A BILL TO BE ENTITLED
AN ACT modifying the consent and notification requirements for insurance rate deviations, Prohibiting the Use of credit scoring to rate noncommercial private passenger motor vehicle and residential property insurance, directing the department of insurance to study the gradual reduction of consent to rate deviations by insurers, directing the department of insurance to conduct a public awareness campaign on consent to rate deviations, and appropriating funds to the department of insurance.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 58‑36‑30 reads as rewritten:
"§ 58‑36‑30.  Deviations.
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(b1)	This subsection applies only to insurance against loss to residential property with not more than four housing units. A rate in excess of that promulgated by the Bureau may be charged by an insurer on any specific risk if the higher rate is charged in accordance with rules adopted by the 

Commissioner and with the knowledge and consent of the insured.
At least 60 days prior to charging a higher rate an insurer shall notify the insured: (i) that the rates used to calculate the premium for the policy will be greater than those rates that are applicable in the State of North Carolina, (ii) what the premium based upon approved rates in North Carolina for residential property would be, (iii) what the insurer's premium for this coverage will be, (iv) of the specific justification for charging the greater rate, and (v) of any actions the insured could take to mitigate the insurer's justification for charging a higher rate. The notice and consent required by this subsection may be in electronic form and delivered by electronic means.
Any data obtained by the Commissioner under this subsection is proprietary and confidential and is not a public record under G.S. 132‑1 or G.S. 58‑2‑100.
(b2)	Notwithstanding subsection (b1) of this section, the Commissioner shall collect annually from all insurers and publish on the Department's website no later than July 1 the following data aggregated across all insurers for each geographical rate‑making territory:
(1)	The number of policies in effect, or other exposures insured. For the purposes of this subsection, "policies in effect" shall mean the number of policies written in the reporting year, and "other exposures," if any, shall mean any coverage extended other than policies written, and shall be described in the report in sufficient detail to identify the coverage provided.
(2)	The number of applications for coverage.
(3)	The number of applications for which coverage was not provided, classified according to applications withdrawn, applications denied, and applications still in process.
(4)	The number of policies not renewed, classified according to nonrenewals initiated by the insurer, and nonrenewals initiated by the policyholder, with subclassifications to include the following reasons for nonrenewal:
a.	For nonrenewals initiated by the insurer: (i) lack of payment, (ii) misrepresentation, (iii) property features, (iv) climate risk, (v) reduction in service area, or (vi) other.
b.	For nonrenewals initiated by the policyholder: (i) cost, (ii) untimely settlement of claims, (iii) unsatisfactory customer service, (iv) identification of more suitable insurance options, (v) vacating property, or (vi) other.
(5)	The number of policies canceled or terminated.
(6)	The number of claims filed.
(7)	The number of claims approved, classified according to in whole, in part, and number of days lapsed from claim filed to approval.
(8)	The number of claims denied, classified according to in whole, in part, and number of days lapsed from claim filed to denial.
(9)	The dollar amounts of the losses incurred.
(10)	The dollar amounts of the losses paid.
(11)	The dollar amounts of the premium charged for coverage.
(12)	Applicable rates for each form of property insurance and rating classification, including rates by tier in multitier programs, and differentiating between policies with varying types of benefits, including, but not limited to, guaranteed replacement cost, standard or limited replacement cost, market value or actual cash value, and differentiating among policies issued for single‑family homes, multifamily homes, condominium or cooperative units, and business properties or farms.
(13)	The deductible, classified as a percentage of the insured property's value.
(14)	For covered insurance companies distributing through direct solicitation, the number of direct mail or telephone solicitations.
(15)	The number of agents appointed by the covered insurance company.
(16)	The street addresses of all offices issuing or servicing policies.
(17)	Languages spoken, other than English, with sufficient fluency to conduct business in that language by personnel within each office.
(18)	Whether the covered insurance company issues policies in a language other than English and, if so, identifying the languages in which policies are issued and the number of policies issued in each language.
(19)	For each of the categories of information described in subdivisions (1) through (13) of this subsection, further classifications and aggregated data according to race, national origin, ethnicity, household income level, and gender of the insureds or applicants according to categories and subcategories as defined by the federal Office of Management and Budget's Statistical Policy Directive No. 15 for race and ethnicity data, as well as classifications and aggregated data by race, national origin, ethnicity, and income level characteristics of the census tract in which the insured risk is located including whether the insured risk is located in a disadvantaged community. Where an insurer applies any other classification which affects the premium rate at which the policy is issued, such as credit score or credit‑based insurance score, the insurer shall provide totals by race, national origin, ethnicity, household income level, and gender for each such classification and applicable premium rate based on the modifying classification. Notwithstanding any other provisions of this subsection, data collected pursuant to subdivision (13) of this subsection will not be reported as aggregated data but as individual record data as described in subdivision (23) of this subsection.
(20)	The information upon which an insurer, rate service organization, or group of insurers filed with the Commissioner in support of the rates as required to be filed with the Commissioner. An insurer or group of insurers which are members or subscribers of a rate service organization which makes or files rates on its behalf shall be responsible for filing of the information as part of the report required by this subdivision.
(21)	The total dollar amount of financing to fossil fuel businesses, including investments and underwriting in terms of total gross premiums in dollars, disaggregated by company and project in a format determined by the Commissioner.
(22)	The total dollar amount of financing for new fossil fuel projects, including investments and underwriting in terms of total gross premiums in dollars, disaggregated by company and project in a format determined by the Commissioner.
(23)	In addition to aggregate data required to be reported under this subsection, each insurer shall file with the Commissioner, and make available to the public, the individual record data collected pursuant to subdivisions (1) through (13) of this subsection, as well as data related to modifying classifications if relevant as described in subdivision (17) of this subsection, from which the report summaries were tabulated. Such data shall be provided in an online electronic database format prescribed by the Commissioner, and the Commissioner shall make such database files available directly to the public. The Commissioner shall require that all information which would personally identify any individual applicant or policyholder be deleted. The categories of data to be made available for each individual record shall include all of the same categories of information collected pursuant to subdivisions (1) through (13) of this subsection, as well as data related to modifying classifications if relevant as described in subdivision (17) of this subsection, contained in the aggregate report and shall be presented in accordance with standardized classification codes to be established by the Commissioner.
The Commissioner shall designate the format and manner to collect the data to be published.
Any nonaggregated data obtained by the Commissioner, including data identifying individual insurers or insureds, under this subsection is proprietary and confidential and is not a public record under G.S. 132‑1 or G.S. 58‑2‑100. This subsection applies only to insurance against loss to residential real property with not more than four housing units.
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SECTION 2.  G.S. 58‑36‑90 reads as rewritten:
"§ 58‑36‑90.  Using credit scoring to rate noncommercial private passenger motor vehicle and residential property insurance prohibited.
(a)	Definitions. – As used in this section:
	
