By By JONATHAN CLAYBORNE
jonathan@wdnweb.com
Staff Writer
A 20-county alliance is opposing an N.C. Rate Bureau request to raise the insurance rate for secondary dwellings statewide.
The alliance, called N.C. 20, will explore this and other topics Monday morning at a meeting in the New Bern Riverfront Convention Center.
N.C. 20 members recently traveled to Raleigh to make their presence known at a public-input session on the rate-elevation proposal.
The Rate Bureau has asked the N.C. Department of Insurance to consider raising the dwelling-policy rate by around 20 percent on average. This increase would apply to nonowner-occupied homes, the department said.
N.C. 20 argues this increase would have a disproportionate impact on the coast, which has a concentration of vacation homes and other secondary dwellings.
“The proposed rate increases reflect a possible actual premium increase of over $1,000 per year on a $300,000 structure for eastern NC dwelling policyholders,” reads a list of talking points taken from N.C. 20’s website.
Coastal interests should lobby for a change in the way insurance-rate increases are approved, said Tom Thompson, Beaufort County’s chief economic developer and chairman of N.C. 20.
“We’re going to push for elimination of the Rate Bureau to get back to a system where each company decides what it wants to charge … and goes to the (state insurance) commissioner and files their rate,” Thompson said.
State concerns about the possibility of experiencing a catastrophic hurricane on the coast are driving fears about insurance coverage, and those fears are overblown, Thompson suggested.
“We’ve never had a Category Five (on record),” he said, adding the last time the coast experienced a Category-4 storm was when Hurricane Hazel blew through in 1954.
“The Rate Bureau, in effect, is a legalized price-fixing mechanism,” Thompson asserted.
According to Kerry Hall, a spokeswoman for the Insurance Department, the public-comment period on the proposed increase ends Monday.
The Rate Bureau submitted its filing request Jan. 4, Hall related.
Since then, the Insurance Department has received 600 to 700 written comments via e-mail or regular mail, though some of these comments came in as form letters, according to Hall.
Hall expected more comments to arrive Saturday and Monday.
“(Insurance) Commissioner Wayne Goodwin has, under his administration, really made some steps to try to get the public involved or at least aware of the process,” said Hall.
When the department receives a Rate Bureau request, the two entities often try to agree upon a lower rate than originally sought, Hall pointed out.
If the two bodies disagree on the rate, a sort of quasi-judicial public hearing is held with Goodwin presiding, she explained.
Because of the role he could play in such a hearing, Goodwin wasn’t present at the public-comments session held Monday in Raleigh, Hall said.
The commissioner is supposed to remain impartial at this point in the process, she added.
Star Credle, secretary of the Beaufort County Board of Realtors, traveled to the Monday session with some other county residents, including Realtors.
While members of the local Realtors’ board haven’t taken a formal, collective position on the possible rate hike, “They’re all concerned,” Credle said.
She indicated the state isn’t considering the trickle-down cost effects the increase would have on people who rent homes.
“These people just don’t think about what little guys go through,” Credle concluded.