Insurance Industry Says No
To Ontario Government Promise Of A 15% Reduction In Auto Insurance Premiums -
And Ontario Government Falls in Line!
The cozy, behind-the-scenes relationship between
business and government was on full display last week when the vice president
of policy development for the auto and home insurance industry lobby group, the
Insurance Bureau of Canada, came right out and said publicly that the # 1
promise of the 2013 Ontario Liberal budget - a 15% reduction in auto insurance
premiums - simply wasn't going to happen.
Despite legislation passed by the Ontario legislature
that mandates it, the Ontario government’s goal of a 15% reduction in auto
insurance rates is “absolutely not” doable, the Insurance Bureau of Canada’s
Barbara Sulzenko-Laurie said last Tuesday during a panel discussion at the
National Insurance Conference of Canada.
Even more telling are Ms. Sulzenko-Laurie's exact
words uttered publicly at the conference which makes clear that not only is the
industry going to do everything possible to block the promised 15% premium
reduction, but that the government is a full partner in this outright lie to
the Ontario people.
When asked whether the promised 15% reduction is going
ahead, Ms. Sulzenko-Laurie's said:
“Absolutely not, and I think the government fully
knows that although the government has not come out and said it”.
“But certainly in our conversations with the
superintendent of insurance, he’s indicated to us that no one in FSCO (the
Financial Services Commission of Ontario - the regulator of auto insurance in
Ontario) believes that there’s 15% that’s in the system (to be reduced),"
“When we’re talking to the political side (Ministers
and their staff), they don’t admit it, but they sort of smile knowingly in
response to the question”.
So the Ontario government is not going to honour its
promise to 8 million Ontario drivers to cut Ontario auto insurance premiums by
15%. It knows it, the bureaucrats regulating the industry know it, and the
insurance industry knows it.
And the 15% premium reduction was no ordinary promise
- this was the key promise of the 2013 Ontario budget. This was the promise
that allowed the Liberal government to survive because a 15% premium reduction
was the key demand of the NDP for the Ontario budget - the main reason the NDP
allowed the Liberal government to survive another year!
Some background on the issue:
In 2010, the Ontario government slashed statutory auto
insurance benefits that in just one year resulted in $2 billion in savings for
Ontario auto insurance companies.
And predictably, auto insurance profits went through
the roof giving the auto insurance industry some of the best financial results
in years between 2011 & 2013.
Here's two examples of the 2010 benefit cuts:
Example 1: Because of the 2010 changes, the $100,000
maximum for medical/rehabilitation benefits was reduced to $3,500 for minor
injuries (even though many so-called minor injuries are quite significant) and
$50,000 for even more serious non-catastrophic injuries.
Example 2: The $72,000 maximum attendant care benefit
for non-catastrophic injuries was reduced to zero (yes, zero!) for minor
injuries and $36,000 for non-catastrophic injuries.
And it was a direct result of these benefit cuts - and
the subsequent near-record industry profits - that the Ontario Liberal
government made the 15% cut the key initiative in its 2013 budget.
But despite there being a law mandating the 15%
premium reduction, the insurance industry has decided it just isn't going to
happen. And the government, as it often does, has caved to the industry and is
just biding it's time until it can come up with a spin-line that will provide a
lame excuse for why their number one promise to the Ontario people in their
2013 budget, is simply not going to happen.
Want to know what is really happening in Ontario auto
insurance while the industry is crying poor? Read lawyer Alan Shanoff's 3
excellent pieces from the Toronto Sun - the links are provided below.
And then let the Ontario government know what you
think about the government breaking its # 1 promise of its 2013 budget!
*Note: The above was posted on my Face Book page without an author's name included; However, I take it that he or she wanted it promulgated, and so I post it here with thanks.
http://www.torontosun.com/2014/07/26/anti-fraud-bill-a-mirage
http://gerry-stopthebull.blogspot.ca/2014/03/ontario-auto-insurance-premium.html
__________________________________
Relevant Members Addresses
Hon Charles Sousa
http://gerry-stopthebull.blogspot.ca/2014/03/ontario-auto-insurance-premium.html
__________________________________
Relevant Members Addresses
Hon Charles Sousa
Mississauga South
Ministry
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