabilize the insurance market. 
However, it has raised concerns about consumer 
protections and the potential for increased premiums 
for some policyholders.
 Impact on Commercial Auto Insurance
For businesses in Louisiana that rely on commercial 
auto insurance, the repeal of the three-year rule 
means that insurers now have more flexibility in 
managing their policies. This could lead to more 
competitive pricing and better coverage options for 
businesses. However, it also means that businesses 
may need to be more proactive in reviewing their 
insurance policies and ensuring they have adequate 
coverage.
 Key Coverages for Commercial Auto 
Insurance
• Bodily Injury Liability: Covers medical expenses for 
injuries caused to others in an accident.
• Property Damage Liability: Covers damage to 
another person's property in an accident.
• Collision Coverage: Pays for repairs or replacement 
of your business vehicle if it is damaged in an 
accident.
• Comprehensive Coverage: Covers damages from 
non-collision events such as theft, fire, or natural 
disasters.
• Medical Payments Coverage: Covers medical 
expenses for your employees and their passengers in 
the event of an accident.
• Uninsured/Underinsured Motorist Coverage: Covers 
medical expenses and vehicle repairs if you are 
involved in an accident with an uninsured or 
underinsured driver.
 What Businesses Need to Know
With the new reforms, businesses should:
1. Review Current Policies: Ensure that your current 
commercial auto insurance policy meets your business 
needs and provides adequate coverage.
2. Stay Informed: Keep up-to-date with any further 
changes in insurance regulations and how they might 
affect your business.
3. Shop Around: Consider comparing quotes from 
different insurers to find the best coverage and rates 
for your business.
4. Consult an Expert: Work with an insurance agent or 
broker who can help you navigate the new regulations 
and find the best coverage options.
 Conclusion
The new insurance law reforms in Louisiana are 
designed to create a more competitive and stable 
insurance market. For businesses with commercial 
auto insurance, this means more flexibility and 
potentially better coverage options. However, it also 
requires businesses to be more vigilant in managing 
their insurance policies. By staying informed and 
working with knowledgeable professionals, businesses 
can ensure they have the coverage they need to 
protect their assets and employees.