By: Luke Jones, Published on September 19, 2017 09:51 AM, Last Update on September 19, 2017 06:52 AM
The Insurance Bureau of Canada (IBC) says it supports the decision to review the auto insurance market in Newfoundland and Labrador. The review was implemented after insurance companies in the province said they are losing money because of rises in claims frequencies and payments.
Newfoundland and Labrador already pays the most expensive car insurance premiums in Atlantic Canada and companies will need to raise premiums to keep pace. Amanda Dean, IBC’s Atlantic region vice president, says the review is in the interest of customers as rising claims means insurers will raise premiums:
“I know nobody’s losing sleep just because an insurance company is losing money in Newfoundland and Labrador, but it’s what happens when those companies lose money,” says Amanda Dean, IBC’s Atlantic region vice-president. “They’re forced to make tough decisions.”
Some companies may pull out of the province entirely, which would leave fewer choices, warns Dean. She suggests looking to neighbours in the Atlantic Canada regions. In Nova Scotia, drivers pay around $300 less on average for their auto insurance coverage.
The IBC says it welcomes the review into the market and wants to see reform introduced that will help to lower premiums. Such reforms will need to keep the market competitive by keeping companies in the province, but also help customers by lowering costs. It is perhaps a tough challenge, make more money for the companies, but help the customers to pay less.
“It’ll be interesting to see where we land and even just taking a jurisdictional approach and looking at what’s happening in other provinces and coming up with a Newfoundland and Labrador-based solution, it’s an incredibly smart process that we’re really looking forward to,” Dean said.