NC auto insurance rates going up, but not by 13.8 percent
RALEIGH, NC (WWAY) — Your auto insurance rate will go up in October, but not as much as it could have.
NC Insurance Commissioner Mike Causey announced a settlement agreement with the NC Rate Bureau in response to their request in February to raise auto insurance rates by 13.8 percent.
Instead of a nearly 14 percent increase, rates will go up an average of 2.2 percent.
“We are pleased that we were able to work out a settlement with the Rate Bureau that saved North Carolina consumers over a billion dollars,” said Causey. “It is unfortunate rates have to increase at all. But accidents from distracted driving are up, there are more people on the road because of lower gas prices, and higher medical and automobile repair costs are forcing auto rate increases all across the country.”
The rate change becomes effective for new and renewal policies beginning October 1.
The Rate Bureau, an independent organization representing all auto insurance companies doing business in the state, has agreed not to submit an auto rate filing in 2018 so this rate change will be in effect for two years until October 1, 2019.
Last year, traffic deaths jumped to the highest level in nearly a decade. According to the National Safety Council, the number of deadly accidents increased 7 percent in 2015 and was estimated to increase 6 percent in 2016.
The NC Department of Insurance says one of the biggest new factors in auto rate increases is due to distracted driving. According to a recent Wall Street Journal article, one insurance company said it had raised rates in 2015 6.5 percnet – and expected to raise rates this year 8 percnet – because of the impact of distracted driving.
“Recent data shows North Carolina has the seventh lowest average auto premiums in the nation,” said Commissioner Causey. “Our decision to settle was based on the increase in traffic deaths and other safety factors while also maintaining competition for insurance companies and options for consumers. We’ll continue to fight for lower, reasonable rates for consumers. Our number one job is to protect the consumer.”
Had the case gone to hearing on September 11 and the Rate Bureau had lost, the Rate Bureau by law would have been allowed to implement its 13.8 percent rate increase while it appealed the rate order to the NC Court of Appeals and the NC Supreme Court. It also would have been allowed to continue making annual rate filing for auto rate increases. Consumers could have been paying unwarranted higher rates for months and possibly years until the case was resolved by the courts.