Well folks, I’ve got some unfortunate news to share today. Auto insurance rates are heading upward here in North Carolina. I’ll fill you in on when the increases are happening, why they’re occurring, who will be most impacted, and importantly – what you can do to minimize the rate hike pain.
When Are the Rate Hikes Happening?
First off, when can we expect to start paying more? A recent settlement between insurance companies and state regulators means NC drivers have already seen a 4.5% rate increase that hit policies starting December 1, 2022.
Now, the second increase of 4.5% will take effect this coming December 1, 2023. Additionally, motorcycle liability coverage rose 2.3% on December 1, 2022 and will rise another 2.3% on December 1, 2023.
Why Are Insurance Rates Increasing?
You’re probably wondering – why are we facing these rate hikes yet again? Well, the insurance industry says several nationwide factors are driving costs upward. Increased vehicle repair costs, rising car prices, and a jump in accident frequency are all squeezing insurer profits. As a result, they claim the need to raise premiums to maintain sufficient funds to cover future claims.
Initially, the North Carolina Rate Bureau requested approval for a whopping 28.4% rate increase! Fortunately, state regulators were able to negotiate the hike down to 9% over two years. Still, any increase stings our wallets as drivers.
Who Will the Rate Hikes Impact the Most?
When it comes to who will feel the brunt of the rate hikes, drivers with recent accidents, tickets, or infractions on their records should brace for the largest increases. Young motorists will likely take a significant hit too. And those insuring newer model vehicles may see steeper premium bumps comparative to older cars.
How to Minimize the Rate Increase Impact
Now let’s talk about what you can do to minimize the impact of these rate increases. Here are some smart tips to consider:
- Shop around rigorously prior to your policy renewal date: Comparing quotes from multiple insurers could reveal substantial savings if you switch providers. Locking in a competitive rate now can potentially delay the hike.
- Inquire extensively about discounts you may qualify for: Many exist for things like bundling policies, paying annually, taking defensive driver courses, maintaining good grades, and more. Any discount helps offset the increase.
- Review your policy details with a fine-tooth comb: Are there coverages you can drop or deductibles you can raise to lower your costs? Removing unneeded extras like roadside assistance and rental car coverage is one option.
- Keep your credit score high and your driving record clean: Insurers rely heavily on these factors in pricing. Obeying traffic laws, avoiding accidents, and maintaining good credit will benefit you greatly when rates rise.
Even after these increases, North Carolina will still boast some of the lowest auto insurance rates in the entire country. And the NC Rate Bureau claims they don’t anticipate filing for any additional hikes until at least October 1, 2025. So there should be a multi-year break from increases after the next two phases.
Conclusion
I know it’s frustrating to see our insurance costs continue rising while our paychecks stay flat. But hopefully these tips will help you proactively minimize the rate hike pain here in North Carolina. Let me know if you have any other questions!
