1 Million to Get Insurance Refund: Auto Rates Will Fall and Be Frozen Until 2011, Thanks to an Out-of- Court Settlement.

 

Friday, Jul 17,2009, 10:34:35 AM   Click:

Here is a rare glimmer of hope for consumers: An estimated 1 million motor insurance policies throughout the state are owed more than $ 50 million in reimbursements.

And there is more good news: Auto insurers this year will slightly reduce the rates, prior to their request for a rate hike. And the freezing of premiums until at least 2011.

That is the bottom line of an agreement announced Wednesday between the Insurance Commissioner Wayne Goodwin and the NC Rate Bureau, which represents 144 auto insurers.

The path to the latest auto insurance rates followed a familiar pattern: Insurers request a rate hike.

The Insurance Commissioner rejects the request and orders a lower rate.

The dispute ends up in court. The two sides settle out of court.

"This settlement is a great deal and is terrific news for North Carolina consumers," said Goodwin, who noted that the settlement makes premiums slightly lower than they were in 2006.

A policyholder in Raleigh who is an experienced driver, has no points on his license and owns a 2008 Taurus could save $92 a year compared to the rate hike sought by insurers, according to the Insurance Department.

A typical policyholder in Durham could save $102 annually. The new rates take effect Nov. 1 but are retroactive to Jan. 1, which triggers the refund for some motorists.