Hearing on the subject of rising insurance rates has been postponed until October
In North Carolina, homeowners insurance providers are seeking to increase the premiums for their coverage. This has caused some controversy and a hearing had been scheduled for next month regarding the matter. The hearing would have allowed state lawmakers and regulators to better understand why insurers are proposing rate increases and determine whether or not these rate increases are necessary. The hearing has, however, been delayed until October.
Insurers seek to raise coverage rates by an average of 25.3%
The delay will allow North Carolina Department of Insurance more time to prepare testimony concerning the rate proposals. Regulators have some issue with these proposals, believing them to be unnecessary. Collectively, insurers are looking to raise rates on homeowners insurance coverage by an average of 25.3% beginning January of 2015. Regulators are not convinced that these rate increases are sorely needed.
Some homeowners are likely to see their rates grow more than others will
Rates will go up more for some homeowners than they will for others. For homeowners in areas that are deemed to be at high risk of natural disasters, rates could go up by as much as 35%. Those in less risky areas of the state could actually see their coverage become less expensive by about 2.7%. While rate decreases are welcomed by state regulators, rate increases are another matter, as they introduce a higher degree of financial stress to consumers ad have a significant impact on the overall economic activity of the state.
Insurers cite growing frequency of natural disasters as one of the reasons behind higher rates
Homeowners insurance coverage has been growing increasingly expensive in North Carolina for some time. This coverage is designed to defend against natural disasters and such disasters are becoming more common in the state. As disasters increase in frequency and intensity, insurers are facing greater financial risks and losses. In order to balance out this risk, they must raise rates on the coverage that they provide. Regulators are concerned, however, that some insurers may be using the potential for natural disasters to push for higher rates that are not necessary.
