N.C. Moves to 8th Lowest Auto Rates in Nation

October 1, 2004

A report released by the National Association of Insurance Commissioners comparing auto insurance rates in all 50 states and the District of Columbia found that North Carolina ranks eighth in the nation for the lowest rates. This is an improvement over the ninth-lowest ranking previously held by the state.

Insurance Commissioner Jim Long, who is charged with setting rates for drivers, was reportedly pleased with the distinction, but not surprised.

“I have been fighting for low rates for the past 19 years, and North Carolinians have been enjoying the lowest rates in the Southeast for some time now,” he said. “It is encouraging and exciting to find that we are only getting better. All that hard work for our citizens has truly paid off.

“The funny thing about this report, though, is that the data used to determine this ranking is from 2002. That doesn’t even reflect the recent settlements we reached with the insurance companies, potentially refunding up to $700 million in overpayments from 2001 and 2002!”

Residents who overpaid on their insurance rates in 2001 and 2002 are due to see refund checks into next month. The refunds come as a result of the North Carolina Supreme Court ruling in favor of Long in the 2001 rate case, in which the North Carolina Rate Bureau, which represents all auto insurance companies in the state, appealed Long’s ruling to lower rates by 13 percent in 2001. The 2002 case, which was also appealed, was settled after the 2001 case decision came down.

The NAIC’s report, The Auto Insurance Database Report, compares average expenditures and annual premiums for auto insurance in all 50 states and the District of Columbia.

The top 10 states with the lowest auto insurance rates are as follows:

1. North Dakota*

2. South Dakota*

3. Iowa*

4. Idaho*

5. Wyoming*

6. Maine*

7. Kansas

8. North Carolina

9. Nebraska

10. Wisconsin

(States with an asterisk indicate no change in ranking)

States bordering North Carolina rank as follows: Virginia — 11th, Tennessee — 14th, South Carolina — 26th, Georgia — 30th.

North Carolina has the highest population density of any of the top-10 states compared in the report, and is the 17th highest in the country according to 2000 Census data. Generally, states with fewer people per square mile of land area are considered cheaper places to insure a vehicle because fewer wrecks typically occur.

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