N.C. Department of Insurance Commissioner Mike Causey was in Henderson Tuesday and spoke to a room full of local insurance agents, business leaders and others from the community about what’s going on in the industry.
The event, sponsored by the Henderson-Vance Chamber of Commerce, was held in the Farm Bureau Room of Perry Memorial Library, which Causey noted was a fitting location for the program. Following his remarks, Causey entertained questions from the audience.
Causey is seeking a third term as the state’s insurance commissioner; he faces two Republican challengers in the Mar. 5 primary.
At the top of everybody’s minds is the proposed 40-plus percent rate hike presented recently to Causey by the N.C. Rate Bureau.
Causey told the group that state law requires just one word from the insurance commissioner with regard to a proposed rate hike: yes or no.
Causey said he’s always answered “no,” which means the proposal goes before the courts for a determination. The Rate Bureau has to submit a lot of paperwork that includes payout totals for claims and amounts paid for premiums.
The period for public comment continues through Feb. 2; so far, Causey said his department has gotten about 10,000 comments, the vast majority of which are against the rate hike.
He said he must wait until the comment period has closed before making a statement about the proposed rate hike. He said that likely would come sometime between Feb. 2 and Feb. 22; a court date most likely would come in October.
“In fairness to the insurance companies, they have paid out a lot in claims,” Causey explained, citing dozens of recent natural disasters from wildfires to hurricanes. “We all pay for it, no matter where you live.”
The insurance department oversees more than just homeowners’ insurance, Causey said. The Smart NC program,for example, helps consumers who have disputes with doctors, hospitals and medical bills. “It’s done a lot to help people,” he said.
The department’s fraud control group mainly focuses on white collar crime and there are sworn officers – federally funded – who investigate Social Security fraud.
“I talk about fraud so much because we’re paying for it,” Causey said. The “we” in this case is everyone who pays insurance of any kind. He said that about 20 cents of every dollar spent on insurance is used to combat fraud.
In the world of insurance, the rule of thumb is that 1 in 10 claims will be unfounded or fake. But when it comes to health care fraud, that number jumps to more than 4 in 10, he said.
Anyone who suspects fraud can report anonymously to the Department of Insurance. It takes less than a minute to file a complaint online, he said. The department fields about 6,000 calls a year.
If investigators determine that the fraud is a civil, rather than criminal, matter, the department sends out a warning letter that lets folks know that what they’ve done is wrong and they’ve been put on notice to stop.
Causey said more than 200 letters have been sent, and not one person has been a repeat offender.
“Sometimes it just takes getting their attention,” he said.
Another program available through DOI is the Lost Life Insurance Locator, which does exactly what the name implies – it helps locate life insurance policies. People who want to know if their deceased relatives have any life insurance policies that they don’t know about need only submit a bit of demographic information to find the answer.
“If it was written within the state, we’ll find it,” Causey said.
So far, the program has found more than $300 million in life insurance. Last year alone, the figure was $66 million.
Causey has in his possession a policy from 1908 that is signed by the very first person to hold the office of insurance commissioner in North Carolina. That man was James Young, an insurance agent from right here in Henderson. He served for 22 years, from 1899 to 1921.
Visit www.ncdoi.gov to find out more.
Check out Tuesday’s TownTalk at wizs.com to hear an interview with Commissioner Causey that was aired at 11 a.m.