Cook Targets N.C. Rate Bureau Proposed Increase in Homeowners Insurance Rates | Eastern North Carolina Now

Press Release:

    Raleigh, N.C.     State Sen. Bill Cook (R-District 1) is encouraging the public to submit feedback before the end of today, Friday, December 29, 2017 to the N.C. Dept. of Insurance (DOI) concerning the N.C. Rate Bureau's proposed statewide average increase of 18.7 percent in homeowner's insurance rates for 2018. Last month, the Rate Bureau filed a notice with DOI seeking increases in homeowner's insurance rates as much as 25% in parts of eastern North Carolina. However, not only is eastern N.C. encountering proposed increases, the rate filing request for an increase of 21.9% in Wake and Durham counties while seeking a 23.5% rate increase in the Charlotte/Mecklenburg area. Below is a graph of all 100 counties proposed adjustments in homeowner's insurance for 2018.

    A Public Comment forum was held by DOI in Raleigh on Tuesday, Dec. 12, 2017. Sen. Cook attend the forum and expressed displeasure towards the proposed rate hike by the Rate Bureau and how it lacks sound rationale. A similar request was made three years ago, which was denied, in part, because the Rate Bureau was not using the right models and existing rates were already too high. Since the Dec. 12th forum, DOI has received more than 2,000 comments, predominantly via email. The deadline to submit a public comment on the proposed rate hike is today. Those wishing to do so may post online comments at 2017HomeInsurance@ncdoi.gov.

    "Every legislative session since getting to Raleigh in 2011, I have sponsored legislation that strengthens consumer protection in the North Carolina property insurance rate-making process. Several provisions have passed into law, such as notice requirements to a consent to rate for homeowner's insurance and allowing the use of catastrophe models in rate filings under certain circumstances," Cook said. "However, make no mistake, much more is needed. Likewise, we need thoughtful, vetted and meaningful reform to positively affect the ability of our citizens to attain reasonably priced property insurance across this entire state."

    Both the consent to rate notice requirements and the use of catastrophe models passed during the 2016 short legislative session via HB 287. Pursuant to the newly enacted law, homeowner's insurance carriers are now required to include a disclosure statement on their insured's initial written consent to rate forms notifying the insureds that the premium they are paying is above the rate approved by the North Carolina Rate Bureau. The disclosure statement must also be included on any renewals of or endorsements to policies where there was an increase above the approved rate. An insurer is required to give at least 30 days' notice of any consents to rate and notices.

    Additionally, now required under state law, certain minimum data is to be included in any property insurance rate filing where a catastrophe model is used. Moreover, the Rate Bureau is now required to identify each territory's wind and hail rate and requires the Department to publish the wind and hail rates for all territories in the State.

    "In the upcoming short legislative session, I plan to continue to draft commonsense and beneficial adjustments to the system by providing clarity to the consumer regarding insurance rates and claims, and a better market for the providing industry," Cook said. "When it comes to homeowners insurance, North Carolinians deserve fairness and transparency."

    After the public comment period closes today, Dec. 29, 2017 DOI has 50 days to respond to the Rate Bureau. If the Insurance Commissioner does nothing, the new rates will become effective on July 1, 2018. The Commissioner can negotiate a settlement on the filing which in years past has resulted in less than the Rate Bureau's proposed increases. The Insurance Commissioner also has the option to deny the filing which would result in a hearing/trial being held on the filing.

• Contact: Jordan Hennessy
•     jordan.hennessy@ncleg.net