Reality Check: Insurance Rates Increase

Published MARCH 3, 2015

Homeowner insurance rates for some mountain residents are going up soon while rates on the coast are going down.

The insurance commissioner says data shows the mountains saw more claims while the coast saw fewer and deserved a break.

Property owners on the coast typically pay higher homeowner insurance rates, where the risk of water and wind damage is much greater.
But in the mountains, homeowners are surprised rates are declining on the coast, but rising here.

“Last year my homeowners insurance went up from $800 to $1,200 without an increase in coverage,” homeowner Anne Doherty said.

Doherty says she can’t understand why her insurance could go even higher.

“Now we’re already paying pretty high rates and I don’t think that’s fair,” Doherty said.

While the insurance commission says rates across the state on average will remain about the same, that doesn’t mean people living in the mountains won’t be paying more.

Last year, insurance companies sought to raise everyone’s homeowners rate as much as 35 percent, but the Department of Insurance Commissioner rejected the proposal and settled on rates that go down as much as 18 percent on the coast and up as much as 21 percent in the west where homeowners insurance is still much cheaper.

She says the opposite is true for the mountains which has experienced more claims for wind, hail and ice events.

“So, what you’re doing is looking at the claims made across the population,” Kerry Hall, Director of Public Information at the North Carolina Department of Insurance said.

Base rates in the mountains are still below the state average; home valued at $150,000 would cost $2,259 to insure on the outer banks. That same home in the mountains would cost $540.

Mike Beard, a AAA insurance consultant, says the best way to save is to shop for discounts.

“When we write your auto and homeowners together, you get a bundle on both policies and that discount can sometimes save you hundreds of dollars a year,” Beard said.

The new homeowner insurance rates take effect in June, but the insurance companies are appealing the rate adjustment.