The cost of property insurance is a major issue in our region. As an insurance agent, I have fought for years with insurance companies, the Beach Plan, the Commissioner of Insurance, and members of the Legislature to keep rates fair and affordable. I have found the insurance issues to be complicated and that there are no easy answers.
The biggest problem we have is that insurance companies have had high property losses in North Carolina and the eastern part of North Carolina, with its low number of voters, is an easy target in the legislature. If you base rates on past losses and not speculation, you will find the real need for rate increases is in the central and western part of the state. For the past several years, even after Irene, northeastern North Carolina has shown positive loss ratios. The storms usually move quickly over our area and then stall northwest of us, our pine trees have a root system that makes them less likely to blow over than the oaks that are in the central part of the state, and our building codes are more stringent than the rest of the state. While we certainly have had some serious flooding recently, the people in Raleigh don't appear to understand that flood insurance is a Federal program that in no way affects property rates.
There is a definite need for rate reform but we need to be very careful and deliberate how we go about it so that we don't make things worse. Our system works very well with automobile insurance, for example. We have some of the lowest rates in the southeast United States and the companies continue to make a profit which keeps private competition in the market. The same system applied to homeowners, however, has caused the market of last resort to become the primary market in the east, very few companies writing east of US Highway 95, and a rate in the northeast that makes it increasingly difficult to live and work in this area.
As I stated in the beginning, the resolution to this problem won't be easy, but when I am elected, I will work with the legislature, the insurance companies, and the communities to make sure we have rates that allow our economy to grow.