Ask an Agent
Have a question? We're here to help.
Ask an agent for free
Question

What is a reinsurance facility?

I'm moving to North Carolina and am confused. I keep hearing about reinsurance facilities, but I'm not really sure what that means. Can you explain?

Sep 28, 2016 Raleigh, NC

Answer
Author profile picture

The Zebra

The nation's leading independent insurance comparison site

The Zebra is an independent insurance advisor and quote comparison site with headquarters in Austin, Texas. Utilizing its real-time quote comparison …

Sure! In North Carolina, the reinsurance facility is basically a non-profit organization that allows insurance companies to pool the risk of high-risk drivers to keep rates low for consumers and create less risk for insurance companies themselves. Since car insurance rates in North Carolina are capped, an insurance provider can cede (transfer) your policy to the reinsurance facility so that they share the risk with all other companies in the organization and you still benefit from a fair price.

It's a fairly complicated subject so I would recommend speaking with an insurance agent once you get to North Carolina and ask for a more "hands-on" explanation. Hope this helps!

Ask an Agent
Have a question? We're here to help.
Ask an agent for free

Insurance is complicated, but it doesn't have to be.

The Zebra searches all of the top insurance companies, in one place, so you can compare the cost and coverage you need to protect your car, home and other property.

Step 1: Tell us a little about yourself

Choose an insurance product and enter your zip code to get started.

Step 2: Sip your coffee while we find the best quotes

Enter the necessary information and then sit back while we find quotes from 100 top insurance carriers.

Icon Fill Form

Step 3: Compare your quotes

Compare quotes side-by-side to find the right match for you, whether it's home, auto, or more.

Icon Agent

Step 4: Let our agents do the hard work for you

Once you pick your policy, our agents are here to get you over the finish line. Then just relax and enjoy your savings.

Compare insurance rates today!

Location pin icon
No junk mail. No spam calls. Free quotes.

Related Questions

Other people are also asking...

How does changing my due date affect my car insurance

Sorry to hear about your accident.  You should still be covered since it sounds like you didn't miss your payment. Sometimes, if you completely change your due date, you can miss a billing cycle. In terms of your accident, you should still be covered. Due dates are notices of bills to be paid.…
May 10, 2018 Fort Myers, FL

Do I need insurance on my old car if I'm planning to sell it?

There are a couple of things to consider in your situation. Any grace period would depend on the exact details of your current policy. While most policies do include a grace period, it really depends on your current company. If there is a grace period, it would apply to the new car as long as you k…
May 20, 2023 Minneapolis, MN

How can I get cheaper insurance after a reckless driving charge?

Thank you for reaching out to The Zebra. This is a great question, and I'm sure the high rate is getting frustrating after almost three years. Reckless driving is, unfortunately, considered a major violation. However, these violations typically start to fall off your record after a period of t…
Mar 13, 2023 Central, SC

How do I update my car insurance after getting a new license?

Congrats on the move! Because car insurance is priced at the zip code level and regulated at the state, you're going to want to update your coverage to reflect that. Bear in mind, your premium will change as a result of your move. According to our data, the average premium in Illinois is $1,28…
Jul 10, 2018 Morrisville, NC