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New threat to dismantle North Carolina’s insurance system…

The North Carolina General Assembly reconvened for the 2014 Session on May 14, 2014. This session is called the “Short Session” as it typically lasts for six weeks.

Thanks in part to concerned auto insurance policyholders located across the state, the North Carolina General Assembly adjourned on July 26, 2013 without dismantling the state’s competitive, low-cost auto insurance system.

While this threat was temporarily stopped, proponents are once again circulating legislation to push auto rates higher for many people, hurt consumers, and favor bad drivers over good drivers. The Protecting Low Automobile Insurance Rates Coalition stands united to oppose any radical legislation which would raise auto insurance rates, and destabilize North Carolina’s highly competitive, low-cost system.

- Higher Auto Insurance Prices: Lead to higher auto insurance rates for a million or more good drivers.
- Consumer Protection Lost: Severely limit the power and ability of North Carolina’s elected Commissioner of Insurance to protect consumers from higher rates
Comparison-Shop: Hard for drivers to comparison-shop, apples-to-apples policy, based on standard policy forms and minimum requirements. 
- Endanger Commuters: Result in more uninsured drivers, threatening everyone on our roads.
- Hurt Good Drivers: Push auto rates up for 70 percent of the drivers in our state’s “Reinsurance Facility,” drivers with no motor vehicle convictions and no license points – 1 million people.
- Help Bad Drivers: Enable insurers to charge higher rates for speeding tickets that are dismissed and drivers
found not guilty, while cutting rates for habitual drunk drivers, speeders, and reckless drivers.

The state’s insurance industry remains sharply divided on this controversial issue. Several large, out-of-state insurance companies are pushing legislation so that they can make more money off North Carolina’s consumers. They continue to push for massive change despite the fact that North Carolina’s robust and stable auto insurance market is already highly competitive, with 157 insurers vying daily for business. More importantly, North Carolina’s auto rates are the sixth-lowest in America, third-lowest for U.S. commuters, lowest in the Southeast. After inflation, rates are down 16% since 2006. Under current law, auto insurance companies are free to cut their prices as much as they want, any time they like.

Here is a review of North Carolina's auto insurance system...

The North Carolina Rate Bureau, the N.C. Department of Insurance, and the N.C. General Assembly all have a role in setting the state’s auto insurance rates. By law, they work together to ensure that “rates shall not be excessive, inadequate, or unfairly discriminatory.” All 157 of North Carolina’s auto insurers are members of the Rate Bureau. The Bureau does two things: 1) Propose an industry-wide system of rates to the Commissioner of Insurance, who is elected statewide every four years; and 2) Establish standard policy forms for all insurers to use, which enables consumers to comparison-shop among insurers.

Periodically, the Rate Bureau proposes industry-wide rates for auto insurance, which the elected Commissioner of Insurance reviews, based on the insurers’ reported claims, premiums, expenses, and profits. The elected commissioner may accept, reduce, or reject proposed rate increases. Meanwhile, under current state law, all auto insurers are free at any time to propose reducing the rates they charge their customers, which the Commissioner approves and which the Rate Bureau cannot prevent. There is no impediment to reducing rates under the current system.

Who supports Protecting Low Auto Insurance Rates...

This website was created to raise awareness about the negative impact to consumers of the proposal to dismantle North Carolina's competitive, low-cost system. Together, we believe it is important to provide factual information about this critical issue to help protect low auto insurance rates for North Carolinians.

• AAA Carolinas
• AAA Insurance
• AARP
• Alliance of Insurance Agents of North Carolina
• AmTrust Financial Services
• Dairyland Insurance Company
• Discovery Insurance
• Greenville Casualty
• Jenesis Software, Inc
• National General Insurance
• N.C. Farm Bureau
• Nationwide
• Peak Property and Casualty Insurance Corporation

• Professional Insurance Agents of North Carolina
• Sentry Insurance A Mutual Company

• Southern General Insurance