North Carolina drivers could see their automobile insurance premiums jump an average of 22.6% if a rate increase proposed by the North Carolina Rate Bureau is approved following a public hearing scheduled for Sept. 22.
The rate hike request, originally submitted in February, was denied by state Insurance Commissioner Mike Causey, in line with his history of rejecting initial rate filings. Causey confirmed the upcoming hearing, which will determine whether the requested increase will move forward.
After the hearing concludes, Causey will have 45 days to issue a decision. However, officials noted a potential settlement between the Rate Bureau and the Department of Insurance could occur at any time, possibly concluding the hearing early.
Among the proposed adjustments, comprehensive physical damage coverage would see the steepest increase, with a 75.8% hike requested. Collision coverage is slated for a more modest 3.7% rise, while motorcycle policies would benefit from a 9% rate reduction.
Several industry trends are contributing to upward pressure on insurance costs across the state. These include elevated vehicle replacement prices, increasingly complex repairs linked to advanced automotive technology, and a spike in litigated claims.
“Another factor is the losses incurred for nearly 23,000 totaled vehicles from the devastating flooding caused by Hurricane Helene last autumn,” Mark Friedlander, senior director of media relations at the Insurance Information Institute (Triple-I), told Insurance Business.
The Rate Bureau has not issued public comments regarding the filing. Data from BestLink shows the state’s largest auto insurers in 2023 included Allstate Insurance Group (18.8%), State Farm Group (14.9%), Berkshire Hathaway Insurance Group (12.82%), Progressive Insurance Group (11.68%), and North Carolina Farm Bureau Insurance Group (9.95%).
In a recent parallel case, the Department of Insurance spent nearly three months reviewing a proposed 42% increase in home insurance rates. That process ended in a negotiated settlement that ultimately allowed an average 7.5% increase.
