Homeowners insurance rates are slated to increase in the tri-county area next year.
The increase of 9.8% in some parts of New Hanover, Pender and Brunswick counties is more than twice the state average of 4%. The rate hike is set to take effect on new and renewed policies beginning on or after May 1, 2020, according to an N.C. Department of Insurance news release.
The 9.8% rate for beach areas in the region and eastern coastal New Hanover, Pender and Brunswick counties is the highest rate increase in the state. In western parts of the tri-county area, the rate increase is 3.5%. The rates are varied and broken down by postal zip code
The rates are the result of a settlement in a legal dispute with the N.C. Rate Bureau. The N.C. Rate Bureau (NCRB) represents companies writing property insurance in the state and is not a part of the state department of insurance.
In 2018, the NCRB proposed a 17.4% statewide overall increase in homeowners insurance rates.
"Compared to the rates requested by the NCRB, the settlement means a significant savings for homeowners," stated a release. "For example, Wilmington residents with a $200,000 frame home with a $1,000 deductible would pay an average $400 less a year than had the NCRB's requested rates gone into effect."
The customer savings, however, is on top of a rate that is already higher than the same type of coverage in the middle of the state, said Tyler Newman, president and CEO for Business Alliance for a Sound Economy, a nonprofit business advocacy group that focuses on New Hanover, Pender, Brunswick and Onslow counties.
"It is frustrating because the overall ratemaking system in North Carolina is broken—and these incremental increases only make it more inequitable," Newman said in an email.
On top of the increase, Newman also mentioned that local homeowners have additional wind and flood policies.
"And while this homeowners case may be settled, there is still another dwelling/fire/extended coverage (wind) rate case that is pending, which asks for a 30% increase on those policies. Unfortunately, this won’t stop until the legislature steps in and changes our state’s unique ratemaking structure," he said.
That increase request took place Aug. 14, according to officials with the N.C. Department of Insurance.
The NCRB requested a statewide average rate increase of 19.2%, with a requested effective date of July 1. The increases vary by territory.
"The filing includes a requested increase of 24.3% in extended (wind) coverage and an increase of 4.6% in fire coverage," stated a release. "The proposed rate increases are capped by territory at 30% for extended coverage and 5% for fire coverage."