Insurance Department orders hearing on homeowners’ rate hike request

Insurance Department orders hearing
on homeowners’ rate hike request

Insurance Commissioner Wayne Goodwin has ordered that a hearing be held in the matter of the insurance companies’ request to raise homeowners’ insurance rates, stating that the proposed rates appear to the Department of Insurance to be excessive and unfairly discriminatory.

The insurance companies, represented by the North Carolina Rate Bureau, requested an overall statewide average increase of 25.3 percent for homeowners insurance rates, varying by geographic territory, on Jan. 3, 2014.

The hearing is scheduled to begin on Aug. 6, at 10 a.m. at 430 N. Salisbury St. in Raleigh. The hearing is open to the public. However, there will be no opportunity for members of the public to speak at the hearing. DOI accepted comment from the public in January.

Experts from the N.C. Rate Bureau, on behalf of the insurance companies, and experts from NCDOI, representing the interests of the public, will present their cases for or against rate changes. Goodwin is to serve as the hearing officer and determine what, if any, rate adjustments are warranted.

Read the full of notice of hearing here: http://www.ncdoi.com/Media/Documents/2014%20Homeowners%20Insurance%20Hearing%20Notice.pdf

After an initial review of the Jan. 3 filing and more than 10,000 comments submitted by the public, NCDOI experts believe the requested rate increases are not justified. Among NCDOI’s concerns are:

The filing uses hypothetical data, rather than actual data, when calculating costs including those for the net costs of reinsurance and trended modeled hurricane loss costs.

The filing lacks necessary data, documentation and explanations to meet statutory burden of proof for rate increases.

Old data is used in the filing when more when more recent data should be available and included in the analysis.

The filing is available for public review on the department’s website. To view the entire filing, go to http://pserff.ncdoi.net/pc.html and enter the Serff Tracking Number NCRI-129361028.