Key Takeaways
- The North Carolina Department of Insurance (NCDOI) regulates all P&C insurance activities under NC General Statutes Chapter 58
- The Commissioner of Insurance is ELECTED by North Carolina voters for a 4-year term
- North Carolina uses a "prior approval" rate system for most P&C lines, requiring NCDOI approval before rates take effect
- NCDOI has authority over licensing, rate review, market conduct, and consumer protection
- North Carolina is one of only 11 states where the Insurance Commissioner is elected
North Carolina Department of Insurance (NCDOI)
Important: This study guide covers North Carolina state-specific Property & Casualty insurance content only. You should complete the national Property & Casualty exam preparation first, as it covers the foundational insurance concepts tested on your exam.
The North Carolina Department of Insurance (NCDOI) is the state agency responsible for regulating the Property & Casualty insurance industry in North Carolina.
The Commissioner of Insurance
The Commissioner of Insurance is:
- ELECTED by North Carolina voters (one of only 11 states with an elected Commissioner)
- Serves a 4-year term
- Responsible for enforcing NC General Statutes Chapter 58
- Authorized to adopt regulations, review rates, investigate violations, and discipline licensees
Commissioner Powers for P&C Insurance
| Power | Description |
|---|---|
| Licensing | Issue, suspend, and revoke producer licenses |
| Rate Review | Prior approval required for most P&C rates |
| Market Conduct | Examine insurer business practices |
| Enforcement | Investigate and prosecute violations |
| Consumer Protection | Handle complaints and protect policyholders |
| Rulemaking | Adopt rules under NC Administrative Code |
Exam Tip: North Carolina is one of only 11 states where the Insurance Commissioner is ELECTED. This is a frequently tested fact.
North Carolina Rate Regulation
North Carolina uses prior approval for most P&C lines:
Rate Systems by Line
| Line of Insurance | Rate System |
|---|---|
| Personal Auto | Prior approval (Rate Bureau) |
| Homeowners | Prior approval |
| Commercial Lines | File and use (some lines) |
| Workers' Compensation | Rate Bureau sets rates |
| Title Insurance | NCDOI sets rates |
Prior Approval
Under North Carolina prior approval:
- Rates must be filed and approved BEFORE use
- NCDOI reviews rates for compliance
- Rates must not be excessive, inadequate, or unfairly discriminatory
- NC Rate Bureau files rates for personal auto and some lines
How is the North Carolina Commissioner of Insurance selected?
What rate system does North Carolina use for personal auto insurance?