(2)	"Credit report" means any written, oral, or other communication of any information by a consumer reporting agency that bears on a consumer's credit worthiness, credit standing, or credit capacity. Credit report does not include accident or traffic violation records as maintained by the North Carolina Division of Motor Vehicles or any other law enforcement agency, a property loss report or claims history that does not include information that bears on a consumer's credit worthiness, credit standing, or credit capacity, or any report containing information solely as to transactions or experiences between the consumer and the person making the report.
(3)	"Credit score" means a score that is derived by utilizing data from an individual's credit report in an algorithm, computer program, model, or other process that reduces the data to a number or rating.

	
(b)	Prohibitions; Exceptions. – In the rating and underwriting of noncommercial private passenger motor vehicle and residential property insurance coverage, insurers shall not use credit scoring as a basis for terminating an existing policy or any coverage in an existing policy or subjecting a policy to consent to rate as specified in G.S. 58‑36‑30. Insurers may use credit scoring as the sole basis for discounting rates. For purposes of this subsection only, "existing policy" means a policy that has been in effect for more than 60 days.

	

	
	
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SECTION 3.  The Department of Insurance shall adopt rules to implement Sections 1 and 2 of this act.
SECTION 4.(a)  The Department of Insurance (DOI) shall study the feasibility of and methodology for gradually reducing the number of rate deviations authorized by G.S. 58‑36‑30. The study shall develop a plan for reducing the percentage of households consenting to rates in excess of that promulgated by the North Carolina Rate Bureau pursuant to G.S. 58‑36‑30 to twenty percent (20%) of the statement insurance market or lower. The plan shall (i) implement the reduction in usage of deviations pursuant to G.S. 58‑36‑30 by no later than January 1, 2040, and (ii) include strategies for preserving access to insurance while gradually reducing the usage of deviations pursuant to G.S. 58‑36‑30.
SECTION 4.(b)  Beginning January 1, 2027, DOI shall conduct a public awareness campaign on the usage of rate deviations pursuant to G.S. 58‑36‑30 by insurers. The campaign shall include education and recommendations relating to risk reduction and home resilience for insureds.
SECTION 4.(c)  No later than October 1, 2027, DOI shall report specific proposals for implementing the plan developed pursuant to subsection (a) of this section to the chairs of the Joint Legislative Oversight Committee on General Government.
SECTION 5.  There is appropriated from the General Fund to the Department of Insurance the sum of fifty thousand dollars ($50,000) in nonrecurring funds for the 2026‑2027 fiscal year to conduct the study and public awareness campaign required by this act.
SECTION 6.  Sections 1 and 2 of this act become effective October 1, 2027, and apply to policies issued, amended, or renewed on or after that date. Section 5 of this act becomes effective July 1, 2026. The remainder of this act is effective when it becomes law.