View letter sent by Mayor Eddie Barber on behalf of the Town of Emerald Isle.
The NC Rate Bureau, the entity representing NC insurance companies, has filed for ANOTHER significant rate increase for homeowners insurance (including wind and hail) in coastal North Carolina, including Emerald Isle. The NC Rate Bureau is now seeking a 25% increase in homeowners insurance rates for barrier islands, including Emerald Isle, and this latest request follows significant increases in 2005 (15% approved), 2007 (25% approved), 2009 (17.5% approved), and 2013 (19.8% approved), and a slight decrease in 2015 (5.6% decrease approved after a 35% increase was requested). Rate increases of 40% have also been requested for tenants (renters) and condominium unit owners in 2017.
The cumulative effect of the previously approved increases equates to a 91% increase from the 2005 approved rates to the 2015 approved rates. If the current request is approved, the cumulative effect would equate to a 138% increase from the 2005 rates to the requested 2017 rates. More notable, homeowners in Emerald Isle (and other barrier island communities) already pay the highest base rates for homeowners insurance in the entire State of North Carolina, with base rates as much as 4 - 5 times higher than many other areas. If the 2017 request is approved, Emerald Isle's (and many other barrier island communities') rates will be nearly 6 times higher than some other areas of North Carolina.
The current base rate in Emerald Isle (the rate before various adjustments, deductions, and credits are applied by your insurance company) for $200,000 worth of coverage is $2,648 per year, and this rate is proposed to increase to $3,310 per year in 2018! This represents an increase of $662 per year, and this increase alone is more than the average annual Town property tax bill in Emerald Isle. It is also important to note that many homes in Emerald Isle have more than $200,0000 worth of coverage, thus the more coverage, the more significant the increase. The 2018 request, if approved, is likely to result in a $500 - $1,500 increase annually in the cost of homeowners insurance for Emerald Isle homeowners. For comparison, homeowners in Orange County currently pay $576, and the proposed base rate would increase to $669 annually. Homeowners in some western areas of North Carolina currently pay a base rate of $553, and this rate would increase to $578.
The 2017 request will be considered by the NC Department of Insurance in the coming weeks, and now is the time to submit your comments to the NC Department of Insurance if you are concerned about this issue! Public comments are due by December 29.
The Town of Emerald Isle is concerned about this issue, has expressed its opposition several times in recent years, and will submit formal comments to the NC Department of Insurance next week. If this issue is important to you, please consider submitting your own comments by sending an email to 2017HomeInsurance@ncdoi.gov before the December 29 deadline. A sample letter is presented below for you to cut and paste if desired:
Dear Commissioner Causey, c/o Ms. Tricia Ford:
I am writing to you as a homeowner in Emerald Isle to request that you completely reject the requested 25% increase in base rates (40% for tenants and condominium unit owners) for Territory #120, and that you also work toward a fairer rate structure for homeowners insurance in coastal North Carolina.
The requested 25% rate increase follows four previous significant rate increases since 2005 that increased rates by 91%, and if the 2017 increase is implemented, the rates will have increased by 138% since that time. Homeowners in Emerald Isle (and the rest of Territory #120) already pay the highest base rates in the entire State. Current base rates are already 4 - 5 times higher than many other areas of North Carolina, and the requested 25% increase will only increase this disparity further, with rates nearly 6 times higher than some other areas in North Carolina. If the proposed rate increase is approved, it will likely add up to $1,000 of additional annual cost for the typical policy holder.
This repeated pattern of significant rate increases represents a significant financial burden for homeowners, and this burden has a negative impact on family budgets, the regional tourism industry, and the local real estate market. These increases are unfair and unreasonable. We implore you to re-examine the entire rate structure for homeowners insurance policies in North Carolina, and work to narrow the disparity in costs between coastal areas and inland areas. As coastal residents, we certainly recognize the risk of hurricane damage and expect to pay higher premiums than inland areas, however, rates that are 4, 5, and 6 times higher than other areas of the State are simply unfair. Additionally, recent experience in North Carolina suggests that current premiums are more than adequate to meet actual and expected claims.
Thank you for your concern and attention to this issue.
To view a comparison of current and proposed base rates by area, please see the attached.
To view the entire requested rate increase filing, please click here.