New Brunswick auto insurers seek largest rate hikes in 16 years

Excerpted article as written by Robert Jones · CBC News

A group of New Brunswick’s largest automobile insurance companies is applying for the steepest rate hikes in 16 years.

But bigger bills won’t be hitting drivers until weeks after New Brunswick’s provincial election at the end of the month — making the topic unlikely to rile up voters like it has in previous campaigns.

“Increases will be significant,” said Michele Pelletier, New Brunswick’s consumer advocate for insurance.

“They say, ‘OK, we’re having some really big losses,’ that’s what they’re telling us and they’re asking for bigger increases.”

Rising auto accident claims in New Brunswick, in part caused by more generous government rules around what accident victims can claim compensation for, has turned the province from what used to be the most profitable jurisdiction in Canada for auto insurance companies — into one of their most troublesome financial sinkholes.

According to Canada’s General Insurance Statistical Agency [GISA], auto accidents in New Brunswick generated $376.9 million in claims in 2017. That’s a $144 million — 62 per cent — more than five years earlier with no increase in premiums to pay for it.

GISA numbers show between 2012 and 2017 the average premium paid by drivers in New Brunswick actually fell 53 cents to $803.15 per vehicle.

Pushing drivers to pay more

Pelletier said it was only a matter of time before companies started pushing for drivers to pay more.

“None of us want to have higher premiums. I’m the first one to say I’m paying enough,” said Pelletier.

“But there were signs, we could see signs.”

The New Brunswick Insurance Board is starting to hear applications from insurance companies seeking rate hikes to deal with surging claims costs. (CBC)For insurance companies, surging claims crashing into stagnant premiums has splattered red ink all over their New Brunswick business and sent them speeding to the province’s regulator — the New Brunswick Insurance Board — to apply for higher rates.

Next month the board will hold hearings into an application from New Brunswick’s largest auto insurance company — Wawanesa — to raise its premiums on more than 85,000 provincial policy holders by an average of 11.7 per cent. This includes increases of 17 per cent of about 30,000 of those drivers.

The company wants approval to begin charging new customers elevated prices on Jan. 1, and then pass the increases onto existing customers throughout next year whenever drivers’ current policies come up for renewal.

Pelletier and the province’s Office of the Attorney General are both intervening in the Wawanesa hearing on behalf of consumers, but it will be an uphill fight to derail the application.

Low auto insurance rates

New Brunswick has some of Canada’s lowest auto insurance rates, 30 per cent less than in Alberta and more than 40 per cent cheaper than in Ontario.

In a hearing into an eight per cent rate hike application by the Dominion of Canada General Insurance Company earlier this summer, Pelletier and the Office of the Attorney General both intervened and then withdrew when it became apparent the increase was justified.

Former premier Bernard Lord won a narrow election victory in 2003 after widespread anger over skyrocketing insurance premiums became a campaign issue. (Adrian Wyld/Canadian Press)In a ruling two weeks ago the Insurance Board granted Dominion’s application in full.

But Wawanesa and Dominion are not alone.

Economical Insurance, which covers more than 44,000 of New Brunswick drivers, has applied for a 14 per cent increase on 38,000 of those customers with lesser increases for the rest.

Allstate, which covers 33,000 New Brunswick drivers, has applied for an average rate increase of 9.9 per cent on its customers for the second year in a row.  That includes 15 per cent increases on 5,000 of its policy holders.

Pembridge has also applied for an average 9.9 per cent increase on its 17,000 New Brunswick clients with Aviva asking for 10 per cent increases on roughly 14,000 of its more than 25,000 provincial policies.

The province has not experienced auto insurance increases of that size since 2002 and 2003 when rising accident claims last triggered major premium bumps.

Widespread public anger nearly toppled Bernard Lord’s government in the 2003 provincial election.


Distracted Driving Statistics – What to Believe?

Stop Distracted DrivingI received an interesting fact sheet from the Traffic Injury Research Foundation (TIRF) this week. It looks at distracted driving related fatal collisions in Canada from 2000 to 2015. In some Canadian provinces this type of fatality has surpassed the total caused by alcohol impaired driving. However, that’s not the part of the document that made me pause.

Distracted driving to many means the manual use of a cell phone while operating a motor vehicle. In reality, distractions include being engaged with entertainment or communication devices, engaging with passengers in the vehicle, or eating, smoking or personal grooming while driving, among other examples. Doing anything that takes the driver’s attention from the driving task could be considered as distracting.

This caveat in the preface to the report was what really captured my attention:

It should also be noted that in some collision report forms, investigating officers may code the driver condition as ‘distracted, inattentive,’ meaning there was a general lack of attention exhibited by the driver but there was no specific source of distraction identified.

To me, distracted and inattentive are two different things. Lumping them both together does not paint a true picture of the problem.

