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The N.C. Rate Bureau has filed a request with the N.C. Department of Insurance to raise homeowners’ insurance premiums in coastal counties by 30 percent.
Property owners have until tomorrow, Oct. 19, to make public comments about the N.C. Rate Bureau’s filing of a request with the N.C. Department of Insurance to raise homeowners’ insurance premiums throughout the state, with New Hanover and other coastal counties taking the largest hit — a proposed 30 percent hike.
Local opponents, including municipal officials and the Wilmington Regional Association of Realtors, said the bureau is unfairly targeting coastal areas by proposing large increases not supported by historical data. They plan to use a newly legislated public input process to express their disapproval at an upcoming public hearing and encourage other opponents to join them.
State Insurance Commissioner Wayne Goodwin will make the final decision.
Under the proposed rates listed in the filing, the areas east of the Atlantic Intracoastal Waterway in Brunswick, Carteret, New Hanover, Onslow and Pender counties would experience an increase of about $457 per year based on $75,000 of coverage, stated Kathleen Riely, governmental affairs director for the Wilmington Regional Association of Realtors. Inland areas in those same counties would see an increase of about $315 per year based on the same amount, Riely said.
On Oct. 17, Riely and many others who disagree with the proposed increases will go to Raleigh to attend the public hearing allowing concerned citizens to affect the rate change.
The State Department of Insurance has scheduled the hearing for 9:30 a.m. to 4 p.m. in the Jim Long Hearing Room of the Dobbs Building, 430 N. Salisbury St., in downtown Raleigh.
Riely urged people who work in industries such as home building and real estate that have been “gravely harmed” by the economy to make their voices heard.
“[We] took a baseball bat to the knees,” she said about the coastal economy coupled with the insurance rate increases. “We just don’t need that right now. The data and the trends don’t support increases when there are decreases in the area.”
Wrightsville Beach Mayor David Cignotti agreed. He said the town board will most likely adopt and send a resolution opposing the increase to the state Department of Insurance. Other coastal towns are poised to do the same, Riely said.
“The rate increases, in our opinion, are unfair,” Cignotti said. “I’m a believer in incremental increases, not singling out coastal communities, [especially] when I don’t see the data that backs up the insurance companies’ request… . This has been an ongoing struggle.”
The rate bureau has proposed an average 17.7 percent rate increase, the rate filing states, although the bureau has determined a need for much greater increases, according to N.C. Department of Insurance public information director Kerry Hall.
The filing states that the data actually calls for an average 31.9 percent increase statewide, but the bureau is asking for 17.7 percent. According to the breakdown by territory, the rate bureau indicated a needed increase of more than 100 percent in coastal areas but asked for a 30 percent increase.
The filing also asked that the new rates go into effect June 2013.
Hall said the Department of Insurance welcomes public input concerning the increase requests and the data provided in the filing.
The N.C. Rate Bureau is an independent organization representing the state’s property and casualty insurers. The bureau establishes standard rates, rating plans, classification systems and forms for the lines of insurance within its jurisdiction.
In 2008, the N.C. Rate Bureau asked for an average 19.5 percent increase but received a 4 percent hike in a settlement agreement. Even with the settlement, coastal areas still received a 30 percent increase, while some inland counties saw decreases.
“It’s very obvious that it’s highly prejudicial against the coast,” Riely said.
But this time the opposition has a chance to fight back against what it believes are unfair increases.
Earlier this year, the N.C. General Assembly passed legislation requiring the insurance commissioner to call a public comment period on any bureau rate filing.
The legislation states that, during the hearing, “the burden of proving that the proposed rates are not excessive, inadequate, or unfairly discriminatory is on the bureau.” The public also has the right to inspect the bureau’s filed rate-cases, according to the legislation.
This is the first rate filing since the legislation was passed and the first since Goodwin took office as commissioner.
To send written comments, write to NCDOI, Attn: Bob Mack, Property and Casualty Division, 1201 Mail Service Center, Raleigh, NC 27699-1201, or email comments to: 2012homeowners@ncdoi.gov
