Important Update: Changes Coming to North Carolina Auto Insurance in 2025

New laws recently passed by the North Carolina General Assembly will bring changes to auto insurance policies starting July 1, 2025. These updates will impact all insurance companies operating in the state, including Wells.

Here’s a quick overview of what’s changing:

Higher Minimum Coverage Limits

Starting with renewals on or after July 1, 2025, North Carolina will raise the minimum required coverage for auto insurance. Here’s what’s changing:

• Current minimum: $30,000 per person / $60,000 per accident
• New minimum: $50,000 per person / $100,000 per accident

• Current minimum: $25,000 per accident
• New minimum: $50,000 per accident

What this means for you:

If you currently carry only the state minimum, your coverage — and your premium — will adjust automatically at your next renewal after July 1, 2025.

If you already carry higher limits, you may not see a change related to this update.

Expanded Uninsured and Underinsured Motorist Coverage

Starting July 1, 2025, all auto insurance policies in North Carolina will automatically include:

• Uninsured Motorist (UM) coverage — protects you if you're hit by a driver who doesn't have insurance.
• Underinsured Motorist (UIM) coverage — helps if you're hit by a driver who doesn’t have enough insurance to cover the damages.

The new law broadens the protections offered under UIM coverage, giving drivers stronger financial protection after accidents.

Note: The exact rate changes for this expanded coverage are still being worked out by the North Carolina Rate Bureau.

Changes to Prayer for Judgment Continued (PJC)

Starting July 1, 2025, the rules around using a Prayer for Judgment Continued (PJC) will change:

• A PJC is a legal option that helps drivers avoid insurance points after certain traffic violations.
• If you use a PJC to avoid insurance points, it will only cause a premium increase if you had another PJC in the past five years.
• Right now, the lookback period is three years, but it’s being extended to five years.

In short:

If you haven’t used a PJC in the last five years, you can still use one without your insurance premium going up.

Big Changes Coming for New Drivers

If you or someone in your household will be getting their driver's license for the first time, here’s an important update:

• Starting July 1, 2025, newly licensed drivers will be considered "inexperienced" for eight years instead of three.
• This could mean higher insurance rates for a longer period of time.
• Tip: If you have a young driver who currently has a learner’s permit, they may want to get their driver’s license before July 1, 2025 to avoid being affected by this change.

Discounts may eventually be available for inexperienced drivers who stay accident- and violation-free, but details are still being worked out.

Changes to How Convictions Impact Rates

• Major violations (those worth four or more points) will now impact your premium for five years instead of three.
• Minor speeding tickets (less than 10 mph over the limit) can still be waived — as long as there are no other chargeable convictions in the last five years (currently three years).

What You Can Expect

These updates will automatically be applied to your policy at your renewal after July 1, 2025. You don’t need to do anything right now.

We’ll continue to keep you informed as more details become available.

If you have any questions or want to discuss how these changes could affect you or your family, feel free to reach out to your client advisor.