A BILL TO BE ENTITLED
AN ACT to impose A temporary stay on increased surcharges and deductibles under the Beach Plan and the fair plan and to temporarily stay property insurance rate increases for homeowners policies across the State.
Whereas, the economy of the State is in historic decline, as evidenced by the projected $2.2 billion shortfall in revenue for the 2009‑2010 fiscal year; and
Whereas, the unemployment rate for December 2008 by the Employment Security Commission was 8.7%, an increase of 85% over the rate in December 2007; and
Whereas, over 53,995 homes in North Carolina entered foreclosure in 2008, and an additional 2,221 homes entered foreclosure in January 2009; and 
Whereas, the homeowners insurance rate increase approved by the Department of Insurance in December 2008 and scheduled to take effect in May 2009 increases rates by 22% in portions of Currituck, Hyde, Dare, and Pamlico Counties and increases rates by 29.8% in portions of Brunswick, New Hanover, Onslow, and Pender Counties; and
Whereas, over the last six years, the Department of Insurance estimates that homeowners insurance rates in the Beach Plan beach area have increased 90%, and rates in the Beach Plan coastal area have increased 65%; and
Whereas, seven of the counties included in the Beach Plan's beach and coastal areas are classified by the Department of Commerce as Tier One counties, meaning that they are among the 40 most economically distressed counties in the State and are eligible for the highest level of economic development incentives; and
Whereas, nine of the counties included in the Beach Plan's beach and coastal areas have poverty rates above the statewide average and median family income below the statewide average, according to U.S. Census Bureau 2007 estimates; and 
Whereas, 57% of properties insured by the Beach Plan have an insured value for building and contents of $300,000 or less; and
Whereas, the citizens of North Carolina who are struggling to hold onto their homes and jobs should not be required to pay higher insurance rates during this economic crisis; Now, therefore,
The General Assembly of North Carolina enacts:
SECTION 1.  The filing by the North Carolina Insurance Underwriting Association (NCIUA) approved by the Department of Insurance on November 21, 2008, and designated by the Department as PC121215 increasing from fifteen percent (15%) to twenty‑five percent (25%) the factor or surcharge for homeowners coverage shall not take effect. 
SECTION 2.  The filing by the NCIUA approved by the Department on November 21, 2008, and designated by the Department as PC122445 increasing from five percent (5%) to fifteen percent (15%) the factor or surcharge for homeowners windstorm and hail only coverage shall not take effect.
SECTION 3.  The residential deductible guideline submitted by the NCIUA, approved by the Department on November 21, 2008, and designated by the Department as PC122635 shall not take effect. 
SECTION 4.  The residential deductible guideline submitted by the North Carolina Joint Underwriting Association (NCJUA), approved by the Department on November 21, 2008, and designated by the Department as PC122682 shall not take effect.
SECTION 5.  The commercial deductible guideline submitted by the NCIUA, approved by the Department on November 21, 2008, and designated by the Department as PC122637 shall not take effect.
SECTION 6.  The commercial deductible guideline submitted by the NCJUA, approved by the Department on November 21, 2008, and designated by the Department as PC122683 shall not take effect.  
SECTION 7.  There shall be no surcharge or deductible increases or changes for coverages as specified in Sections 1 through 6 of this act on or after the effective date of this act.
SECTION 8.  Rate increases resulting from the 2008 Rate Filing approved by the Commissioner of Insurance in the Consolidated Settlement Agreement and Consent Order dated December 18, 2008, shall not take effect, nor shall these rate increases be used by the NCIUA or the NCJUA when determining rates for coverage. In addition, there shall be no rate increases for coverage as specified in this section subsequent to the effective date of this act.
SECTION 9.  Premiums or deductibles paid in violation of this act shall be refunded by insurers, the NCIUA, and the NCJUA, as applicable. 
SECTION 10.  Sections 1 through 9 of this act are effective when they become law and apply to policies issued or renewed on or after that date. The remainder of this act is effective when it becomes law. This act expires July 1, 2010.