By: Luke Jones, Published on June 9, 2016 05:15 PM, Last Update on June 21, 2016 11:58 AM
Intact Insurance customers in New Brunswick are likely to be paying more for their auto insurance premiums starting next week, with some paying as much as 7.5 per cent more. The hike in rates is proving to be controversial in the province as the government says Intact has already made a lot of money and should be pushing to lower rates.
However, despite insisting Intact’s premiums will be too high, the province (through the New Brunswick Insurance Board) approved the rising prices, which will also be implemented by Trafalgar. Intact, the largest property and casualty insurer in Canada, says that no customer will pay more than 7.5% above their current rate.
7.5 per cent is still a sizeable rise in cost though and most customer are likely to be outraged if they are presented with such a premium hike. Indeed, many could now leave Intact’s coverage even if they have been generally satisfied with the company and its products. Customers should always shop around the car insurance when renewing a policy, but that practice is doubly important now in New Brunswick.
It is worth noting that Intact also owns Trafalgar and is the second biggest insurance provider in New Brunswick, which means there are a lot of consumers holding policies with the company. Indeed, the changes will affect around 15% of all drivers within the province.
The new prices represent the largest approved premium rise in more than a decade and will affect some 60,000 vehicles in New Brunswick. The public has been represented by Attorney General lawyer Michael Hynes and Toronto actuary Paula Elliott conducted a review showing Intact did not need to higher rates.
In the hearing, Intact lawyer Nadia MacPhee engaged in a heated debate with Elliott, with the province hired actuary saying the company has excessive profit in New Brunswick.
"Just so I'm clear that your position in this application (is) that Intact should reduce its rates," asked MacPhee. "Yes it is," said Elliott.
"By 3.7%? Is that right?" continued MacPhee.
"Based on the assumptions we put forth in our report, the resulting rate level indication was minus 3.7%," answered Elliott.