This is what happens when a Commissioner pushes out Farm Bureau as the underwriter of the non-insurable risk. Mr. Goodwin is partially responsible for the rate hikes.
Presumably the rates requested are indicated by legitimate actuarial analysis. If they are not then I can understand the commissioners emotional response.
North Carolina has been rocked in recent years by increases in severity and frequency of both cat and non-cat windstorm losses, plus the hurricane potential is sobering for any insurer. If the numbers really indicate a rate shortfall of this magnitude then NC has some long term problems within their HO market.
Hope he isn’t grandstanding – these problems are probably not political, and confrontational solutions are usually ineffective. that said – this is a pretty stiff rate indication!
Thanks to Mr. Goodwin, NC will likely become the next Florida insurance market, and we will get our own “Citizens Insurance Company” owned by the state of NC and paid for by the insureds, at rates double what we have now. He is doing what any good democrat lawyer would do to stay in office!!!!!
“Democrat” lawyer? Sigh. This crosses party lines. Chris Christie has not exactly been supportive of any carrier in New Jersey. Bottom line, the government regardless of which party is in charge, needs to accept the fact that insurance companies are NOT not-for-profit organizations. Rates are actuarially justified and insurance companies don’t just pull them out of the air and ‘wouldn’t it be nice if we could charge this’. When there is a loss, homeowners expect a quality product. In order for the quality product to continue to be available, it must be priced adequately. For god’s sake, it’s a coastal state which is regularly hit by every hurricane.
Unless mistaken, north Carolina has not been fully stricken — not hit head on — by a hurricane in more than six, maybe ten, years. Weakened portions of a few storms have hit that state in recent years. Meanwhile, I believe the filing by the insurance companies wants to raise rates on the whole large state by 25% or more, not just the coast which it caps at a few percentage points above that.
I’m not sure what earlybird bases his comment on. It’s my understanding that insurance companies say they won’t write coverage on the tar heel coast and in eastern north Carolina even if Commissioner Goodwin approved rates at or close to the rate levels the insurance companies want.
Another round of the famous game. The NCRB asks for the world, then settles for something more in line with what they orginally wanted. They know the Commish never approves the initial request.
The fact that there was a just a rate increase and there were basically no cats this year, I find it difficult to understand what justifies such an increase. Time will tell though.
The HO market in NC is fine – sure there are coastal issues, but otherwise, the market is healthy. Don’t buy into the HO market is falling apart. If you think this, post the acturial facts that support it.
@thisisjustagame. To say the market is fine either means youre misinformed, or deliberately stuck your head in the sand. The actual filing can be found online with a lot of actuarial facts, modeling, and testimony. First of all, they are not even using data from 2013,2012 in their loss costs. Second, when they needed rate a few years ago and didnt get it, it still factors into the rate request, just later down the road. Every reasonable mind can agree that the Beach Plan is an impending disaster. Since the insurance companies, then EVERY taxpayer are on the hook through assessments once a major hurricane or series of storms, this risk must be built into the premium. In fact, the DOI / Leg are the ones that created the stupid law that insurance companies must operate at a profit.
Full disclosure,i dont work for an insurance company. But an agent who sells home insurance
I firmly believe that the government has no business regulating rates. Monitoring and ensuring financial solvency of admitted carriers? Of course. But nothing will work better to bring rates to appropropriate levels than plain old free martket competition. It’s hard to believe that most of Europe is so far ahead of us in this area, where government interference in the market place is more the rule than the exception.
Throughout my career I have often thought about how a gas station can just walk out to their sign and change their price when they want to, but the insurance industry has to go through so many hoops.
What happens if that gas station either prices itself out of the market or fails to generate enough revenue to finance it’s operations? It does not impact someone else besides the owner and his/her employees let alone potentially hundreds of thousands who may have a claim with a carrier that has become insolvent. Besides, it is much easier to recognize when one gas station charges more than another. Not so easy with insurance.
@Phoenix — So you want to do away with regulating rates but you still want state departments of insurance to ensure financial solvency of admitted carriers? Without regulating rates to some degree, how could an insurance commissioner ensure financial solvency of an insurance company?
Also, @Phoenix — keep in mind that if the states don’t reasonably regulate insurance companies in some way then the federal government will step in and do it instead. That’s unacceptable! I’d rather states do this than the federal government any day.
35 PERCENT HOMEOWNERS, INCREASE SOUGHT FOR COLUMBUS COUNTY WE WOULD BE MOVED IN OUR OWN RATE TERRITORY !!!! If we the people of Columbus county don,t stand up to the insurance companies and fight this I don,t know how we are going to pay all these Taxes and homeowners. Single family incomes just can,t keep going we are living to pay taxes and homeowners and the rest of our money is left is to pay Duke energy. For people who would like to weigh in on the rate request in person, there will will be a public comment session on Friday,Jan.24th 9:30 Am to 4:pm in the Jim Long Hearing Room of the Dobbs Building430 N.Salisbury St,Raleigh NC. Written public comments will be accepted from Jan 3 through Jan 31. Written comments should be mailed to: NCDOL,Att Bob Mack, Property& Casualty Division,1201 Mail Service Center,Raleigh NC 27699-1201 or emailed to 2014homeownersncdoi.gov. When I said Single Family really it will effect everyone in Columbus County !!!! We are one of the poorest County in the whole state of NC. NO JOBS FOR OUR KIDS AND OTHERS
This is what happens when a Commissioner pushes out Farm Bureau as the underwriter of the non-insurable risk. Mr. Goodwin is partially responsible for the rate hikes.
