The effects of hurricanes continue to be felt in coastal areas.
Due to worries about hurricane risks, Nationwide has decided not to renew 10,525 homeowner’s insurance policies in the state of North Carolina.
According to a report in The Virginian Pilot, the change will affect 4.4% of the insurer’s 237,652 policies in the state and 1.7% of the insurer’s 621,705 policies nationally.
Over a thousand policyholders in the Outer Banks are affected by the non-renewals, the highest number in any region of the state.
North Carolina Department of Insurance (NCDOI) communications director Jason Tyson said that 5,781 policies were not renewed based on a “hurricane hazard assessment tool,” while 4,744 policies will be referred to the North Carolina Insurance Underwriting Association, also known as the Beach Plan.
According to Tyson of the Virginian Pilot, Nationwide informed the NCDOI of its decision in February 2023, claiming the need to examine and realign its portfolio based on risk variables like climate severity, weather-related losses, and changes in the reinsurance market.
Tyson continued by saying that the policies that were not renewed might potentially be rewritten with the insurer “if wind exposure is ceded to the North Carolina Insurance Underwriting Association and if current underwriting guidelines are met.”
Scott Weatherly, an insurance agent, warns that this choice may not be open to residents of the Outer Banks because Nationwide has not issued new homeowner’s policies on the barrier islands in around ten years.
According to Weatherly, who also co-owns Weatherly Insurance Agency, policies with wind and hail coverage from Nationwide will not be renewed, while those without such coverage will stay in effect.
Weatherly claims that the non-renewals affect more than 100,000 houses from Texas to the Northeast, including more than 9,000 homes along the coast of North Carolina.
Weatherly noted that the April announcement by Nationwide was followed by the start of cancellations in July. Many customers with upcoming renewal dates between December 2019 and July 2024 have not yet received word of the switch.
In spite of inflation and market disruptions, Nationwide is “on a path to long-term growth,” according to a corporate statement. It also stated that it would be revising its pricing structure and becoming pickier in terms of the policies it is “willing to write.”
According to a statement given via email to the Virginian Pilot, the company is “taking the necessary actions that ensure long-term viability and allow us to offer protection at a competitive price to customers across all our business lines who represent a variety of needs.”
Earlier this year, news outlets reported that Nationwide was among the major insurers leaving Virginia’s coastal communities. One man from Hampton Roads explained his experience with Nationwide’s decision not to renew his policy to WTKR News 3.
Fred Drummond said to the local media, “In June, I received a call from my agent that Nationwide would not be renewing my policy which I had for over 20 years.” They will not be offering policy renewals or new policies in the 23451 zip code.
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