North Carolina Insurance Commissioner Mike Causey has announced he has settled with the N.C. Rate Bureau for an overall average rate increase of 1.6 percent on personal auto insurance.
The NCRB, which is not a part of the Department of Insurance and represents insurance companies writing policies in North Carolina, had requested an average 7.6 percent increase in a Feb. 1 filing.
As part of the settlement, the NCRB has agreed not to seek a further increase in rates until 2021.
Actuaries at the Department of Insurance have calculated the difference. Consumers will save approximately $942 million with the 1.6 percent approved rate instead of the NCRB's requested increase.
Physical damage costs (comprehensive and collision insurance) will see a decrease of 9.1 percent. Liability insurance will see an increase of 11.3 percent, resulting in the average 1.6 percent increase.
"We were able to hold auto insurance rate increases to less than 2 percent, which consumers will hardly notice in their premiums," Commissioner Causey said, noting that distracted driving has gained momentum as a leading cause of accidents, putting an upward pressure on insurance rates.
"Getting motorists to focus on their driving and not get distracted while at the wheel would go a long way toward further holding down the cost of auto insurance," Commissioner Causey said.
To combat distracted driving, Commissioner Causey is backing House Bill 144, the Hands-Free NC Act, which would allow cell phone use by motorists with hands-free devices.
The new rates take effect Oct. 1.