Collision data gathering can be a complicated task. In order to be reliable, it must be done promptly, carefully and thoroughly by investigators who gather as much data as possible, considered for accuracy and then reported in a consistent manner.

That was on the minds of the people who produced the TIRF report:

Fatality data from British Columbia from 2011 to 2015 were not available at the time that this fact sheet was prepared. As a result, Canadian data presented have been re-calculated to exclude this jurisdiction and make equitable comparisons.

This politely worded statement could mean many things. TIRF did not give adequate time between the request for data and the writing of the report. It takes more than 3 years for B.C. bean counters to determine a result. B.C. refused to share the data with TIRF. Worst of all, maybe B.C. really has no idea what that data is.

Our government chose to discontinue the requirement to report a collision to the police in July of 2008. Currently, ICBC claims personnel are the only ones in a position to gather the majority of collision data.

If we can’t share data with TIRF, can we be sure that what we are being told about the impact of distracted driving is true?

No doubt it is taking place as the police issued about 43,000 tickets for using electronic devices while driving last year and we know that the consequences of doing so can be terrible, but how many of the 960 collisions that happen each day in B.C. can be blamed on driver distraction?

Cst. Tim Schewe (Ret.) runs DriveSmartBC, a community web site about traffic safety in British Columbia. For 25 years he was an officer with the Royal Canadian Mounted Police, including five years on general duty, 20 in traffic and 10 as a collision analyst responsible of conducting technical investigations of collisions. He retired from policing in 2006 but continues to be active in traffic safety through the DriveSmartBC web site, teaching seminars and contributing content to newspapers and web sites.

#DriveSmartBC: A Different Approach to School Zone Safety

Seven years ago I wrote about a safe trip to school, commenting on my experience that a significant part of the safety problem was caused by teachers and parents themselves. Their driving behaviour as they showed up to work or dropped off their children sometimes left a lot to be desired. Did they not realize that they were creating their own problem?

At that time, the only solution that I had to offer was the walking school bus. This is where parents take turns walking the neighbourhood group of children to school. Everyone benefits from the exercise, the children are safer and traffic congestion at the school is reduced.

We know that there’s a problem, but how do we deal with it? The City of Toronto is trying an Active and Safe Routes to School pilot project as a part of their Vision Zero Road Safety Plan. This will see areas around schools being designated as Community Safety Zones.

These zones will see painted crosswalks, active speed reader signs. increased enforcement and higher penalties.

Of the four, the only one that I know for sure results in a measurable effect is the speed reader sign. It’s always there and working.

Do the police have the resources to maintain an enforcement level necessary to result in a lasting level of compliance? Would we accept automated enforcement in school zones? The current political climate in B.C. seems to indicate that it is possible, but as yet nothing has been implemented.

Vienna Austria, Bolzano Italy and Haddington Scotland have taken a different approach. They have decided to exclude motor vehicle traffic around primary schools. Vienna’s closure is at the start of the school day, with Bolzano and Haddington at the beginning, lunch hour and end of the day.

These are pilot projects for Vienna and Haddington, but Bolzano has had this program in place for 21 years. Bolzano found that traffic jams are reduced and safety has increased, reducing the collision rate by half, resulting in about 45% of students walking to school.

Traffic calming measures lie somewhere in between. Here are some examples from the Netherlands. The use of signs, coloured pavement, marked crosswalks and chicanes are markedly different from what is found here in B.C.

ICBC says that every year, 380 children are injured in crashes while walking or cycling and six are killed throughout the province. In school and playground zones, 86 children are injured. Read their full press release.

The Insurance Bureau of Canada says the auto insurance industry market has deteriorated significantly over the past few years due to rising claims costs.

Read more

September is Distracted Driving Awareness Month. #EyesForwardBC #DriveSmartBC

Read more

ICBC reports ‘high volume’ of claims after acid spills on B.C. highway

TRAIL, B.C. _ A major mining company has apologized after two acid spills earlier this year damaged a large number of vehicles in southeastern British Columbia.

Teck Resources says the two spills of sulphuric acid happened on April 10 and May 23, along a busy commuter route in Trail, after the company sold the acid and it was being moved.

In the first spill, about 220 litres of acid leaked as a truck travelled a 16-kilometre stretch of highway, and in the second, about 70 litres dripped from the truck over six kilometres along the same route.

Teck says both spills were cleaned up, no acid seeped into area waterways and there is no damage to roads or bridges.

But the Insurance Corporation of B.C. says it is dealing with “an extremely high volume of claims” from vehicle owners.

It has set up a dedicated phone line for drivers who may have travelled the road and an adviser who answered the line says the acid has the potential to corrode vehicle undercarriages, especially brake lines and brake systems.

Teck says the spills are unacceptable and the company is “working with the parties involved in acid transportation to prevent any recurrence.”

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