North Carolina auto insurers say no rate increase is needed for auto insurance policies in the coming year. Insurance commissioner, Wayne Goodwin, said the Department of Insurance has received the annual auto insurance rate filing from the North Carolina Rate Bureau. The Rate Bureau, which represents the auto insurance companies writing business in the state, submitted a filing on January 31, 2014, that requests no change in rates for private passenger car and motorcycle insurance policies for the coming year.
The rates currently in effect are the result of a rate cut and freeze initiated in 2009 that lowered car insurance rates to just below 2006 levels and required insurers to issue US$50 million in refunds. Rates have not gone up since then.
“The fact that today’s car insurance rates are no higher than they were in 2006 shows that North Carolina continues to have a strong and stable auto insurance market,” Goodwin said. “In North Carolina, we have more than 150 active auto insurance companies competing for our consumers’ business, and we have some of the lowest average rates in the country.”
According to the National Association of Insurance Commissioners, North Carolina has the sixth-lowest average auto insurance costs in the nation.
The current filing will be reviewed by the insurance department. Additionally, the department said it is reviewing the auto insurance territories, which is required to be done every 10 years under state law.
The North Carolina method of setting automobile insurance rates is unlike any in the country. Instead of each insurer filing their rates separately with the state Department of Insurance, all 160 companies operating in the state file their rate requests with the North Carolina Rate Bureau. The bureau in turn proposes a statewide base rate on behalf of the companies, which must be approved by the insurance commissioner.
Companies can only adjust individual policies by offering safe driver and other discounts, along with dividends.
There have been some legislative attempts to change the rate approval system, but, because of the low rates and opposition to change by some insurers and Goodwin, the attempts have been thwarted.