Causey Schedules Hearing to Settle Rate Dispute with North Carolina Insurers

February 11, 2019

In response to a filing by North Carolina insurers for a 17.4 percent rate increase in homeowners insurance rates, North Carolina Insurance Commissioner Mike Causey has set a Sept. 4, 2019 hearing date, saying he does not think the rate request is justified.

“There is a pervasive lack of documentation, explanation, and justification of both the data used, as well as the procedures and methodologies utilized in the filing,” Causey said in his hearing notice to the North Carolina Rate Bureau, which files rates on behalf of insurers in the state. “The proposed rates appear to be excessive and unfairly discriminatory.”

The hearing will be held unless the North Carolina Department of Insurance and NCRB are able to negotiate a settlement before that date. State law gives the state insurance commissioner 45 days to issue an order once the hearing concludes.

Once the order is issued, the NCRB has the right to appeal the decision to the N.C. Court of Appeals. A Court of Appeals order could then be appealed to the North Carolina Supreme Court.

NCDOI and NCRB can settle the proposed rate increase at any time during litigation.

The NCRB filed the average statewide 17.4 percent increase on Dec. 20, 2018. The filing covers insurance for residential property, tenants, and condominiums at varying rates around the state.

Under the NCRB proposal, the biggest increases would be felt along the coast. The NCRB has requested certain areas in western North Carolina receive small rate decreases. These areas include Cherokee, Clay, Graham, Jackson, and Macon counties. Rates for tenants and condominium insurance would see proposed decreases in other counties.

According to NCDOI, the NCRB attests the increase is needed to cover increased losses, hurricane losses and the net cost of reinsurance.

The NCRB represents insurance companies that write the state’s homeowners’, auto and workers’ compensation policies. It is a separate entity from NCDOI.

The public comment period for the proposed rate hike remains open until Feb. 26, 2019. There are three ways to comment:

  • A Public Comment forum will be held to listen to public input on the Rate Bureau’s rate increase request at the N.C. Department of Insurance’s Second Floor Hearing Room on Feb. 26, 2019, from 10 a.m. to 4:30 p.m.
  • Emailed public comments should be sent by Feb. 26, 2019, to 2018Homeowners@ncdoi.gov.
  • Written public comments should be mailed to Tricia Ford, Paralegal Administrator, to be received by Feb. 26, 2019, and addressed to 1201 Mail Service Center, Raleigh, N.C. 27699-1201.

All public comments will be shared with the N.C. Rate Bureau.

The last NCRB homeowners’ rate filing was in 2017. That year, the NCRB requested an average 18.9 percent statewide increase in homeowners’ insurance rates, but Causey settled, instead, on an average 4.8 percent increase.

The Sept. 4 hearing will begin at 10 a.m. in the Second Floor Hearing Room in the Albemarle Building, 325 N. Salisbury St. Raleigh.

Source: North Carolina Department of Insurance

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