North Carolina Home Insurance Rates See Hikes for the First Time in Four Years
This photo shows road damage to Highway 12 near Rodanthe, NC or Mirlo Beach, NC.
North Carolina homeowners are in for some additional financial strains this year. The apex insurance regulatory authority in the state has allowed home insurance providers across North Carolina to increase policy rates by an average of 7 percent. The hike will come into effect from July 1st this year. This is the first home insurance rate hike in four years and homeowners will be glad to know that the North Carolina Rate Bureau and various insurance providers had requested a hike of 17.7 percent but the Department of Insurance settled for an amount less than this keeping in mind the affordability factor.
New Home Insurance Rates Across North Carolina
Although the home insurance rate in North Carolina has been increased all over the state, the hike will not be equal in all places. For instance, homeowners in Greensboro and Winston-Salem areas can rest assured in the knowledge that they will have to pay no more than 1 percent more on their existing home insurance prices. The residents of Durham and Raleigh too can breathe easy. According to the Department of Insurance, the home insurance rates in these two cities will not increase by any more than 2.8 percent.
On the other hand, some homeowners in Charlotte may well need to re-organize their finances because home insurance rates here are expected to rise by as much as 8.4 percent. This means that some residents may have to pay close to $600 as premiums for their annual policies for their $150,000 homes.
However, coastal residents of North Carolina will have to bear the heaviest brunt of this insurance rate hike. Premium amounts on annual policies can rise by as much as 19.8 percent in coastal areas in Brunswick, New Hanover, Carteret, Onslow, and Pender counties. Beachfront homeowners in Dare and Hyde counties may have to shell out as much 17 percent more on their existing home insurance policies.
The Reason for the Raise
Although the drastic rate hikes in the coastal areas of North Carolina have peeved many homeowners, Insurance Commissioner Wayne Goodwin says that this step was necessary. The homes in these areas face greater risks of hurricane damage than those inland and as such insurers have to face higher costs in the event of a natural disaster, which are common in these parts. Unless there was a considerable increase in the insurance premium rates for homes here, there was always the risk of insurers leaving the market or dropping coverage plans.
This hike in home insurance rates is a settlement of sorts because contrary to convention, there has been no hearing on the issue of a rate hike. Usually, insurance companies and representatives from the Insurance Department meet each other in a hearing session to debate over the request of a price hike initiated by the insurers. The insurance companies had proposed a price hike in October last year but by reaching a settlement with the state authorities, both parties have done away with the need for a hearing.
Meanwhile the homeowners in North Carolina are wondering if the hearing could have brought on a lesser degree of a hike!