BREAKING NEWS! QB Strikes Down Cap On Minor Injuries!

[Slava]

Originally Posted by Cowboy89

And therein lies one of the biggest problems with insurance and public policy. Statistically speaking you can probably discriminate on a number of different grounds to optimize pricing mechanisms that seem morally reprehensible to the public. IE (Race, religion, sexual orientation). The problem being that once an insurer has to avoid discriminating based on these things then the real cost of risk of a particular individual becomes cloudier. Therefore ultimately those who are truly less risky end up subsidizing riskier groups. We've already seen instances of this in BC and Sask in the past where efforts to make insurance cheaper for young male drivers has raised the costs for other less risky groups.

Good post. Part of the problem in Alberta has been that it was legislated that the costs for young drivers were too high. Statistically (and probably anecdotally for a lot of us) it can be shown that young drivers are riskier to insure than older drivers, so logically that class ought to pay more in premiums.

[ikaris]

Ultimately, liability insurance needs to be provided by the government and should not be a profitable venture as it is required by law to have it.

Anything above that can be provided by the private insurance companies.

[Finny61]

Should banks be under the government then too? They assume your risk for a fee and the services they provide are considered essential to all families, not required by law but still very essential much like hydro, water, etc. I'm not for or against government insurance at all but it's no secret in insurance there is no money to make in auto insurance, so whether a private insurer or government entity takes on the market, we all end up paying for it one way or another.

[Mike F]

Originally Posted by fredr123

http://network.nationalpost.com/np/b...itutional.aspx

Nova Scotia's damage cap was ruled constitutional at first instance in the Nova Scotia Supreme Court. You'll recall Alberta's Court of Queen's Bench found the opposite result here. That matter is yet to be heard before the Court of Appeal.

I'll be starting suit against Fredr123 for whiplash, other soft tissue injuries and emotional distress suffered when I scrolled down the 1st page and thought Lanny MacDonald was back.

[Slava]

Originally Posted by Finny61

Should banks be under the government then too? They assume your risk for a fee and the services they provide are considered essential to all families, not required by law but still very essential much like hydro, water, etc. I'm not for or against government insurance at all but it's no secret in insurance there is no money to make in auto insurance, so whether a private insurer or government entity takes on the market, we all end up paying for it one way or another.

The banks are not the same thing. The insurers have what amounts to a legislated monopoly. If you want a car you MUST have PLPD coverage. There is no such rule regarding any banking product that I'm aware of?

[Vulcan]

Originally Posted by Slava

The banks are not the same thing. The insurers have what amounts to a legislated monopoly. If you want a car you MUST have PLPD coverage. There is no such rule regarding any banking product that I'm aware of?

I liked it in the old days where once you turned 21, you no longer had to carry insurance. Risky I guess because mistakes happen, but people drove accordingly and not as if they were invincible and didn't give a crap.

[Slava]

Originally Posted by Vulcan

I liked it in the old days where once you turned 21, you no longer had to carry insurance. Risky I guess because mistakes happen, but people drove accordingly and not as if they were invincible and didn't give a crap.

I think that society is better off compensating people who are injured though...especially those who are catastrophically injured.

[Vulcan]

Originally Posted by Slava

I think that society is better off compensating people who are injured though...especially those who are catastrophically injured.

Yeah, I agree with your legislated monopoly point and that injured people deserve compensation, just trying to throw some historical perspective on the issue as most here probably think auto insurance has always been compulsory. In BC I think it was changed about 1970, so not that long ago.

The other point is that a lot of drivers, drive like their are no consequences to their actions or inattention as they are fully insured and safe in their SUVs or whatever.

[Finny61]

Originally Posted by Slava

The banks are not the same thing. The insurers have what amounts to a legislated monopoly. If you want a car you MUST have PLPD coverage. There is no such rule regarding any banking product that I'm aware of?

But banks offer a product that most households require, accounts and mortgages to ensure they are secured. It's not that government imposes it to force you to have it but legally you need it to carry ownership. The banks have an oligopoly in place and it is firm, too many insurers have saturated the insurance market it is not a monopoly in the least it is very competitive depending on what insurance lines you look at, since auto is regulated there isn't much difference, for the other lines the market is made up of hard and soft cycles that look more normal.

The government interferes with banks much like insurers, they act as watchdogs.

[fredr123]

http://www.calgaryherald.com/news/al...211/story.html

The outcome of a court battle over the provincial cap on pain and suffering awards for minor injuries sustained in vehicle crashes will have a major impact on what level of rate hike auto insurers will be calling for this year, officials say.

If the cap is left in place, drivers could see only a modest increase, said Jim Rivait, the Insurance Bureau of Canada's vice-president for Alberta and the North.


"The increase, if that minor injury regulation is not in place, will be in the 40 per cent range just to keep the system in balance," he said.

[Peanut]

Originally Posted by Slava

In Alberta there was one insurer in particular that was using postal codes to screen out a native reserve a few years ago.

So if they use postal codes to adjust your rates, why then when I moved from NW to SW and called my broker to update my car insurance, they told me the move "had no effect on the premium"?? Is that just BS or are the rates basically the same everywhere within Calgary?

