Mike Causey, the Insurance Commissioner announced the new agreement with the North Carolina Rate Bureau in response to the Rate Bureau’s February request for a 13.8% increase in auto insurance rates.

State’s Department of Insurance agreed to a lower average increase of 2.2% - a savings of more than $1 billion for North Carolina consumers over two years.

"We are pleased that we were able to work out a settlement with the Rate Bureau that saved North Carolina consumers over a billion dollars," said Causey. "It is unfortunate rates have to increase at all. But accidents from distracted driving are up, there are more people on the road because of lower gas prices, and higher medical and automobile repair costs are forcing auto rate increases all across the country."

The new insurance rate goes into effect for new renewal policies beginning October 1st.

The Rate Bureau has agreed not to submit an auto rate filling in 2018, so this rate change will be in effect for two years until Oct. 1, 2019.

In 2016, deaths due to road accidents plunged to the highest level in nearly a decade. The number of deadly accidents increased to 7% in 2015 and was estimated to increase 6% in 2016.

The biggest new factors in auto rate increases are due to distracted driving. According to an article posted in Wall Street Journal, an insurance company said that it had raised 6.5% in 2015 and is expecting to raise this rates this year to 8% due to the impact of distracted driving.

"Recent data shows North Carolina has the seventh lowest average auto premiums in the nation," said Commissioner Causey. "Our decision to settle was based on the increase in traffic deaths and other safety factors while also maintaining competition for insurance companies and options for consumers. We'll continue to fight for lower, reasonable rates for consumers. Our number one job is to protect the consumer."

If the case had gone to hearing on September 11, this year and the Rate Bureau had lost, then by law, it would have been allowed to implement its 13.8% increase.

It would also have been allowed to continue making annual rate filing for the auto rate increase. Insurance consumers would have paid unwarranted higher rates for months and possibly years until the case was resolved by the courts.

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