INDEPTH: INSURANCE
By the numbers
CBC News Online | October 15, 2003
Source: Statistics Canada | Released Sept 21, 2003
AUTO INSURANCE
From July 2003 to August 2003, 2% increase in automotive insurance premiums
Comparing Aug 2002 to Aug 2003
National average increase: 21.8%
NF: 33.9%
PEI: 18.3%
NS: 12.8%
NB: 23.2%
Que: 17.6%
ON: 30.8%
MB: -0.7%
SK: 3.9%
AB: 24.3%
BC: 7.3%
Whitehorse: 14.2%
Yellowknife:- 5.6%
HOMEOWNERS
From July 2003 to August 2003, 2.2% increase in homeowner's insurance premiums
Comparing Aug 2002 to Aug 2003
National average increase: 11.8%
NF: 4.0%
PEI: 9.8%
NS: 4.4%
NB: 2.7%
Que: 15.1%
ON: 15.1%
MB: 4.1%
SK: 6.1%
AB: 5.1%
BC: 5%
INSURANCE IN GENERAL
- Canadians spend almost $50 billion on insurance annually, according to combined statistics from the Insurance Bureau of Canada and the Canadian Life and Health Insurance Association.
- It's the fifth-largest expenditure a family makes, according to Statistics Canada
- According to Statistics Canada, auto and home insurance premiums rose 26.3 per cent and 6.7 per cent respectively in the year ending April 2003.
- A number of factors have been cited for the rate hikes.
1. One of the most commonly mentioned is the fallout of the September 11, 2001, attacks on the United States. Insurers and re-insurers worldwide have had to recoup more than $40 billion in insured losses from that day.
2. Another factor is the economy. Because insurers invest heavily in the stock market, the economic downturn has meant lower returns, leaving them short on funds.
3. Industry experts, however, say the number one factor is a rise in the value of claims filed for personal injury and rehabilitation. According to the Insurance Bureau of Canada, medical claims have risen between 10 and 15 per cent each year since 1998. And many of them are fraudulent.
KINDS OF INSURANCE
- "Property and casualty" insurance (also referred to as "general" insurance). Includes automobile insurance, property insurance (insurance for homeowners, condominium owners, and tenants), as well as a variety of commercial and business insurance. An important component of all of the property and casualty lines is liability insurance, which provides protection for an insured person who accidentally injures someone or damages someone else's property and is legally bound to pay for the damage.
- "Life and health" insurance, (over 100 life insurance companies operating in Canada deal with this). Another aspect of health insurance, disability insurance, pays for income lost due to a disabling injury or illness. Often, life, health, travel medical, and disability insurance is provided through employers, but it can also be purchased by individuals.
- The problem with '"no fault" insurance is that both parties in an accident are compensated equally, and there is no way for example to sue a drunk driver who runs you over.
CO-OPERATIVE VS. PRIVATE CAR INSURANCE ACROSS THE COUNTRY
A breakdown of province-by-province car insurance information, including who pays, whether you can sue, etc.
BC - Government provides basic coverage; government and private companies compete for excess. You can sue for pain & suffering and economic loss.
YK - Private insurers provide coverage. You can sue for pain and suffering and economic loss.
AB - Private companies. provide coverage. You can sue.
SK - Government provides basic insurance, Government and private competition for excess. You can't sue for pain and suffering, you can sue for economic loss up to $52,000 per year
NU/NT - Private. companies cover. You can sue.
MB - Government provides basic insurance, Government-private competition for excess. Can't sue.
ON - Private. companies cover, can sue for pain and suffering and economic loss up to certain limits and under certain conditions. Ontario has a form of no-fault insurance, which has been criticized as being an imperfect compromise.
QC - Government covers personal injury, Private companies cover property damage. You can't sue. No fault system (though the current Justice minister is looking into changing that the system) NB Private cover, can sue.
NS - Private coverage, you can sue
PEI - Private coverage, you can sue.
NF - Private coverage, you can sue.
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