Press Release from the Outer Banks Association of Realtors(r)

OBAR and OBHBA learned earlier today that NC Department of Insurance Commissioner Wayne Goodwin reached a settlement agreement with the NC Rate Bureau on the Homeowners Insurance Rate Filing that was submitted in October 2012. A public comment period was held on the filing shortly thereafter and over 9,000 comments were submitted. The NC Department of Insurance, upon reviewing of the filing and consideration of the comments, issued a Notice of Hearing on the filing to begin June 3, 2013. The Hearing will no longer be held. It would have been the first on a Homeowners Insurance Rate Filing since 1993 and would have given NCDOI the opportunity to further scrutinize the filing through testimony and evidence submitted by the NC Rate Bureau.

NC DOI called the hearing for numerous reasons:

  • “The data contained therein are so questionable that a property evaluation ……..is obstructed.
  • In many instances the filing lacks necessary data, documentation and explanations of methodology to meet the Bureau’s statutory burden of proof.
  • The filing is not clear, concise, internally consistent or readily understandable.
  • Due consideration has not been given to actual loss and expense experience within this State for the most recent three-year and five-year periods fo which such information is available.
  • The “net cost of reinsurance” provision in the filing appears to disregard the actual reinsurance experience in NC.
  • The filing appears to disregard the actual hurricane loss experience in NC.
  • The AIR computer model results are based upon outdated data and experience.
  • Evaluating the AIR Model is impeded by the fact that numerous assumptions, parameters, formulas, data and other components underlying that model have not been disclosed.”
  • and more!

To review the full Notice of Hearing go to:http://www.ncdoi.com/media/documents/NoticeOfHearingInTheFilingForRevisedHomeownersInsuranceRates.pdf

The NC Rate Bureau’s filing represented a 30% rate increase for eighteen NC coastal counties. Based on filing data however, indicated rates – those the Rate Bureau concluded were the actuarial sound rates needed – were as high as 119% more than current rates. The NC Rate Bureau capped the increase request at 30%.

This settlement agreement represents an overall statewide increase of 7% with the largest increases impacting coastal counties. The beach areas of the coast will see increases as of July 1, 2013 as high as almost 20%; inland coastal areas will see much lower increases. Homeowners insurance policyholders with NCIUA (Beach Plan) wind coverage will be impacted the greatest, since the largest portion of the rate is for wind coverage and NCIUA policies pay above the maximum approved rate. There are approximately 135,000 homeowners – wind only policyholders covered by the NCIUA.

The settlement agreement will cause rates to be higher than rates that have been in place since 1993 in Charlotte and 32 other NC counties. The increase in those areas is as much as 8.4% – an increase from $529 to $574, a difference of only $45 in twenty years. The below map outlines the impact of the increases on coastal North Carolina policyholders.

Check out the by North Carolina Homeowners Rate Revision Breakdown by Territory CLICKING HERE!

DEADLINE MARCH 15-  Homeowners Insurance Survey
NC Senate Majority Leader Harry Brown recently shared that he received more calls and complaints to his office about homeowners insurance than any other issue.  As noted above, rates are going up by as much as 17% in Dare, Currituck and Hyde counties and policyholders are facing even much flood insurance premiums due to Congressional NFIP reforms passed last year.
Please encourage those concerned about the rising costs to participate in a homeowners insurance survey. The survey has been developed by a multi-coastal-state coalition working to improve access to homeowners’ insurance coverage and the affordability of coverage for coastal policyholders.

MORE PARTICIPANTS ARE NEEDED! The survey deadline has been extended to March 15th. Please continue to share this survey with property owners, family and friends and encourage them to fill it out.

United Policyholders is hosting the survey. Their home page – www.uphelp.org – will have a pop-up window that will direct you to the survey or you can find it directly at http://www.uphelp.org/home-insurance-cost-and-quality-survey