North Carolina: 2024 Homeowners Insurance Rate Increase Proposed

19 Jan

Recently, the North Carolina Rate Bureau requested that the N.C. Department of Insurance allow increases to homeowners’ insurance rates by an average of 42.2 percent.

If the NCDOI agrees, the proposed rates will go into effect Aug. 1. However, it is also possible that the NCDOI will not agree to the increase and deny the requested rates which will then lead to the insurance department negotiating with the NCRB until a settlement is reached.

The rate increases are reasonable in many inland areas, with some counties seeing an increase of only 4.3 percent. However, some coastal beach areas are in for a shocking increase with the counties of Brunswick, Carteret, Pender, Onslow and New Hanover looking at a rate increase of up to 99.4 percent. Orange and Chatham counties would go up 25.1 percent, while Durham County would see an increase of nearly 40 percent.

According to Stephanie Watkins-Cruz, the director of housing policy for the North Carolina Housing Coalition, inflation and climate change are two reasons that homeowners insurance is getting more expensive as well as the increase in natural disasters. In some areas, particularly beach areas, insurers are pulling out of the market completely. 

“On the homeownership side, a few things can happen,” she said in a recent Daily Tar Heel article. “You have your monthly mortgage. You also have a monthly insurance plan. Imagining that 99.4 percent — it’s astronomical, essentially doubling the bill that people are used to.”

Watkins-Cruz also said in the Daily Tar Heel article that the proposed insurance rate hike could particularly affect affordable housing rental properties and their developers. 

“It can be easy for people to try and ignore the affordable housing crisis if they’re not experiencing it,” Watkins-Cruz said in the Daily Tar Heel article. “However, this is one of those issues that is really going to hit widespread, it’s going to be very widespread in its impact.”

In the same article, Sarah Viñas, the director of the Affordable Housing and Community Connections department in the Town of Chapel Hill, said 60 percent of renters in Chapel Hill are cost burdened, meaning they spend more than 30 percent of their income on rent and utilities.

Russell Pierce, the executive director of Housing for New Hope in Durham, warned in the Daily Tar Heel article that there has been a significant increase in property values in the area which is pushing up the cost of rentals. According to Pierce, an insurance increase — considering how many people are cost burdened — could put people at risk of losing their housing.

According to Pierce in the Daily Tar Heel article, there are a high percentage of renters in Durham and that an increase in the cost of insurance would exacerbate already existing cost issues for communities in Durham. Particularly areas that have already been affected by gentrification and rising housing costs.

“We’re seeing very high eviction rates here, predominantly among people of color,” he said in the Daily Tar Heel article. “And so, when we’re looking at something like this, it’s a small thing in a way, but at this point, very small things can have big impacts because people are already so vulnerable.”

There will be two public comment forums held on Jan. 22 to allow the public to address the proposed rate increase. 

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