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4:31 a.m. • 2-10-12

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N.C. auto insurance rates to drop


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Automobile Insurance

State Insurance Commissioner Jim Long signed an order Thursday requiring a 16.1 percent reduction in automobile insurance rates and a 11.7 percent reduction in motorcycle liability rates.

The new rates will go into effect Jan. 1.

“After listening to testimony from both sides during the rate hearings in July and August, I found that the Rate Bureau’s request for a 12.9 percent increase just wasn’t warranted,” Long said in a statement. “It’s the largest increase they’ve requested in almost 15 years. I was surprised by the request, especially since last year the bureau filed for no change.”

Under state law, the insurance commissioner sets the maximum allowable rate that auto insurance companies can charge in North Carolina. The state has the sixth-lowest auto insurance rates in the nation.

During recent hearings, an attorney for the Department of Insurance argued that the market for auto insurance had not changed significantly since last year, when companies did not seek a rate increase.

Experts with the department said the Rate Bureau, which represents insurers, used faulty calculations when determining the proposed rate increase. For example, the bureau filing included claims arising from the North Carolina Reinsurance Facility, an entity that insures riskier drivers, even though bureau rates don't apply to those drivers.

The Rate Bureau can appeal Long order in court and can raise rates while awaiting the the appeals decision. The difference in the ordered rate and the implemented rate must be held in escrow and refunded to policyholders if the bureau loses its appeal.

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Dittos to Commissioner Long for not raising car insurance rates, but instead decreasing the rates in North Carolina. For one thing we do not need higher car insurance rates. WTG Commisioner Long.

therealtruthnc:

Please reread my comment. By law the RF must break even. It files its own rates. Long has never challenged RF rate filings. He did not bury the surcharge. The legislature did. Insurers can not discount RF business, according to the courts. Yes, we all make up the for the clean risks, maybe 2% of your premium. If you had a clean record and were put in the RF and your rates went up 40%, would you like it? That's what would happen without the clean risk law. I did not make your point. For what do you think your premium is paying? Could it be other person's driving mistakes? It's not like whole life insurance where you get a cash buildup. It's like term life insurance, pure protection. If you didn't have liability insurance and injured or killed another person through your negligence, there go your assets. Also, drivers with moving traffic violation convictions or who are at fault for accidents pay more. They're not getting a free ride.

Maybe people caught driving without insurance/licenses should have steeper fines to help those of use who do things LEGALLY offset the cost of our insurance.

NC's auto insurance system is a byzantine mess of socialist assumption; consumers here could save as much money and have much more choice if we had systems similar to neighboring states': http://www.carolinajournal.com/jhdailyjournal/display_jhdailyjournal.html?id=4920

I recently had an interesting talk with my insurance company, which shall remain unnamed.

The very helpful person was telling me how as a policyholder I could get a DISCOUNT for having a "good" student in college, another discount for college being more than 100 miles away, another discount for having side airbags, and another discount for having daytime running lights. I think there were others on the list...

When I asked why this was "news to me" she said she better first check on my STATE coverage. When she went to NC on her computer, she muttered something like "I can't believe this!!"

Essentially, although the insurance COMPANY offers such discounts to its drivers, North Carolina does NOT allow any such rate discounts on policies of residents.

And, as others have mentioned, we ALL are paying extra to help insure thus "uninsurable" bad drivers!

SO....I take this "rate drop" news with a very large grain of salt....

FE

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