North Carolinians to see an average 15% rate increase for homeowners’ insurance over two years
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Flood waters like these that resulted from Hurricane Florence in in Lumberton in 2018 are a growing driver of costs and rate hikes in the insurance industry. (Photo by Joe Raedle/Getty Images)
State Insurance Commissioner Mike Causey and insurance companies have negotiated a 15% rate increase for homeowners insurance over two years.
Under the settlement, which ends the N.C. Department of Insurance’s legal dispute with insurance companies, the average rate will increase by 7.5% on June 1 and 7.5% on June 1, 2026.
The N.C. Rate Bureau had requested an average 42.2%, with proposed increases of 99.4% in some coastal areas. The Rate Bureau represents companies that write insurance policies. It cited a higher cost of doing business due to climate change, which produces more powerful hurricanes and more severe flooding, for it’s proposed rate increase.
Beach areas in Brunswick, Carteret, New Hanover, Onslow and Pender counties are among the big winners in the settlement. The Rate Bureau had recommended a 99.4% rate increase for them. Under the new agreement, the areas will pay a 31.9% increase — 16% this year and 15.9% in 2026 — over the next two years.
Click here to view the changes by territory.
Causey said North Carolina homeowners will save approximately $777 million in insurance premiums over the next two years due to the negotiated rate.
“I fought for consumers and knocked them back to 7.5% increases over two years with a maximum of 35% in any territory,” Causey said in a statement. “We consider this settlement a big win for both homeowners and North Carolina.”
Causey said the negotiated rates are “sufficient to make sure that insurance companies, who have paid out large sums due to natural disasters and face increasing reinsurance costs due to national catastrophes, have adequate funds on hand to pay claims.”
In addition, the agreement prohibits the Rate Bureau from undertaking an effort to increase rates again before June 1, 2027.
The proposed rate increase was a key point contention in last year’s insurance commissioner’s race. Causey’s challenger, Sen. Natasha Marcus, D-Mecklenburg, criticized Causey for negotiating settlements with insurance companies behind closed doors.
Marcus called on Causey to hold public hearings to require insurance companies to present evidence for rate hike under oath.
Raleigh, NC