Tuesday morning the state insurance commissioner rejected a significant rate increase as petitioned by the North Carolina Rate Bureau to the state Department of Insurance.
READ MORE: Coastal insurance rates likely to be negotiated down from 99% increase request
The increase was projected to inflate by roughly 42% across North Carolina but would be significantly higher for homeowners in the coastal region — by 99%. The North Carolina Rate Bureau asked for the rates to become effective Aug. 1, 2024.
The bureau represents the insurance industry to make policy suggestions to the Department of Insurance, which then negotiates with the state government.
According to Causey’s office, the state has heard from around 25,000 North Carolina homeowners opposed to the hike. This doesn’t include people who spoke out at the public hearing held Jan. 22. Many listed rising costs on groceries, gas and other utilities already affecting monthly budgets.
“I heard loud and clear what the public said,” Causey said Tuesday, calling the potential insurance escalation unfair and discriminatory.
Locally, area government officials, including in Brunswick and New Hanover counties, signed letters sent to Causey in opposition. Brunswick County commissioners specifically said its region faced some of highest proposed increases, at 99.4% for Brunswick beach areas and 71.4% more for eastern coastal areas of the county.
One concern from commissioners is the disproportionate effect it will have on seniors on a fixed income. Brunswick County has the highest median age in the state at 57 years and 34% of the roughly 150,000 population is 65 years or older. Brunswick commissioners also stated insurance increases would impact affordable housing and home ownership.
Storm risk is the leading cost on insurance spikes in coastal areas, according to the rate bureau. The NCRB uses storm and climate modeling from Moody’s and Verisk credit services to inform calculations on catastrophic storm risk. COO Jared Chappell said last month those risks are trending upward.
“I think partly due to climate change and partly also due to greater exposure at the coast,” Chappell said. “We’ve seen more and more — especially after Covid — more and more people move into the coastal areas.”
Causey has issued a court hearing on the issue to take place Oct. 7 unless parties reach a settlement beforehand. The latter is normally followed as to not pass on the costs of court to the consumer.
The last time a rate increase went into effect in North Carolina was 2020. It was presented to go up by 24.5%, according to previous PCD reporting, but was negotiated down to 7.9%.
Tips or comments? Email info@localdailymedia.com.
Want to read more from PCD? Subscribe now and then sign up for our morning newsletter, Wilmington Wire, and get the headlines delivered to your inbox every morning.
