N.C. Falls to Fifth Lowest Auto Insurance Rates in Nation
Insurance Commissioner Jim Long has announced in Raleigh, N.C. that the state now ranks as having the fifth lowest auto insurance rates in the nation, an improvement of three places over last year’s ranking as the eighth lowest. States bordering North Carolina rank as follows: Tennessee, 11th; Virginia, 13th; South Carolina, 26th; and Georgia, 27th.
The rankings are obtained from a report by the National Association of Insurance Commissioners (NAIC) which compares the costs of personal automobile insurance in all 50 states and the District of Columbia, based on 2003 data.
Long opened hearings Monday to determine the rates for the coming year. The hearings are expected to last up to five weeks.
“North Carolina is one of the few remaining states to allow the insurance commissioner to set rates for auto and homeowners insurance,” said Long, who has seen the state’s ranking steadily improve over his 21 years in office. “Most states have to accept rate increases from each individual company. Here in North Carolina, all companies file together for a standard rate, and I have the authority to approve or disapprove that rate after carefully reviewing the data and going to a hearing if need be. If I find a rate increase to be unreasonable, I can deny it, and often set rates that are even lower and more affordable for North Carolina drivers.”
Rate decreases have in fact been ordered by Long in 10 of the last 20 rate requests. In five other years, the commissioner decided upon a zero percent change in rates, keeping them level instead of allowing an increase.
“Through intense negotiations and sometimes through court orders, I have saved North Carolinians an estimated $3.2 billion in potential premiums,” Long said.
The 2005 auto rate filing from the North Carolina Rate Bureau, which represents the insurance companies, requested an 11.5 percent increase in rates, later reduced to a 9.6 percent requested increase. Because the Department of Insurance and the Bureau could not negotiate a settlement in this case, the hearing to determine the rate begins today, with Long serving as the hearing officer.
North Carolina continues to be the most populous state to enjoy a spot in the top 10 lowest states to rank in the NAIC’s report. Other states with low auto insurance rates have a significantly less dense population than North Carolina, which contributes to their lower rates.