The North Carolina Department of Insurance (NCDOI) settled its dispute with the North Carolina Rate Bureau (NCRB), representing home insurance companies, about its proposed 42.2% rate increase. The settlement allows a 7.5% increase in June and another 7.5% increase in June 2026.
"I was shocked at the large request that was made, as were the people of North Carolina, because over the comment period, I received over 25,000 comments from homeowners all across North Carolina," said Mike Causey, insurance commissioner of North Carolina, in a
Jarred Chappell, COO of NCRB, stated that the rate increase in the settlement is insufficient and will put both the state and NCRB in the same position in two years, after the terms of the settlement expire. In the settlement, NCRB agreed to no further rate increases until after June 1, 2027.
"[NCRB] asked for a larger increase because that's what recent claims data called for, Chappell stated in a press release. "Storms have gotten stronger and more damaging, more people are living in disaster-prone areas, inflation in the construction industry has been particularly high and reinsurance costs have exploded. All these cost drivers remain an issue."
NCDOI and the NCRB could not reach an agreement after the request was first made in January 2024, and went to court about the
"[NCRB] was confident that the voluminous data it presented over the last few months of rate hearings made this case, but this industry always looks to work with regulators toward solutions," Chappell stated.
In a press release, Causey emphasized that insurers wanted to raise homeowners rates as much as 99.4% in the riskiest areas of the state. The settlement will save homeowners $777 million in premiums over the next two years, according to Causey.
"These rates are sufficient to make sure that insurance companies, who have paid out large sums due to natural disasters and face increasing reinsurance costs due to national catastrophes, have adequate funds on hand to pay claims," he stated.
Chappell of the NCRB noted that not every homeowner would see increases as high as the bureau's original proposition or the settlement increase. "The new base rates vary by region around the state, and customers should know: This doesn't mean your insurance premium will increase by those amounts," he stated. "That's an individualized process, with insurance carriers estimating risk for any property insured. The base rate limits what carriers can charge."
