North Carolina Insurance Commissioner Jim Long has advised the Federal Reserve Bank of Richmond, Va., of the potential for up to $700 million in auto rate refund checks being distributed to North Carolinians in the coming months.
Long said he did not expect any disruptions to the banking system but felt it prudent to alert the agency to the possibility of increased banking activity, thanks to the expected widespread distribution of refund checks to North Carolina drivers.
The refunds come as a result of the conclusion of two contested auto rate cases from 2001 and 2002. The 2001 case, worth in excess of $400 million in potential refunds to drivers, was appealed by the insurance industry during a lengthy process that saw the case all the way to the North Carolina Supreme Court. The Court ruled in favor of Long, who originally ordered a 13 percent decrease in rates for 2001.
The 2002 case, which was also appealed, was settled after the ruling on the 2001 case. The 2002 case was worth more than $200 million in potential savings, after Long ordered an 11.6 percent decrease in rates. Refunds checks begin going out in October and will all be distributed by the end of November.
“We expect many people will receive checks, but not everybody,” Long said. “To those who don’t get refunds, don’t be disappointed. This just means you weren’t paying too much all along.”
Citizens with questions about refund checks should contact their auto insurance agents.
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