January 30, 2015
NCAR is pursuing an aggressive legislative agenda that will make homeowners insurance affordable and accessible for North Carolina families. The plan addresses three key policy areas.
Reform the rate-setting process
o The current rate-making process lacks transparency, accuracy, and fairness.
o Insurance companies propose rate hikes based on out-of-state data and use modeling software that omits historical data.
o A reform bill unanimously passed in the House in the last session, but stalled in the Senate. NCAR will lobby for its re-introduction.
o Current law requires that the Insurance Commissioner either maintain or raise rates when a rate request is filed.
o State law should allow the Commissioner the flexibility and discretion to lower insurance rates.
Eliminate “consent to rate” letters
o A loophole in state law allows insurance companies to circumvent the Commissioner’s authority to deny a rate increase.
o Insurance companies issue a “consent to rate” ultimatum that forces homeowners to pay higher premiums or risk cancellation of their insurance policy.
o NCAR will lobby for bills that close this loophole. In the meantime, the NC Homeowners Alliance educates consumers on how to handle these letters.