Maybe public auto insurance is better
If companies selling auto insurance to Ontarians can't make any money doing it, as they claim, we have a question.
Why did they fight so hard against former NDP premier Bob Rae when he tried to introduce publicly-run auto insurance in 1991?
After all, if auto insurance is such a money loser, why wouldn't the industry have been happy to abandon it?
Instead, it launched a massive lobbying campaign to keep auto insurance private -- including the threat of thousands of layoffs -- that forced Rae to back down.
Auto insurers weren't crying poor back then. The Insurance Bureau of Canada boasted that in 1990, the industry had made a $254 million profit, after earlier losses, and that since the business model wasn't broken, why was Rae trying to fix it?
Today, reports say the auto insurance sector lost $390 million last year, although overall profits for all forms of insurance were $2.3 billion. And while insurers cry poor, annual auto premiums for consumers are rising, often at a double-digit pace, in the middle of a brutal recession.
Now, the government of Liberal Premier Dalton McGuinty is considering a plan to slash maximum benefits for accident victims who sustain severe but "non-catastrophic" injuries from $100,000 to $25,000, which critics say is totally inadequate to cover today's costs for medical rehabilitation.
Insurers argue those costs are out of control -- that a claim costing $2,900 to settle in Alberta, for example, costs $38,000 in Ontario.
But where is that $38,000 going? Most of it clearly isn't helping accident victims, but rather funding a wasteful and adversarial system where victims increasingly find themselves at war with their own insurers over the extent of their injuries.
While Finance Minister Dwight Duncan is soon to announce reforms to "fix" the system and the Liberals argue premiums are still 4% lower than when they took office in 2003, that's cold comfort to consumers facing double-digit increases.
Indeed, it's hard to see how a public system could be any worse than what we have. Food for thought, premier?
Source: SUN MEDIA First posted: Wednesday, July 22, 2009 03:50 AM EDT | Updated: Wednesday, July 22, 2009 03:51 AM EDT
torontosun.com/comment/editorial/2009/07/22/10215506-sun.html
If companies selling auto insurance to Ontarians can't make any money doing it, as they claim, we have a question.
Why did they fight so hard against former NDP premier Bob Rae when he tried to introduce publicly-run auto insurance in 1991?
After all, if auto insurance is such a money loser, why wouldn't the industry have been happy to abandon it?
Instead, it launched a massive lobbying campaign to keep auto insurance private -- including the threat of thousands of layoffs -- that forced Rae to back down.
Auto insurers weren't crying poor back then. The Insurance Bureau of Canada boasted that in 1990, the industry had made a $254 million profit, after earlier losses, and that since the business model wasn't broken, why was Rae trying to fix it?
Today, reports say the auto insurance sector lost $390 million last year, although overall profits for all forms of insurance were $2.3 billion. And while insurers cry poor, annual auto premiums for consumers are rising, often at a double-digit pace, in the middle of a brutal recession.
Now, the government of Liberal Premier Dalton McGuinty is considering a plan to slash maximum benefits for accident victims who sustain severe but "non-catastrophic" injuries from $100,000 to $25,000, which critics say is totally inadequate to cover today's costs for medical rehabilitation.
Insurers argue those costs are out of control -- that a claim costing $2,900 to settle in Alberta, for example, costs $38,000 in Ontario.
But where is that $38,000 going? Most of it clearly isn't helping accident victims, but rather funding a wasteful and adversarial system where victims increasingly find themselves at war with their own insurers over the extent of their injuries.
While Finance Minister Dwight Duncan is soon to announce reforms to "fix" the system and the Liberals argue premiums are still 4% lower than when they took office in 2003, that's cold comfort to consumers facing double-digit increases.
Indeed, it's hard to see how a public system could be any worse than what we have. Food for thought, premier?
Source: SUN MEDIA First posted: Wednesday, July 22, 2009 03:50 AM EDT | Updated: Wednesday, July 22, 2009 03:51 AM EDT
torontosun.com/comment/editorial/2009/07/22/10215506-sun.html
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