Homeowner's insurance rising as much as 9.7 percent in Cape Fear region

Homeowners in Cumberland County and parts of the Cape Fear region will see larger insurance rate increases than much of the rest of the state starting this summer.

Insurance companies and the state's insurance commissioner, Wayne Goodwin, have agreed in a settlement that rates can rise by a statewide average of 7 percent starting in July.

But in Cumberland County, rates will increase 8.5 percent.

For a frame house valued at $150,000, a typical policy could rise from $850 a year to $922.

Robeson, Bladen and Columbus counties will see a substantial increase - 9.7 percent.

A typical policy in those counties could rise from $1,059 to $1,162.

Sampson County's rates could rise 7.4 percent.

For homeowners in Harnett, Hoke, Lee, Moore and Scotland counties, rate hikes of 6.8 percent could be on the way.

Kerry Hall, spokeswoman for the Department of Insurance, said the rate increases are based on several factors.

"Hurricanes are the driving factor," she said. "But a lot of it has to do with the claims experience of that territory."

Hall said insurers looked at the claims history of each part of the state using data from through 2010. That means the new rates do not factor in tornadoes and other severe weather the region has had in recent years.

The North Carolina Rate Bureau, which represents the insurance companies, had requested a much higher overall statewide average rate increase of 17.7 percent on Oct. 1, 2012.

Instead, officials agreed to a settlement Tuesday with the lower rates.

"The difference between the requested and settled rates amounts to $237 million in savings to policyholders," according to a news release.

Some increase was justified, officials said, because of the steadily rising cost of reinsurance related to hurricane risks and ongoing concerns about availability.

"Homeowners insurance is a very complex issue," Goodwin said in the release. "We face a great challenge in making sure that it is not only affordable but available to consumers across the state. I feel this settlement helps strike that balance, and I am pleased that the increase will be significantly smaller than what insurers originally requested."

The original proposed increase for Cumberland County homeowners was 25.8 percent. All region counties were facing more than 20 percent increases.

Before the settlement, the last homeowners insurance rate filing was in 2008, officials said. At that time, insurance companies requested a 19.5 percent statewide average increase. A settlement allowed for a 4.05 percent statewide average increase to go into effect in May 2009.

The smallest increases this year are in Winston-Salem and Greensboro, where homeowners will see a 1.1 percent increase. The largest increases are along the coast in Brunswick, Carteret, New Hanover, Onslow and Pender counties, which will see a 19.8 percent increase.

The Associated Press contributed to this report.