Insurers Sending ‘Consent to Rate’ Letters to North Carolina Homeowners

January 27, 2015

North Carolina homeowners are being told to pay higher insurance premiums or risk losing their coverage under a law that allows companies to pay more than the state has approved.

The StarNews of Wilmington reported insurance companies are sending “consent to rate” letters under which homeowners agree to a higher rate or risk losing their coverage.

Sen. Michael Lee, R-New Hanover, a member of the Senate Insurance Committee said legislators need to look at the consent to rate law. “It’s a big concern for a lot of folks in our area,” Lee said.

The state insurance commissioner last month ruled against any increase in homeowners’ rates. The N.C. Rate Bureau, which represents insurers, sought an average 25.6 percent increase statewide and up to 35 percent in parts of the Wilmington area.

Terry Wilkerson of Wilmington said his insurer, Travelers, gave him 10 days to decide whether to accept an increase of more than 120 percent. Travelers had provided his coverage for 15 years, he said.

“Our use of consent to rate is fully compliant with North Carolina law,” Travelers said in a statement. “There are instances when we charge more than the state’s approved rate to reflect the risks customers are facing and to keep up with the increasing costs to repair, replace and rebuild property.”

A Travelers spokesman also said that the proposed increase for Wilkerson was not typical.

Insurance companies are within their rights under North Carolina law, said Kerry Hall, spokeswoman for the state Department of Insurance. Insurance companies can increase premiums by up to 250 percent if the customer agrees, she said.

Rep. Susi Hamilton, D-New Hanover, said she recommended that people who receive a consent to rate letter contact the Insurance Department and “look into more customer-friendly insurers.”

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Latest Comments

  • July 30, 2017 at 7:17 pm
    Prachi says:
    Hello, Did you get any help from the NC DOI? Was this issue resolved? I am in a similar situation and would like to hear your experience. Thank you.
  • April 6, 2017 at 5:06 pm
    Helen Wall says:
    Mike I don't understand how you can say Farm Bureau isn't using the CTR letters. I have had Homeowners and Auto Ins with Farm Bureau for at least 40 years, I received the CTR... read more
  • December 10, 2016 at 7:46 am
    Randy says:
    I would like to get a few 100 of my friends that homes are paid for and enter into a home owners savings plan. Let's cut the insurance company's out,

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