Canadians want government to do more to control auto insurance
JOHN'S, NF, July 25 /CNW/ - More than one-half of Atlantic Canadians
believe that changes in the current automobile insurance system
are needed, which is consistent with figures reported a year ago,
according to a report released today by the Insurance Bureau of
Canada. The poll was conducted in June, 2002, by Corporate Research
Associates of Halifax.Overall, a plurality of Atlantic Canadians
still believe that the provincial government has a responsibility
to deal with the issue of rising automobile insurance rates. This
number has increased since last year. Results also suggest that
the number of Atlantic residents who believe increasing rates
should be addressed by either consumers or the public utilities
and regulatory boards has just about doubled.
A large majority of Atlantic residents believe that rates have
increased over the past few years, primarily because of the rising
cost of claims and injuries. Eighty-one per cent of those asked
said the cost of auto insurance has increased either significantly
or somewhat in the past few years. Forty-four per cent point to
rising costs of claims and injuries as the number one contributing
factor behind higher auto insurance costs. To a lesser extent,
public perception is that these higher costs are a result of insurance
fraud or false claims. Fewer believe that hikes are related to
"For many years, insurers have been asking governments to
make the much-needed changes for the sake of all drivers in Atlantic
Canada," says Don Forgeron, Regional Vice-President of the
Insurance Bureau of Canada."We are sharing these recent results
with government officials because it is they who decide, through
legislation, on the kind of auto insurance companies are allowed
to sell," says Forgeron.
When asked what amount of insurance claim payments should be directed
toward expenses such as medical rehabilitation, pain and suffering,
repairs to vehicles, and compensation for lost income; residents
ranked medical rehabilitation and repairs to vehicles as the most
"In reality, the opposite trend is actually occurring,"
says Forgeron. "A recent study on bodily injury closed claim
files tells us that the highest percentage of claims dollars goes
towards compensation for pain and suffering."
The Bodily Injury Closed Claim studies conducted in New Brunswick,
Nova Scotia and Newfoundland indicate that the percentage of total
settlement dollars that goes towards compensation for pain and
suffering is 61%, 67% and 57% respectively. These studies also
reveal that in New Brunswick, the percentage of settlement dollars
that goes towards lost income and medical rehabilitation is approximately
31%; in Nova Scotia, 23%; and in Newfoundland, 36%.
Industry estimates that the percentage of total settlement dollars
that goes towards repairing vehicles in New Brunswick is approximately
21%; in Nova Scotia, 24%; and in Newfoundland, 23%. The data was
collected through telephone interviews with a representative sample
of 1504 residents in Atlantic Canada, age 18+. A sample of this
can expect to yield a margin of sampling error of +/- 2.5 percent.
A copy of the report highlights and statistical breakdowns by
province is available at the Insurance Bureau of Canada's consumer
centre in Halifax (902-429-2730, ext. 227 or at 1-800-565-7189,
ext. 227) or you can download a copy from the IBC web site at
The Insurance Bureau of Canada is the national trade association
of the private property and casualty insurance industry. It represents
about 200 companies that provide more than 90 per cent of the
non-government home, car and business insurance sold in Canada.
Visit the media section of the bureau's Web site for more news
releases and information.