Tom's Blog
You may have received a letter from your insurance company if you are a North Carolina Homeowners Insurance policyholder and if you did, do you know what it means? Many homeowners are receiving this letter and you need to understand why you received it and what it means to you, as a N.C. homeowner. Keep in mind that this letter is a consent to rate letter and is hugely foretelling of what’s to come. Have you received a consent to rate letter?
Hold On Before You Sign on the Dotted Line
Consent to rate letters are being sent out by insurance companies in large numbers to N.C. policyholders, but before you sign on the dotted line and mail it back, you should know a few things. First of all, the N.C. Insurance Commissioner’s office approves rates for homeowners and auto insurance policies for the state and determines the maximum allowed rates for both. From that, the N.C. insurance companies set the “state rates” they will charge their policyholders, based on the permitted rates that have been established.
The N.C. Commissioners office approves your initial charged premium rates for your auto and homeowners, but that consent to rate letter you received is a game changer. If you sign this form, you are agreeing to pay a higher rate for your insurance (auto and homeowners) than what is considered the maximum state rate.
What Does It Mean If You Receive a Consent to Rate Letter?
First of all, your insurance company is allowed to send this letter without any legal consequence, but it’s never a good thing to be the recipient of this type of letter, but of course the choice is yours to decline. However, declining to sign it may negatively impact your current standing with your insurance carrier.
If you do indeed receive a consent to rate letter it could mean one of two things. It could mean that you are one of MANY receiving it due to the bigger picture of “risk” that the conglomerate of homeowners in your area pose OR it could mean you are being singled out as a risk your insurance carrier may not wish to accept any longer at the current rate you have been paying. Therefore, they are asking you to consent to rates that are higher than the state maximum in order for you stay with them as a policyholder.
What You Should Do If You Receive a Consent to Rate Letter
If you are the recipient of a consent to rate letter, this may be the time to rethink your insurance coverage with another N.C. insurance company, especially due to the fierce competition out there. We, at Paramount Insurance Agency, are expert North Carolina independent insurance agents in your area and specialize in consent to rate forms. We can assist you with all of your questions you may have regarding this letter and can recommend a plan of action for your insurance protection by shopping for the best coverage for your auto and homeowners insurance at an affordable cost to you. Call us TODAY at 866-869-3335!
