It's not often a letter in the mail makes you mad, but when you receive one that gives you an ultimatum about your money...yeah that can raise the blood pressure.
2 Wants To Know heard from some consumers who are are angry-- very angry, because their insurance companies are giving them an ultimatum.
Customers are being told by their insurance company to say yes to a raise in their homeowner's rates or be dropped. As if that is not enough, the rates are over and above what the North Carolina rate bureau put in place.
You would think that practice is illegal since it goes against a rate the state set. But the practice is legal and happening more and more with insurance companies. Our Call for Action team got several calls about the ultimatum. The state insurance commissioner, Wayne Goodwin, is getting plenty of calls too. Not only from you-- but also from 2 Wants To Know. We asked why they can't stop the ultimatum.
"It's certainly frustrating if you get a letter like this," Goodwin said.
Goodwin adds the maximum rate is really just a guideline since insurance companies aren't required to provide you coverage. He says North Carolina lawmakers tend to stay away from regulations.
"There are very limited instances when laws impair contracts between parties."
And know this, if you do give permission for this increase, you also give your insurance company permission to keep raising your rates every year. How much? State law allows companies to raise rates by 250 percent. No. That is not a type - 250 percent.
The insurance commissioner says companies often ask to raise rates if an individual files a lot of claims or has a special circumstance - like living in a newly determined flood zone. So if you get a letter, call and ask why. The company might have mus-information, and hopefully you can avoid the higher premiums.
To shop around for the best price, check out the links on Goodwin's consumer page.