High Risk for Auto InsuranceIn North Carolina, you are required by law to carry auto liability insurance on any vehicle that you own/operate, but what if your driving record is tarnished with a history of several accidents? While nobody can be turned down for auto insurance coverage, (exceptions apply) your insurance carrier CAN decide to turn your policy over to the North Carolina Reinsurance Facility (NCRF). If you fail to pay your insurance premium or no longer have a valid drivers license, you can be turned away for coverage. If you receive notification, you will need to know what it means when your N.C. auto liability insurance is ceded.

How Does NCRF Operate?

Developed in 1973, the North Carolina Reinsurance Facility is designed to insure high-risk drivers when the insurance company has decided that particular insured is a risk they no longer wish to carry. The rates for high-risk drivers through NCRF are typically 35% higher than the voluntary market and include as many as 25% of N.C. drivers.

When an insurance company decides to “cede” an insurance policy to the organization (NCRF), the risk is then distributed among all the member insurers (over 450 auto insurance carriers are members) to absorb the expenses and losses that are ceded. Once your policy has been ceded or “passed on” with the NCRF, it doesn’t mean you will remain in the Facility forever. You can spend the next 2 years working to improve your current driving record in an effort to make you qualified to return to the voluntary market and hence, reduce your insurance premium.

Keep in mind that auto coverage for Comprehensive/Collision is not normally accepted by the NCRF, so you will need to seek an insurer who specializes in “non-standard” insurance. Since non-standard insurance is written for high-risk drivers, you will pay a higher insurance rate for this coverage.

Your N.C. Independent Insurance Agent Can Assist

You can contact your local N.C. independent insurance agent with any questions you may have regarding high-risk insurance and they can provide answers regarding available coverage options and premium rates. If you find that your current N.C. auto insurance policy has been ceded to the NCRF, it may be wise to contact us at Paramount Insurance Agency to allow us to shop around for available rates through multiple insurance companies to find an acceptable insurance coverage and rate. Some companies may be more readily apt to turn your policy over to the Facility than others. Give us a call at 866-869-3335 with any questions you may have regarding your N.C. auto insurance.