- Published on Saturday, 20 October 2012 21:52
- Written by Super User
The Wilmington City Council voted at their October 16, meeting to oppose proposed insurance rate increases across the State.
By WILLARD KILLOUGH III
WILMINGTON, NC - The Wilmington City Council voted at their October 16, meeting to oppose proposed insurance rate increases across the State.
On October 4th, State Insurance Commissioner Wayne Goodwin announced the Department of Insurance received a homeowner’s rate filing from the North Carolina Rate Bureau on Oct. 1. The Bureau, which is not affiliated with the Department and represents the property insurance companies writing business in the state, requested a statewide average increase of 17.7 percent, with a requested effective date of June 1, 2013.
The request calls for as much as 30% increase for coastal homeowners insurance rates.
At the Council's Tuesday meeting Kathleen Riely, WRAR Governmental Affairs Director, Cape Fear Coalition of Concerned Citizens, explained, "We are paying 163% more in our coastal homeowners insurance rates than we did in 1993" but those
in the Charlotte and Gaston County areas are paying less than in 1993. She said, "Who gets a decrease in their insurance rates?"
Council member Laura Padgett said, "Just off the top of my head, looking at this for the first time, it looks like there is a definite bias against the eastern strip of the state, east of I-95 that doesn't even exist where there are blizzards in the western part of the state. They are also seeing either decreases or miniscule increases."
Riely noted the western part of the state also experiences hailstorms.
Riely said, "You look at claims paid... 26% of claims paid for wind losses in this state came from the coast" and, "The other 82 counties incurred 74% of the total wind losses."
She said, "We repeatedly get hit with these astronomical rates and these increases yet if you look at the historical data it contradicts it. It's the other way around."
Riely said the Rate Bureau indicated by their calculations, "They feel an increase of 119.2% is warranted. This is what they indicated but this is what they are actually asking, 30%. So the increase the NC Rate Bureau is actually 30%" for areas along the coast.
Riely said a lot of people were planning to attend a hearing in Raleigh on the proposed increases.
Brunswick, Carteret, New Hanover, Onslow, Pender – Coastal Areas (areas east of the intracoastal waterway) will have an increase of approximately $457 per year based on $75,000 of coverage and the mainland areas in those same counties (areas inland of the intracoastal waterway) will have an increase of approximately $315 per year based on $75,000 of coverage.
Overall, the Rate Filing represents an average of 17.7% increase statewide in property insurance rates with the highest requested rate increase of 30% in eastern NC.
The Town of Kure Beach planned a van trip asking concerned citizens to ride along to Raleigh to voice their concerns at the October 17, hearing.
Riely explained, "Why is it so important to stop these? For obvious reasons. Homeowners, there are retirees here on fixed incomes. It's killing us. It's like gasoline, the prices keep going up. We need to live in a house, we need to have transportation."
She said, "This affects all of us. The real estate industry is tied so much into our economy, not just locally or statewide, but all across the country. We are just now starting to show signs of recovery and this will stifle any potential recovery the real estate industry has especially in this area. And a lot of homeowners are struggling to make their mortgage payments after the last significant increase implemented in 2009. Could this start another round of mortgage defaults?"
She said citizens can email or write the North Carolina Department of Insurance to submit comments.
Mayor Bill Saffo explained, "We think it's very unfair the coastal counties... are getting these types of increases where in Raleigh and Mecklenburg County, some of the other counties in the state are getting decreases, which we think is absolutely appalling. This is not right."
He said all of the communities along the coast, "Add so much vitality to the entire state and to be hit with this type of insurance increase again is not fair" especially based on the percentages of claims being lower for coastal counties than the rest of the state.
Padgett said she felt like the resolution opposing the increases was "too polite and didn't indicate that we are actually angry about this down here and feel we are being unfairly treated."
She said she would like an additional statement in the resolution saying the City, "Insist that insurance companies providing insurance in North Carolina do it on an equitable basis across the state of North Carolina even if it involves going back and changing some of the prior rates."
She said, "I think it's time we stuck up for ourselves and ask them in the Department of Insurance to undo some of the damage they've done. Why are we paying almost double what some places are paying. One of the reasons for that is some areas have gotten decreases. Not only this increase needs to be done on an equitable basis but insurance rates across the state need to be done on an equitable basis."
The Council voted unanimously to adopt the resolution.
The resolution states, " Whereas, the North Carolina Rate Bureau is recommending to the North Carolina Department of Insurance a 30 percent rate increase for homeowners’ insurance for the coastal counties of New Hanover, Brunswick, Pender, Onslow and Carteret, and a statewide average increase of 17.7 percent ; and Whereas, the proposal comes after a 17.5 percent increase for coastal areas in 2009, in addition to rate increases in every rate cycle since 1992; and Whereas, homeowners in coastal communities
already pay premiums at two to three times the rate charged for inland properties in addition to having separate wind and hail policies."
The resolution states, "Whereas, the disparity between rates in the coastal counties and the inland counties is unwarranted and will once again place an undue and excessive burden on homeowners in coastal counties; and Whereas, state law now mandates the North Carolina Department of Insurance to consider public comments prior to adopting rate increases; Therefore, be it resolved that the Wilmington City Council opposes the rate increase requested by
the insurance industry for the citizens and homeowners of New Hanover County. The Wilmington City Council further encourages citizens to file their own comments with the Department of Insurance before the October 19, 2012 deadline."
Homeowners in coastal communities already pay premiums at two to three times the rate charged for inland properties, in addition to having separate wind and hail policies.
The NC DOI has 50 days to respond to the filing - either approve, call for public hearing or negotiate rates with the NC Rate Bureau.
Legislation passed earlier this year mandates that the Commissioner call a public comment period on any NC Rate Bureau Rate Filing. This is the first rate filing since the legislation was passed.