State Insurance Commissioner Jim Donelon has argued since he took over in 2006 that the best way to combat Louisiana’s high insurance rates is to make the state a better place to do business.

Attracting more insurance companies would bring the competition that would lower the rates to cover automobiles and homes that most of the state’s residents are required to purchase. And to that extent, Donelon has succeeded — 22 new insurance companies operate in Louisiana that weren’t here in 2005.

But as the 70-year-old commissioner seeks a third term in Saturday’s election, he faces three challengers who argue the strategy flat didn’t work. Louisiana residents pay higher premiums than nearly everyone else in the country.

“Over the last four years, insurance rates have once again skyrocketed,” said Democratic contender Donald Hodge, a Baton Rouge lawyer who polled 314,317 ballots against Donelon in 2011. Donelon won with 67 percent of the vote.

“Louisiana needs a voice for the individual,” said Democratic opponent Charlotte McDaniel McGehee, a lawyer from Prairieville, adding that Louisiana residents spend 18.1 percent of their median annual earnings on insurance.

“We’re not being treated fairly by the insurance industry,” said Republican Matt Parker, of Calhoun. He’s the owner of a West Monroe car repair business that is part of a nationwide lawsuit claiming insurers regularly press body shops to use substandard replacement parts to fix cars their policies cover.

All three allege Donelon, who also serves on the Executive Committee of the National Association of Insurance Commissioners, is too close to the insurance industry he regulates and relies on contributions from those companies for his campaign war chest.

Donelon spent $95,731 in the last two weeks of September, which is nearly three times the $35,530 that all three challengers, together, reported having on hand in mid-October. Donelon told the Ethics Board that he still had $349,566 available to spend on the campaign.

“How do you regulate an industry that you’re taking all that money from?” Parker asked at qualifying in August.

Hodges said, “Louisiana doesn’t actually have an insurance commissioner. The insurance companies have an insurance commissioner.”

At qualifying, Donelon dismissed the complaints, saying it’s a knee-jerk reaction raised against all incumbents. “I don’t think voters will ultimately cast their votes based upon how campaign funds ought to be raised,” he said.

He took over the office after the short reign of Robert Wooley, who rejoined the private sector, and continued his boss’s work putting the department back in order after three consecutive commissioners ended up in prison.

Under Donelon’s watch, the politically appointed Insurance Rating Commission was abolished — insurers claimed the panel’s arbitrariness kept them from operating in Louisiana — and the duties of overseeing rates charged to customers were transferred to the Commissioner’s Office.

He used incentive programs and pushed changes in insurance law to attract companies to sell policies in a state so vulnerable to catastrophic natural disasters. Louisiana has the third highest, in total dollars, property losses in the nation, trailing only the much larger states of Florida and Texas.

Donelon pointed out that the roughly 2 percent increase in Louisiana homeowners policy rates in 2014 was the lowest since 2005.

Still, Louisiana homeowners pay an average $1,722 for the property insurance that bankers require to finance the residences, according to the Insurance Information Institute, an industry group. The national average is $952.

And nearly all Louisiana policies now include a deductible that kicks in when a named storm enters the Gulf of Mexico. For a $200,000 residence, the homeowner must pay the first $10,000 in damages.

But plenty of consumers are angered at having no choice — most financiers require insurance before giving mortgages — but to buy policies at high rates that cover little during the times when their homes are most vulnerable to damage.

“Insurance rates have become so outlandish that people need someone to represent them,” McGehee said in August. Homeowners are telling her that they’re having trouble making the payments. As a lawyer whose firm handles wrongful termination and civil rights litigation, McGehee said the time has come for a commissioner who includes consumer protection as part of the job portfolio.

Louisiana is the fifth most expensive state for buying automobile insurance, with car owners paying an average $1,774 per year, compared with the U.S. average of $1,311, the Insurance Information Institute reports.

NerdWallet, a consumer website, compared the rates for a 26-year-old man without any history of accidents, insuring a 2012 Toyota Camry with a high-end liability policy with limits of $100,000 bodily injury per person, $300,000 bodily injury per accident, $50,000 property damage liability limits and a $500 deductible.

The group found New Orleans drivers paid the second highest insurance prices in the country, at an average of $4,310 per year. Baton Rouge came in fifth, with a $3,364 annual price tag.

NAIC says traffic density and per capita income have a significant impact on how much is charged for auto insurance, along with repair costs and liability requirements.

On the NAIC list but much lower in significance is the ease victims have to pursue their claims in court. Insurance companies pay the damages up to the liability limits if the driver they insured is found at fault for the accident.

But that is a key reason Louisiana insurers give for higher rates in this state.

Insurance companies, the business community and the politicians they support are aggressively pushing what they call “tort reform” — changes to the judicial system that would make it more difficult for victims to sue.

Parker, who has never run for office before, criticized Donelon as a longtime politician, pointing out that the commissioner has held elective office in Jefferson Parish and in the state Legislature pretty much nonstop from 1976 until joining Wooley’s staff in 2001. Donelon had run unsuccessfully for the U.S. House, the U.S. Senate, a state district judgeship and a couple other offices.

Parker, whose role in the national lawsuit by body shop owners against insurance companies was featured on CNN, credited Donelon with building up competition. But he said the commissioner’s coziness with insurers has led to decisions that favor industry at the expense of consumers who are legally forbidden from driving unless they purchase insurance policies.

“Rates have gone up so much that working families, middle-class people, find it hard to stay up with,” Parker said.

Hodge said one way to reduce premium costs by 20 percent is to lower the minimum liability coverage. Louisiana requires drivers to buy policies that would pay up to $15,000 to treat the injuries of each person in an accident, but no more than $30,000 total, plus up to $25,000 for the damage to the vehicles.

Some legislators have been pushing to increase the minimum liability requirements, arguing that medical costs have skyrocketed and $25,000 doesn’t make a dent in replacing the SUVs that many people now drive.

Hodge said he also would re-establish the Insurance Rating Commission to vet requests by the companies for higher rates.

“If Louisiana citizens were paying the average Southern rate, we would be paying $3 billion less than we are now,” Hodge wrote on his website and repeats on the campaign trail. “That’s 3 billion more dollars that would and should be going into the Louisiana economy and not to companies located outside Louisiana.”

Follow Mark Ballard on Twitter, @MarkBallardCNB. For more coverage of government and politics, follow our Politics Blog at http://blogs.the advocate.com/politicsblog.