1. THE IN’S AND OUT’S OF THE NORTH CAROLINA RATE BUREAU

2. The North Carolina Rate Bureau Automobile Rate Administrative OfficeAutomobile Rate Administrative Office North Carolina Fire Rating BureauNorth Carolina Fire Rating Bureau Compensation Rating and Inspection Bureau of North Carolina

3. The North Carolina Rate Bureau 58-36-1. North Carolina Rate Bureau created. There is hereby created a Bureau to be known as the "North Carolina Rate Bureau," with the following objects and functions: (1) To assume the functions formerly performed by the North Carolina Fire Insurance Rating Bureau, the North Carolina Automobile Rate Administrative Office, and the Compensation Rating and Inspection Bureau of North Carolina, with regard to the promulgation of rates, for insurance against loss to residential real property with not more than four housing units located in this State and any contents thereof and valuable interest therein and other insurance coverages written in connection with the sale of such property insurance; except as provided in G.S. 58-36-3(a)(6), for theft of and physical damage to non-fleet private passenger motor vehicles; for liability insurance for such motor vehicles, automobile medical payments insurance, uninsured motorists coverage and other insurance coverages written in connection with the sale of such liability insurance; and for workers' compensation and employers' liability insurance written in connection therewith except for insurance excluded from the Bureau's jurisdiction in G.S. 58-36-1(3).

4. The North Carolina Rate Bureau Private Passenger Non-Fleet AutomobilePrivate Passenger Non-Fleet Automobile Residential PropertyResidential Property HomeownersHomeowners DwellingDwelling Mobile HomeownersMobile Homeowners Workers CompensationWorkers Compensation

5. The North Carolina Rate Bureau To provide common policy formsTo provide common policy forms To provide a common base premium for companies to useTo provide a common base premium for companies to use To create a “clearing house” for statistical dataTo create a “clearing house” for statistical data

6. The North Carolina Rate Bureau 1. A private passenger auto is a four wheel motor vehicle, other than a truck type or van, owned or leased under contract for a continuous period of at least six months, and a. Not used as a public or livery conveyance for passengers. b. Not rented to others. 2. A motor vehicle that is a pickup truck or van shall be considered a private passenger auto, if it: a. Is owned by an individual or by a husband and wife or individuals who are residents of the same household, b. Has a Gross Vehicle Weight as specified by the manufacturer of less than 10,000 lbs.; and c. Is not used for the delivery or transportation of goods or materials unless such use is: (1) Incidental to the insured's business of installing, maintaining or repairing furnishings or equipment; or (2) For farming or ranching.

7. The North Carolina Rate Bureau A Homeowners Policy may be issued: 1. To the owner-occupant(s) of a 1, 2, 3 or 4 family dwelling which is used exclusively for private residential purposes (except as provided in Paragraphs F. and H.). A 1 family dwelling may not be occupied by more than one additional family or two roomers or boarders. In a 2, 3 or 4 family dwelling, an individual family unit may not be occupied by more than two families or one family with two roomers or boarders; or 2. To the purchaser-occupant(s) who has entered into a long term installment contract for the purchase of the dwelling and who occupies the dwelling but to whom title does not pass from the seller until all the terms of the installment contract have been satisfied. The seller retains title until completion of the payments and in no way acts as a mortgagee. The seller’s interest in the building and premises liability may be covered using Additional Insured Endorsement HO 04 41; or

8. The North Carolina Rate Bureau 3. To the occupant of a dwelling under a life estate arrangement when the Coverage A amount is at least 80% of the dwelling’s replacement cost. The owner’s interest in the building and premises liability may be covered using Additional Insured Endorsement HO 04 41; or 4. To cover dwellings in the course of construction provided the policy is issued only in the name of the intended owner-occupant(s) of the dwelling. 5. When two or more apartment units in a 2, 3 or 4 family dwelling are occupied by co-owners, each occupying distinct living quarters with separate entrances. Given these circumstances, a Homeowners Policy providing building coverage may be issued to only one of the co-owner occupants of the dwelling. The policy may be endorsed to cover the interest of the other co-owner(s) in the building and for premises liability. Use Additional Insured Endorsement HO 04 41. A separate Homeowners Policy HO 00 04 may be issued to the co-owner(s) occupying the other apartment(s) in the dwelling.

9. The North Carolina Rate Bureau Governing CommitteeGoverning Committee Automobile CommitteeAutomobile Committee Personal Auto Policy (PAP) SubcommitteePersonal Auto Policy (PAP) Subcommittee Subcommittee on Automobile TerritoriesSubcommittee on Automobile Territories Property CommitteeProperty Committee Forms SubcommitteeForms Subcommittee Rating SubcommitteeRating Subcommittee Workers Compensation CommitteeWorkers Compensation Committee

10. The North Carolina Rate Bureau Rates Reviewed by Line CommitteesRates Reviewed by Line Committees Recommend Adoption to Governing CommitteeRecommend Adoption to Governing Committee Governing Committee AdoptsGoverning Committee Adopts Rate Filing Submitted to DOIRate Filing Submitted to DOI Approved or DisapprovedApproved or Disapproved Circular to Member Companies Announcing Rate RevisionCircular to Member Companies Announcing Rate Revision

11. The North Carolina Rate Bureau How Forms Are CreatedHow Forms Are Created Insurance Services Office CreatedInsurance Services Office Created Proposals From Member CompaniesProposals From Member Companies Court DecisionsCourt Decisions Staff ReviewStaff Review Committee ReviewCommittee Review Filed With Department of InsuranceFiled With Department of Insurance Circular Letter Issued to CompaniesCircular Letter Issued to Companies

12. The North Carolina Rate Bureau How Rates Are MadeHow Rates Are Made Auto & Workers Comp filed each yearAuto & Workers Comp filed each year Property Lines filed as often as possibleProperty Lines filed as often as possible Basic FormulaBasic Formula Losses + Expenses + Profit = ExposuresLosses + Expenses + Profit = Exposures Indicated Premium per Exposure Statistical Agents Collect DataStatistical Agents Collect Data

13. The North Carolina Rate Bureau If Approved by Commissioner – ImplementIf Approved by Commissioner – Implement If Disapproved by Commissioner – DecisionIf Disapproved by Commissioner – Decision Implement Commissioners Ordered RateImplement Commissioners Ordered Rate Appeal to Court of AppealsAppeal to Court of Appeals Implement Filed RatesImplement Filed Rates Escrow Difference between Ordered Rates and Implemented RatesEscrow Difference between Ordered Rates and Implemented Rates