North Carolina Deal Clears Way for Average 2% Auto Insurance Rate Hike
North Carolina’s insurance regulator says he’s reached a deal with auto insurers for a premium increase of just over 2 percent instead of the nearly 14 percent average increase companies sought in February.
The state Insurance Department said Thursday the new rates will become effective with policies signed after October 1 and will stay in effect for two years.
Insurance Commissioner Mike Causey says the agreed average increase of 2.2 percent meant North Carolina consumers would spend more than $1 billion less over two years than the auto insurance companies initially wanted.
Causey said in March the proposed auto insurance rate increase requested by a group representing the industry was not justified. That set up an administrative hearing planned for September, when a hearing officer could listen to both sides.
Delaware House Approves Auto Insurance Reform Measure
The state House has approved legislation restricting the factors that insurers can use in setting automobile insurance rates.
The bill, a watered-down version of legislation that had stalled in committee amid opposition from industry groups, was approved Thursday on a 24-14 vote. It now goes to the Senate.
The original bill prohibited the use of age, marital status, credit scores and income in setting auto insurance premiums. Instead, insurers would have to set rates based on a driver’s claims experience, safety record, number of miles driven annually, and years of driving experience.
The revised measure establishes permissible uses of credit information in setting rates. It also prohibits companies from increasing rates simply because a customer is 75 or older or because a spouse’s death causes a change in marital status.
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