North Carolina insurance officials faced a barrage of criticism on Monday during a public hearing on a proposal to increase homeowners insurance rates by an average of 42%. The extensive six-hour hearing, conducted by the N.C. Department of Insurance, drew numerous residents from across the state expressing their financial concerns and opposition to the proposed hikes.
Among the voices raised against the rate increases was Patrick O’Donnell, a town commissioner in Minnesott Beach, Pamlico County, who is actively working on a resolution to oppose the proposed hikes. O’Donnell emphasized the impact on those with fixed incomes in Pamlico County, stating that many residents would be priced out of their homes, potentially facing bankruptcy.
The proposed rate increases are not uniform across the state. Beach communities spanning from Carteret County to the South Carolina border could see their rates nearly double. Durham and Wake counties are facing a proposed 40% increase, while Chatham and Orange counties would experience a 25% increase. In some mountain counties like Haywood, Swain, Madison, and Transylvania, the proposed increase is comparatively lower at 4%.
Critics at the hearing pointed to the substantial salaries of insurance company CEOs, questioning the necessity of the proposed rate hikes. Mike McHugh of the Swansboro Area Chamber of Commerce expressed skepticism, suggesting that the directive for the increases originated in the boardrooms of major insurance companies.
Insurance Commissioner Mike Causey, who will ultimately decide whether to approve the proposed increases or negotiate a smaller rate hike, did not attend the hearing in person. This absence drew criticism from some speakers, though department staff led the hearing and documented the comments.
State Sen. Natasha Marcus, a Democrat running for insurance commissioner, emphasized the need for more scrutiny beyond the hearing. Marcus called for a comprehensive public hearing that includes evidence presented by insurance companies under oath regarding their profits, salaries, and claims in different regions of the state.
Despite his absence at the hearing, Causey released a video last week explaining the rate increase approval process and assuring residents that he is committed to fighting for lower rates. Causey highlighted his track record of reducing previous rate hike proposals through negotiations with insurance companies.
In 2021, insurance companies initially sought a 24.5% average increase in homeowners insurance rates, but after negotiations with Causey, the final approved increase averaged 7.9%. The current proposal, however, has sparked heightened concern and opposition from residents who fear the financial strain it could impose on homeowners across the state.