[Boblobla]

Originally Posted by Peanut

So if they use postal codes to adjust your rates, why then when I moved from NW to SW and called my broker to update my car insurance, they told me the move "had no effect on the premium"?? Is that just BS or are the rates basically the same everywhere within Calgary?

I know distance to work plays a factor. My insurance will drop when I move at the end of this month.

[troutman]

"The increase, if that minor injury regulation is not in place, will be in the 40 per cent range just to keep the system in balance," he said.

That's rich. Before the court challenge, the insurers said they didn't even need the cap, but the government put it through anyway.

[Peanut]

Originally Posted by Boblobla

I know distance to work plays a factor. My insurance will drop when I move at the end of this month.

Makes sense. We don't drive to work though, so we don't actually have that type of insurance. "Leisure only", or whatever the term is.

Originally Posted by troutman

"The increase, if that minor injury regulation is not in place, will be in the 40 per cent range just to keep the system in balance," he said.

That's rich. Before the court challenge, the insurers said they didn't even need the cap, but the government put it through anyway.

No kidding.

[Slava]

Originally Posted by Peanut

So if they use postal codes to adjust your rates, why then when I moved from NW to SW and called my broker to update my car insurance, they told me the move "had no effect on the premium"?? Is that just BS or are the rates basically the same everywhere within Calgary?

I'm not an expert on this, but about 90% sure that the major cities are considered a specific territory whereas somewhere like Claresholm is a different territory. Clearly the risks are a little different for drivers in each area. You are also rated differently if you drive the vehicle everyday 100km each way to work or less than 20km and so on.

I don't know that they use the postal code system at all anymore, but with a small town excluding coverage for an entire postal code meant not writing any insurance in that town. This might not make sense for a town like Claresholm...but could be unethical reasons to exclude somewhere like Hobbema. (I'm just picking certain towns here and not meaning anything by my choices!)

[Slava]

Originally Posted by Finny61

But banks offer a product that most households require, accounts and mortgages to ensure they are secured. It's not that government imposes it to force you to have it but legally you need it to carry ownership. The banks have an oligopoly in place and it is firm, too many insurers have saturated the insurance market it is not a monopoly in the least it is very competitive depending on what insurance lines you look at, since auto is regulated there isn't much difference, for the other lines the market is made up of hard and soft cycles that look more normal.

The government interferes with banks much like insurers, they act as watchdogs.

No one forces anyone to take out a mortgage and you can own a home without one. You can also rent a home without a mortgage. There is no such option with an automobile.

[Cowboy89]

Originally Posted by troutman

"The increase, if that minor injury regulation is not in place, will be in the40 per cent range just to keep the system in balance," he said.

That's rich. Before the court challenge, the insurers said they didn't even need the cap, but the government put it through anyway.

Of course that 'System' happens to include major market losses as a result of the market crash.

[CaptainCrunch]

our idiot premier needs to go, his snarky drive slower comment is going to come back to bite him especially since all insurance rates are going to go up.

Its to bad the Liberals are not a viable party in this province.

If it goes up by 40% my insurance goes up by about 528 per year, that's outrageously stupid.

The province needs to step in. I can see people driving without insurance cause they can't afford this boost.

[fredr123]

The Alberta Civil Trial Lawyers Association has a press release making the rounds with their position on the matter. I can't find a link right now but here is some of what they had to say:

40% Insurance Premium Hike a “Manufactured Crisis”

The Insurance Bureau of Canada’s request for a 40% insurance premium hike is nothing more than an attempt at manufacturing a crisis, according to the Alberta Civil Trial Lawyers’ Association (ACTLA).

Association President Jamie Cuming stated that the latest request for a premium hike is a “standard tactic the insurance industry has used in Alberta before – create a crisis over insurance rates and then try to get governments to solve it”. “The bottom line is that the winners in such a crisis are always insurance company profits, and not consumers or victims”, he added.

ACTLA supports Finance and Enterprise Minister Iris Evans in her contention that there is no evidence to support a rate increase of 40%.

ACTLA’s submission to the rate board hearings later this month confirms the insurance industry has continued to earn profits of 20% or more, almost double a reasonable rate and well into the hundreds of millions of dollars. Further, the rate board’s own actuaries report a sharp decline of 11.5% in the number of auto insurance collision claims in Alberta in 2008. The AIRB actuaries also criticize that premiums for basic insurance have been set too high in every year since 2005.

ACTLA's report, along with reports and submissions from other parties set to make presentations to the AIRB, can be found here: http://www.airb.alberta.ca/public_me....aspx#schedule

[ken0042]

Originally Posted by CaptainCrunch

If it goes up by 40% my insurance goes up by about 528 per year, that's outrageously stupid.

IIRC the 40% increase would only be on the liability portion of your insurance; also know as PLPD. Still a huge chunk, but not 40% of your entire bill.

Listening to QR77 yesterday they brought up the fact that the insurance companies asked for 37% last year and got 5%. Maybe they want 8% this year so they are asking for 40%.