Auto, health, and homeowners insurance rates are all increasing in North Carolina. Here’s what’s behind the surge in prices.
Insurance. It’s one of those things you have to have in life, but it’s also notoriously expensive. And unfortunately, here in North Carolina and across the United States, insurance costs are rising.
Homeowners, auto, and health insurance rates have all gone up in 2026, and experts predict they’re likely to continue growing in 2027.
What’s causing this increase? Inflation, yes, but there are also other factors at play.
Auto insurance
In North Carolina (as in all other states and Washington, D.C., except New Hampshire), auto insurance is required in order to legally operate a vehicle. In fact, nearly all states require drivers to hold minimum auto liability insurance (though those requirements vary).
In North Carolina, drivers must carry continuous liability insurance, meaning the coverage cannot be interrupted. The state also requires coverage for underinsured/uninsured motorists, plus the minimum for bodily injury and property damage.
Here are the primary reasons your vehicular insurance costs are rising in North Carolina:
Mandated minimum liability coverage
As of July 1, 2025, the state raised its mandated minimum liability limits for the first time since 1999. That means the maximum paid to each person injured in an auto accident has gone from $30,000 to $50,000.
Likewise, the maximum a policy pays for third-party injuries or deaths has risen from $60,000 to $100,000. The maximum amount to be paid toward property damage has increased from $25,000 to $50,000.
Mandatory uninsured motorist coverage
Additionally, all new and renewed liability policies must include mandatory Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverage. This boosted mandatory coverage limits so that every policy will have a minimum of $50,000 UM/UIM coverage in order to cover damages if an at-fault driver’s insurance is insufficient.
Rate increase
Auto insurance base rates rose an average of 5% for new and renewed policies starting Oct. 1, 2025, under a settlement between State Insurance Commissioner Mike Causey and the N.C. Rate Bureau, which represents homeowners’ insurance companies (the bureau had originally requested 22.6%).
Health insurance
Many consumers could see increases of about 10% or more in 2027 for premiums, copayments, and deductibles, experts told CNBC.
Employer-sponsored plans
Roughly 165 million people get health insurance through an employer that subsidizes care by paying a chunk of employees’ monthly premiums. Experts predict that in 2027, this cost for employers will rise anywhere from 8% to 11% per worker. That’s the biggest increase in more than 20 years.
State health plan
Some 750,000 state employees like teachers and state workers—as well as retirees and dependents—get their insurance from the North Carolina State Health Plan. Officials have warned the plan may run out of funds by 2027, so the Board of Trustees voted in October to double monthly contributions from the Retiree Health Benefit Fund to keep the plan solvent.
Starting in 2027, the plan will have a multi-tier provider network: preferred, access, non-preferred, and out-of-network. Members who use preferred providers will enjoy lower deductibles and lower out-of-pocket costs because the providers will charge the state lower rates. Conversely, people who use non-preferred providers will begin paying markedly higher deductibles and out-of-pocket costs. People who see access providers will not see their rates increase or be discounted.
Affordable Care Act (ACA) / Individual health insurance
The more than 19 million people who get their health insurance through the Affordable Care Act will also likely see price increases. Analysts at KFF found insurers proposed a median premium increase of about 15% for 2027. If finalized, this increase will be the second consecutive year premiums have gone up by double digits.
Several factors are behind these surging prices. In addition to inflation, insurers participating in the ACA Marketplace cite labor shortages for skilled healthcare workers and overall increases in medical and health services as causes of higher prices.
Insurers also cite the expiration of enhanced federal premium subsidies at the end of 2025, which drove healthier enrollees out of the market. North Carolina saw the steepest drop in Marketplace sign-ups in the country this year.
Homeowners insurance
In January 2025, Causey and insurance companies reached a settlement resolving a legal dispute that had been going on since January of the previous year. The N.C. Rate Bureau originally requested a rate increase of more than 42% on average and up to 99.4% in some areas.
Causey secured an average increase of 15%, with a 7.5% bump on June 1, 2025, and another 7.5% on June 1, 2026, with a maximum of 35% in certain parts. The agreement also prohibits the Rate Bureau from seeking another increase until June 1, 2027.
The Rate Bureau cited climate change as a source of the increase, particularly in coastal areas prone to hurricanes and flooding.
Dwelling insurance
Separate from their own home insurance policies, dwelling insurance applies to owners of non-owner-occupied properties, such as vacation and rental homes and investment units.
In a separate April 2026 settlement, Causey negotiated dwelling insurance increases of 5% per year for two years, down from the 68.3% the Rate Bureau requested. The first increase took effect Oct. 1, 2026, and the second will be implemented Oct. 1, 2027. Like homeowners insurance, dwelling insurance increases will vary by location.
What you can do
- ACA: Compare plans during open enrollment, which starts Nov. 1, at HealthCare.gov (North Carolina uses the federal marketplace). Most enrollees still qualify for some subsidy: 87% of enrollees qualified for premium subsidies during 2026 open enrollment.
- State Health Plan: Check whether your doctors are preferred, access, or non-preferred using the plan’s provider tool. Members with certain complex conditions who see non-preferred providers can request an exception for the access tier benefit.
- Home and auto: Shop around at renewal. Rates vary by insurer, and some charge more or less than the bureau rate.
