Political silence on car insurance

A new Fraser Institute study confirms what Ontario car drivers know.

We pay the highest auto insurance premiums in Canada, an average of $1,281 annually in 2009, the latest year for which figures are available.
The fact this isn’t a huge election issue shows how out of touch the Liberals, Tories and NDP are with voters. That said, we disagree with the Fraser Institute’s view — constantly echoed by the insurance industry and Queen’s Park — that the main culprit in high rates is insurance fraud.
As Sun Media legal affairs analyst Alan Shanoff has documented in a series of columns, while fraud is one problem that must be addressed, it has been absurdly over-hyped by insurers and government in explaining ever-rising insurance premiums. Indeed, industry and political estimates of auto insurance fraud are all over the map, ranging from $1.3 billion annually for Ontario alone — a figure that has been thrown around for 20 years — to less than half that for car, home and business insurance right across Canada, suggesting auto insurance fraud is a much smaller factor in setting rates than we’ve been told. Meanwhile, with the provincial government’s approval, Ontarians are paying ever higher premiums for ever less basic coverage — all in the name of a supposed war on “fraud” that never seems to produce any results that benefit consumers. Worse, many honest Ontarians are finding their high-priced coverage not only inadequate, but not there when they most need it — after a serious car accident. Court cases have revealed genuine claims being denied and disputed for years by the insurance industry, who pay doctors hundreds of thousands of dollars annually for medical opinions that, unsurprisingly, agree with the insurers. The bottom line is with the blessing of Queen’s Park, including the current Liberal government, premiums are up, basic coverage is down and even that coverage is too often denied when a genuine claim is made, resulting in accident victims waiting years for compensation, while being denied the rehabilitation they need and becoming increasingly depressed. Yes, fraud must be eliminated. But so too, must the too-cozy relationship between the industry and Queen’s Park, which is going to be an issue no matter who wins on Thursday.

source: Alan Shanoff, torontosun.com