Regulations could benefit drivers in North Carolina
New regulations may have a major impact on drivers throughout North Carolina, if they are approved by the state’s lawmakers. These regulations would change the state’s auto insurance laws, which were created in 1957 and have seen little reform over the years. The regulations have managed to win strong support from the state’s insurance companies, many of whom are eager to see changes to insurance laws in order to better manage modern trends and risks in the state’s market.
Insurers show support for new regulations
Insurers note that they have to work differently in North Carolina than they do in every other state. This is due to the state’s somewhat archaic insurance laws that requires drivers to be issued insurance points for certain traffic infractions and accidents. These points are meant to affect the cost of insurance coverage and are generally considered a penalty for drivers that are unsafe on the roads. These points are issued as part of the state’s Safe Driver Incentive Plan, and insurers are required to increase a driver’s premiums by as much as 340% depending on how many points they have against them and the nature of the driver’s offense.
Companies want more flexibility in their ability to price insurance policies
Companies like State Farm have expressed a want to be more flexible on matters of insurance costs. State laws create a rigid structure that insurance companies must adhere to, making it difficult to price policies in a way that will be attractive to consumers. The financial burden that state regulations represent make auto insurance coverage, in general, unattractive, because drivers that take steps to be as safe as possible could still accrue insurance points against them for very minor infractions and accidents that are not their fault.
State statistics may be skewed by misleading information
According to the North Carolina Department of Insurance, drivers in the state enjoy the sixth lowest insurance rates in the U.S. This statistic may be misleading, however, as it only accounts for the cost of liability insurance coverage for drivers that have no infractions against them. When infractions are factored into the equation, auto insurance coverage in North Carolina becomes significantly more expensive when compared to coverage in other states.