Settlement Reached on North Carolina Rate Bureau Homeowners Insurance Request
Mar 6, 2013
Negotiated rate increase less than half of insurance companies’ request
North Carolina Insurance Commissioner Wayne Goodwin signed a settlement agreement with homeowners insurance companies yesterday, March 5, 2013, in which he allowed an overall statewide average rate increase of 7 percent, varying by territory and form, beginning July 1, 2013.
The insurance companies, represented by the North Carolina Rate Bureau, had requested an overall statewide average rate increase of 17.7 percent on October 1, 2012. The difference between the requested and settled rates amounts to $237 million in savings to policyholders.
According to the North Carolina Department of Insurance (NCDI), whose experts spent months studying the insurance companies’ request, it became apparent that some increase was justified, largely due to the steadily rising cost of reinsurance related to hurricane risks and ongoing concerns regarding availability. In order to minimize the increase, the NCDI elected to settle on rates, eliminating the need for the hearing that had been scheduled for June 3.
“Homeowners insurance is a very complex issue. We face a great challenge in making sure that it is not only affordable, but available, to consumers across the state,” Commissioner Goodwin said. “I feel this settlement helps strike that balance, and I am pleased that the increase will be significantly smaller than what insurers originally requested.”
The last homeowners insurance rate filing occurred in 2008 when the insurance companies requested a 19.5 percent statewide average increase. A settlement agreement allowed for a 4.05 percent statewide average increase to go into effect in May 2009.
Related documents provided by the NCDI are available through the hyperlinks below:
- Homeowners insurance settlement agreement
- Homeowners rate revisions by territory
- North Carolina territory map
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