Presumably the rates requested are indicated by legitimate actuarial analysis. If they are not then I can understand the commissioners emotional response.
North Carolina has been rocked in recent years by increases in severity and frequency of both cat and non-cat windstorm losses, plus the hurricane potential is sobering for any insurer. If the numbers really indicate a rate shortfall of this magnitude then NC has some long term problems within their HO market.
Hope he isn’t grandstanding – these problems are probably not political, and confrontational solutions are usually ineffective. that said – this is a pretty stiff rate indication!
Thanks to Mr. Goodwin, NC will likely become the next Florida insurance market, and we will get our own “Citizens Insurance Company” owned by the state of NC and paid for by the insureds, at rates double what we have now. He is doing what any good democrat lawyer would do to stay in office!!!!!
“Democrat” lawyer? Sigh. This crosses party lines. Chris Christie has not exactly been supportive of any carrier in New Jersey. Bottom line, the government regardless of which party is in charge, needs to accept the fact that insurance companies are NOT not-for-profit organizations. Rates are actuarially justified and insurance companies don’t just pull them out of the air and ‘wouldn’t it be nice if we could charge this’. When there is a loss, homeowners expect a quality product. In order for the quality product to continue to be available, it must be priced adequately. For god’s sake, it’s a coastal state which is regularly hit by every hurricane.
Unless mistaken, north Carolina has not been fully stricken — not hit head on — by a hurricane in more than six, maybe ten, years. Weakened portions of a few storms have hit that state in recent years. Meanwhile, I believe the filing by the insurance companies wants to raise rates on the whole large state by 25% or more, not just the coast which it caps at a few percentage points above that.
I’m not sure what earlybird bases his comment on. It’s my understanding that insurance companies say they won’t write coverage on the tar heel coast and in eastern north Carolina even if Commissioner Goodwin approved rates at or close to the rate levels the insurance companies want.
Get ’em, Wayne!
Another round of the famous game. The NCRB asks for the world, then settles for something more in line with what they orginally wanted. They know the Commish never approves the initial request.
The fact that there was a just a rate increase and there were basically no cats this year, I find it difficult to understand what justifies such an increase. Time will tell though.
The HO market in NC is fine – sure there are coastal issues, but otherwise, the market is healthy. Don’t buy into the HO market is falling apart. If you think this, post the acturial facts that support it.
@thisisjustagame. To say the market is fine either means youre misinformed, or deliberately stuck your head in the sand. The actual filing can be found online with a lot of actuarial facts, modeling, and testimony. First of all, they are not even using data from 2013,2012 in their loss costs. Second, when they needed rate a few years ago and didnt get it, it still factors into the rate request, just later down the road. Every reasonable mind can agree that the Beach Plan is an impending disaster. Since the insurance companies, then EVERY taxpayer are on the hook through assessments once a major hurricane or series of storms, this risk must be built into the premium. In fact, the DOI / Leg are the ones that created the stupid law that insurance companies must operate at a profit.
Full disclosure,i dont work for an insurance company. But an agent who sells home insurance
I firmly believe that the government has no business regulating rates. Monitoring and ensuring financial solvency of admitted carriers? Of course. But nothing will work better to bring rates to appropropriate levels than plain old free martket competition. It’s hard to believe that most of Europe is so far ahead of us in this area, where government interference in the market place is more the rule than the exception.
Throughout my career I have often thought about how a gas station can just walk out to their sign and change their price when they want to, but the insurance industry has to go through so many hoops.
Auto PM,
What happens if that gas station either prices itself out of the market or fails to generate enough revenue to finance it’s operations? It does not impact someone else besides the owner and his/her employees let alone potentially hundreds of thousands who may have a claim with a carrier that has become insolvent. Besides, it is much easier to recognize when one gas station charges more than another. Not so easy with insurance.
@Phoenix — So you want to do away with regulating rates but you still want state departments of insurance to ensure financial solvency of admitted carriers? Without regulating rates to some degree, how could an insurance commissioner ensure financial solvency of an insurance company?
Also, @Phoenix — keep in mind that if the states don’t reasonably regulate insurance companies in some way then the federal government will step in and do it instead. That’s unacceptable! I’d rather states do this than the federal government any day.
35 PERCENT HOMEOWNERS, INCREASE SOUGHT FOR COLUMBUS COUNTY WE WOULD BE MOVED IN OUR OWN RATE TERRITORY !!!! If we the people of Columbus county don,t stand up to the insurance companies and fight this I don,t know how we are going to pay all these Taxes and homeowners. Single family incomes just can,t keep going we are living to pay taxes and homeowners and the rest of our money is left is to pay Duke energy. For people who would like to weigh in on the rate request in person, there will will be a public comment session on Friday,Jan.24th 9:30 Am to 4:pm in the Jim Long Hearing Room of the Dobbs Building430 N.Salisbury St,Raleigh NC. Written public comments will be accepted from Jan 3 through Jan 31. Written comments should be mailed to: NCDOL,Att Bob Mack, Property& Casualty Division,1201 Mail Service Center,Raleigh NC 27699-1201 or emailed to 2014homeownersncdoi.gov. When I said Single Family really it will effect everyone in Columbus County !!!! We are one of the poorest County in the whole state of NC. NO JOBS FOR OUR KIDS AND OTHERS