Commissioner: Insurance bill could lead to higher rates

An industry group counters, saying it would let insurance companies offer innovative products that lower rates.

Currently, companies that sell auto insurance in North Carolina have to set their maximum possible rates through the North Carolina Rate Bureau. They can set lower rates but are not allowed to charge more than the ceiling. 

“North Carolina drivers will benefit from a more competitive, free-market system that reduces bureaucracy and eliminates unnecessary costs,” Meredith said in a news release put out by the industry group pushing for the changes.

Still, not all companies back the bill, and Goodwin said it would bad for consumers.

"This bill will have a devastating effect on North Carolina drivers," Goodwin said.

Insurers could raise rates by up to 12 percent a year on average without going through any sort of regulatory review, he said.

"This bill will lead to people paying more for automobile insurance," he said. "It does not preserve my ability to review car insurance rates."

Particularly troubling, he said, is the measure would allow rates to rise on good drivers as well as bad ones.

But insurance companies say that customers will actually save money in the long run. 

“Our independent agents want to be able to offer their clients the same innovative and cost saving products that all 49 other states offer to their citizens, and fully support changing this out-of-date, archaic system of pricing auto insurance,” said Kelley Erstine, chief executive of the Independent Insurance Agents of North Carolina.