Petes tip of the day: State ruling reduces coastal homeowners insurance rates By Rob Morris on December 19, 2014 wreckedhouse Most coastal damage is from storm surge and flooding, which are not covered by homeowners insurance. (Voice file) Outer Banks homeowners will get a rare break on the cost of insurance under a ruling that rejected a statewide rate increase and questioned how insurers calculate potential losses from hurricanes. The ruling by Insurance Commissioner Wayne Goodwin is a dramatic reversal of a request by the North Carolina Rate Bureau, which represents insurance companies, from an increase of as much as 35 percent in beach areas to a reduction of 9 percent. Estimates by the Department of Insurance show that rates on a $150,000 frame house will decrease to $2,259 from the current $2,482 in beach areas of Dare, Currituck and Hyde counties. The Rate Bureau’s request would have hiked rates to an estimated $3,352. Statewide, the commissioner authorized no increase. The net effect could be less, but the state, by law, cannot reduce rates. New rates go into affect June 15, 2015, according to a statement from the insurance department. “The rates I have ordered are the result of the most thorough inspection of North Carolina homeowners insurance rates in more than 20 years,” Goodwin said in the statement. “After considering all of the evidence and data available, I have determined that no factors or events justified the excessive rates requested by the insurance companies.” On average statewide, homeowners insurance rates will decrease by 0.3 percent, renter’s rates will increase by 11.2 percent, and condo owner’s rates will jump by 8.1 percent, the statement said. Goodwin held a hearing late last year on the insurance companies’ request to raise overall average rates by 25.6 percent. Experts from the Rate Bureau and Department of Insurance presented their cases in the first hearing on homeowners rates since 1992, the statement said. Goodwin’s rulings cited numerous flaws in modeling used by the RaTe Bureau to estimate potential losses from hurricanes. It included the possibility of a Category 5 hurricane hitting North Carolina, which has never happened. The ruling noted that insurers had agreed to raise rates statewide by an average of 7 percent in June 2013, significantly less that the 17.7 percent they had requested. “At the time of the present filing by the Bureau in January 2014, perhaps half of the state’s impacted homeowner consumers/policyholders had not even received notice of what their increase, if any, would be from the 2012 filing,” the commissioner’s ruling said. rates Click to see the full chart » Timeline Jan. 3, 2014: The North Carolina Rate Bureau files a request with NCDOI to raise homeowners insurance rates. Jan. 3-31, 2014: A public comment period is held on the rate filing. NCDOI receives more than 10,000 mailed or emailed comments, and approximately 25 people comment in-person. Feb. 19, 2014: Goodwin calls for a hearing on the rate request. Oct. 20- Nov. 12, 2014: Goodwin conducts hearing over 12 days. Dec. 18, 2014: Goodwin orders an overall average rate change of zero percent, effective June 1, 2015. Print Friendly Comments salvo jimmy December 20, 2014 11:40 am Calm before the storm? Millenial December 20, 2014 11:12 am What’s this? Government regulation that favors the citizen consumer? Dewe December 19, 2014 5:56 pm Woo hoo! Maybe there IS a Santa Claus! XZDC December 19, 2014 2:10 pm Well, kiss my grits ! Too good to be true……? sssshh…..listen for the other shoe. :o)
Posted on: Sun, 21 Dec 2014 12:04:15 +0000
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