Homeowners in North Carolina may soon want to compare home insurance rates, as they may find sharp increases in premiums due to a new proposal from insurers.
In recent weeks, insurers in the state have been looking to raise certain home insurance rates in North Carolina from 7 to 25 percent. The change, which would be made effective this year, would increase the price of coverage on some homes by an average of 21 percent statewide, according to estimates by The North Carolina Rate Bureau.
The insurers say the increases will be made on dwelling fire coverage. This kind of policy is offered to non-owner residents on rental, investment and properties not occupied by a full-time owner that do not qualify for a standard home insurance policy.
While this may not apply to every homeowner, many economists in the area say it could hurt North Carolina’s already sluggish housing market.
“It’s certainly not going to help that second home market,” Myles Stempin, the executive director of economic development for Carteret County, told Eastern North Carolina Today. “Any time you add to a distressed economy it’s a negative.”
Coastal communities, especially those that own multiple beachfront properties in the state, would likely see the biggest increases; however, many advocacy groups say the effect of the legislation would likely be much larger.
Tommy Thompson, president of NC20, a non-profit group fighting the insurance increases, says many people in the state are not aware of the full effects of the proposal. Thompson says the rate changes are likely to affect more than wealthy home renters, as the changes will trickle down to low- and moderate-income residents in the form of rent increases, the news source says.
The decision will fall into the hands of North Carolina Insurance Commissioner Wayne Goodwin, who has the sole power to approve or deny the rate, according to ENC Today. Goodwin says he has received the request and intends to listen to the opinions of his constituents before making a final decision.
Goodwin has scheduled a public discussion on the topic to be held on January 24. In addition, the commissioner will also accept written comments on the rate proposals until the end of the month.
The commissioner has yet to issue any comments about the proposals, though many expect his decision could be reached sometime in February.
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