BELOW IS AN EXCERPT OF THE OFFICIAL PRESS RELEASE FROM THE INSURANCE COMMISIONER'S OFFICE.  HAYWOOD COUNTY IS IN TERRITORY 380 AND WE WILL SEE A 16.6 % INCREASE SOMETIME IN 2015.


Commissioner Wayne Goodwin has ordered a zero percent statewide overall average change in homeowners insurance rates, effective June 1, 2015. The ordered rates vary by geographic territory and type of insurance. On average, homeowners insurance rates are to decrease by 0.3 percent, renter’s insurance rates are to increase by 11.2 percent, and condo owner’s insurance rates are to increase by 8.1 percent.    

The decision comes after Goodwin held a hearing to examine the insurance companies’ request to raise overall average rates by 25.6 percent. During the hearing, experts from the N.C. Rate Bureau, on behalf of the insurance companies, and experts from the N.C. Department of Insurance, representing the interests of the public, presented their cases for and against the rate hikes. It was the first hearing on homeowners insurance rates since 1992.

“The rates I have ordered are the result of the most thorough inspection of North Carolina homeowners insurance rates in more than 20 years,” said Goodwin. “After considering all of the evidence and data available, I have determined that no factors or events justified the excessive rates requested by the insurance companies.”

Read the full order here: http://www.ncdoi.com/Media/Documents/12-19-14_HO_Order_Total.pdf

.2014 Homeowners Insurance Timeline

Jan. 3, 2014: The North Carolina Rate Bureau files a request with NCDOI to raise homeowners insurance rates.

Jan. 3-31, 2014: A public comment period is held on the rate filing. NCDOI receives more than 10,000 mailed or emailed comments, and approximately 25 people comment in-person.

Feb. 19, 2014: Goodwin calls for a hearing on the rate request.

Oct. 20- Nov. 12, 2014: Goodwin conducts hearing on 12 days.

Dec. 18, 2014: Goodwin orders an overall average rate change of zero percent, effective June 1, 2015.

What is NETS?  It stands for Noncomplaint Employer Targeting System.  This is a new intelligent system used by the North Carolina Industrial Commission (NCIC) to identify employers that are potentially violating the statutory requirement to provide workers’ compensation benefits to their employees.  It uses data available from the Government Data Analytics Center to produce a list of potentially noncompliant employers.  At the end of July 2014, NETS produced a list of 4,166 potential noncompliant employers and 600 cases were investigated and closed.

How does this affect you as an employer?  Serious penalties can be accessed retroactively for the time period out of compliance and if serious enough a cease and desist order can be enforced that effectively puts an employer out of business.

One of the most abused violations is in the definition of an independent contractor vs. an employee. The NCIC defines an employee by “exercise and degree of control” that en employer asserts over that person or persons.  Basically, if the person working for an employer derives most of their livelihood from that employer and does not have a separate business license or separate customers to perform work for then that person is probably NOT an independent contractor.  Also, if the business is a corporation then the total of three employees applies but the corporate officers are counted in that number even if they elect to reject coverage.  The rules are different for and LLC or sole proprietor type of business.

The assessed penalties for Fiscal Year 2013-2014 were $5,223,302 which was an increase of $143% over the previous year.

Don’t take a chance and get caught trying to define your employee using IRS or other guidelines as related to independent contractors.  Merely giving someone a 1099 Form is not protection from the law and can result in serious consequences for you and your business!

Wonder why your North Carolina homeowner insurance policy is going up? According to A.M. Best, an industry rating service, only 4 years out of 20 has been profitable in the homeowner lines of business countrywide. Also, North Carolina is the only state from all adjoining states around us that has not taken a rate increase of at last 18% or more since 2011. There was, however, a general homeowner rate increase in July of 2014. Making matters worse is the down turn in the housing market creating a glut of vacant homes in a market that is very restrictive amid arguably inadequate rates that have been held down for many years by the former and current commissioner of insurance. As if it could not get much worse the N.C. Legislators in their infinite wisdom allowed a concept called "Consent to Rate" that allows an insurance company to charge up to 250% higher than the highest rate allowed by the N.C. Rate Bureau on a case by case basis. The original intent was to rate up only those accounts that warranted this action due to claims, poor credit history, or monoline homes with no supporting auto policy, or any other reason as defined by the insurance companies. The requirement of the insured to sign the CTR letter, or else the policy must be cancelled by statute, is disconcerting to agents and customers and is now being abused by insurance companies to get a higher rate across the board if they wish to take that drastic step. The letter must only be signed once by the customer and some insurance companies are doing this now for both new and renewal policies on an "if needed" basis.

Your only option to lower your insurance premium is to get with your insurance agent to discuss higher deductibles, review the current replacement cost of the house, be sure you are getting all available discounts, or re-score your credit (both husband and/or wife) per the insurance company’s scoring model algorithm.

My advise is to find a good independent insurance agent that has your best interest in mind vs. a company captive agent that only represents one insurance company. Remember the old adage...don't bite the hand that feeds you? That is how a captive agent works since there is little incentive to go to bat for the customer and their options are limited to their own insurance company and their requirements.