S 490 - Automobile Insurance Regulatory Modernization

• Removes nonfleet private passenger motor vehicle insurance and motorcycle insurance from the North Carolina Rate Bureau's jurisdiction, allowing these coverages to be rated under the standard Article 40 regulatory framework instead of the Rate Bureau's previous jurisdiction.

• Creates a new "flex-rating" system (Article 37A) allowing insurers to implement rate changes of 15% or less statewide without prior Commissioner approval; rates above 15% remain subject to standard approval procedures.

• Establishes credit scoring regulations for both nonfleet private passenger motor vehicle and residential property insurance, prohibiting use of credit scores as the sole basis for policy termination but allowing use for rate discounts.

• Adds new sections to the North Carolina Reinsurance Facility establishing a Safe Driver Incentive Plan with classifications, premium surcharges, and point systems based on driving records, accidents, and traffic violations.

• Requires the Reinsurance Facility to gradually eliminate premium discounts for "clean risks" through October 1, 2016, and mandates reports to the legislature by October 2016 and 2018 on market transition options.