Homeowners Insurance Rate Case Rescheduled for October

In early 2014, the North Carolina Rate Bureau (representing insurance companies in NC), requested an overall statewide average increase of 25.3 percent for homeowners insurance rates, varying by geographic territory. BASE spoke at the public hearing on January 24, expressing our continued concern and asking the Commissioner of Insurance to hold a full hearing.

Commissioner Goodwin called for the full hearing, which was scheduled to begin on Aug. 6, 2014. THIS HEARING HAS BEEN POSTPONED UNTIL OCTOBER 2014!

The hearing has been postponed to give department experts more time to prepare testimony after significant revisions were made to the original rate filing from the N.C. Rate Bureau. READ MORE

The hearing is open to the public; however, there will be no opportunity for members of the public to speak at the hearing. Experts from the N.C. Rate Bureau, on behalf of the insurance companies, and experts from NCDOI, representing the interests of the public, will present their cases for or against rate changes. Goodwin is to serve as the hearing officer and determine what, if any, rate adjustments are warranted.

After an initial review of the filing and more than 10,000 comments submitted by the public, NCDOI experts believe the requested rate increases are not justified. Among NCDOI’s concerns are:

• The filing uses hypothetical data, rather than actual data, when calculating costs including those for the net costs of reinsurance and trended modeled hurricane loss costs.
• The filing lacks necessary data, documentation and explanations to meet statutory burden of proof for rate increases.
• Old data is used in the filing when more when more recent data should be available and included in the analysis.

BASE hasn’t had an opportunity to review the NC Rate Bureau revisions. However, as we said in the public hearing in January, we strongly feel that any proposed increase for eastern North Carolina is excessive and unfairly discriminatory. We wholeheartedly support the Insurance Commissioner’s previous suggestion that the Rate Bureau withdraw the filing entirely.

In coastal North Carolina, the requested rate changes suggest increases of 35% in many areas. The 2014 proposed increase follows on the heels of an increase in 2012, which just went into effect within the last several months! In fact, coastal homeowners have faced increases in every rate cycle since 1992—most recently in both 2009 and 2012. Enough is enough.

For the first time in recent memory, the rate case as originally filed proposes 35% increases in major inland cities like Raleigh and Charlotte. It is important to note that while this percentage increase appears “equal” to the increases in coastal areas, recall that coastal areas pay 2-3 times more for the same types of homeowners policies (fire, theft, etc) which do not include wind/hail coverage.

For more information BASE’s efforts on homeowners insurance