Anyone who owns a vacation home or rental property may know the difference between a homeowner’s insurance policy and a dwelling policy. They are two distinct types of coverage, and N.C. Insurance Commissioner Mike Causey has successfully negotiated an agreement that provides for a rate increase of 8 percent for dwelling policies.
The Rate Bureau had requested a 50.6 percent increase, but as the head of what Causey calls a consumer advocate agency, it’s his job to keep an eye on the bottom line to make sure that people who want and need insurance have access to the best information to make decisions about coverage.
“My job is to protect consumers…to make sure they’re getting a fair shake and (insurance) companies are financially solvent so that they can pay claims when needed,” he said on Thursday’s TownTalk.
Although the rates vary across the state – higher rates in counties along the coast and lower in some of the western counties, Vance County’s rate is just over half of that 8 percent level, Causey said – 4.8 or 4.9 percent.
The new rates take effect on Nov. 1.
Renters need to remember, however, that a dwelling policy is for the structure; renters still need to consider renters’ insurance to protect their personal property against, loss, theft or damage.
Causey explained that, as insurance commissioner, he is only able to offer two responses to a Rate Bureau for a rate request: yes or no.
So far, in his 8 years, his answer has always been “no,” which puts the request on a path that involves going to court. The dwelling policy rate request had been scheduled for later this month, but it was canceled when an agreement was reached in May.
“I’ve beem criticized for not going to court,” Causey said, but court cases are expensive and those costs get passed along to taxpayers. The way he sees it, “getting as close to 0 as you can get – that’s much better than going through that court process.”
So far, a request for a homeowner’s insurance rate increase is still on for October. During the required public comment period, Causey said he received more than 25,000 comments – not surprisingly – asking that rates not go up.
“I heard the message loud and clear,” Causey said.
With his consumer advocacy hat on, Causey reminds current policy holders to review their coverage regularly, shop around and choose financially sound companies that will be able to pay claims.
Make sure you ask your insurance agent about deductibles and make sure you ask for replacement value coverage.
“If you don’t have replacement value coverage, you’re not going to be happy with your claim,” he said. Having this type of coverage may cost a few dollars more in premiums, he said, but “it’s worth its weight in gold.”
Oh, and don’t fall for TV and internet ads. Choose local agents with local companies, he said.
Email him at mike.causey@ncdoi.gov, visit www.complaint.ncdoi.gov to file a complaint or phone the department 855.408.1212.
“We’re here to help and that’s the message I want to get out,” Causey said.
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