Homeowners’ insurance rates will increase on average by 15% statewide over the next two years, a significantly lower rate than the average 42.2% rate increase the North Carolina Rate Bureau (NCRB) was seeking.
North Carolina Insurance Commissioner Mike Causey announced Friday morning that his office and the NCRB signed an agreement that will see the average statewide base rate increase by 7.5% on June 1, and 7.5% on June 1, 2026. The Rate Bureau represents homeowners’ insurance companies in North Carolina.
The request was made in January 2024. A multitude of homeowners and others from across the state voiced their concerns at a public comment forum on Jan. 22, 2024, and by email and mail.
As expected, no one was in favor of the increase, which could have seen rates in coastal areas, like Swansboro in Onslow County go as high as 71.4% and 99% in places like Emerald Isle.
Those in the mountains were expected to see the lowest increase between 4%-20%, although that number may change within the context of the extreme flooding the area saw from Helene.
The new updated rates can be viewed here.
“The insurance companies wanted to raise our homeowners’ rates up to 99.4% in some areas and an average 42.2% statewide in a single year,” Causey said in a press release. “I fought for consumers and knocked them back to 7.5% increases over two years with a maximum of 35% in any territory. We consider this settlement a big win for both homeowners and North Carolina.”
In addition, the agreement prohibits the Rate Bureau from undertaking an effort to increase rates again before June 1, 2027.
“We’ve been in court since October 7, and it’s been a grueling process,” he told CJ in a phone interview last week. “It’s a hardship not only on our staff, but I heard a lot of complaints from the Rate Bureau and the insurance industry about the cost. That’s something back during the campaign, my opponent (former Democrat state Sen. Natasha Marcus) was attacking me all the time with “Rate Hike Mike” comments and saying that I’m not transparent. Well, that’s the furthest thing from the truth because there’s a process that has to be followed no matter who the commissioner is, and the public comment period is something we always have.”
Causey said once they find out about a proposed rate hike, they notify the press and ask for public comment. Most, if not all, say they don’t want their rates raised. When that occurs, by state law, the insurance commissioner sets up a court hearing date about ten months out. In the meantime, as granted by state law, the insurance commissioner can negotiate settlements if the insurance industry is willing to enter into those negotiations. When settlements were negotiated, he said they have been very favorable to consumers. That means a win for consumers and the state, which can save on court costs of a lengthy hearing.
This time, however, both sides were so far apart, he told CJ, they couldn’t make any progress in negotiations.
“They (NCRB) come back telling me it’s costing them $5000 an hour,” Causey said. “You could spend $1 to $2 million in a court case and come out far worse than you do if you can reach some sort of settlement. I hope that we’ll have a public announcement here in the next week or two on where we are.”
In the release, Causey said homeowners will save, on average, approximately $777 million in insurance premiums over the next two years compared to what the insurance companies requested.
“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.”