INDEPTH: INSURANCE
Your Response: E-Mails to The National
CBC News Online | October 16, 2003
Some samples of the e-mails Canadians sent to The National asking for questions and complaints about insurance.
When talking about car insurance rates, the Saskatchewan Government says we have the lowest. I do not think they are taking into account the deductible and the bang for the buck. Our rates may be cheaper but our deductible is $750.00 and there is almost no coverage with that. I wonder how that stacks up with the rest of the country.
Micky Kelly | Moose Jaw
It seems everybody has their own horror story about car insurance or they know someone who has been similarly affected.
My car insurance for a driving school I owned last year doubled for no reason...there were no tickets/no accidents/no incidents of any kind to warrant an insurance increase .Yet it went up 100%.
I called to insurance company to find out why and was told..."that's just the way it is." I operated the same driving school here in Orangeville for 18...yes (eighteen) years with no accidents and no driving infraction. I no longer have a driving school and that is definitely one of the reasons why.
At the time I realized that I did not have anyone I could complain to that made any difference. I could not complain to the Insurance company, I could not complain to the police, and I could not complain to the government. In my mind that meant that I was being subjected to a form of extortion.and that the insurance companies now were doing with legislation what Al Capone used to with baseball bats...namely plain and simple extortion.
There are laws in place that everyone who drives must have insurance and the insurance companies set the price of insurance.
That is akin to having a business selling tomatoes ...getting the government to pass laws that everyone must buy a tomato and leaving the vender to set the price. Make no wonder the price of insurance is going up... they (the insurance companies) have no motivation whatsoever to constrain themselves, knowing that any time they want they can simply raise the price to cover anything that comes their way in the form of any kind of administrative obstacle.
The way it stands now a person's insurance can damn near double if you get a speeding ticket and the fact that you have had 35 years of accident free driving won't make a damn bit of difference...and when that happens to you there is no one to complain too.. It does no good to complain to the Government... it does no good to complain to the police ...and it does no good to complain to the insurance companies.
A common remark among people that I socially talk to about this is..."they have to be stopped"... and this is a fairly common train of thought....and I agree 100%. Someone has to do something, and the only ones that can help the general public on this issue are the elected representatives of the people.
Something has to be done...now insurance is so expensive for some that more and more people are driving without insurance. Cars are being written off especially older cars that can be easily repaired ...but the insurance companies know they can make more money writing off the car and charging exhortative rates on the next car the same person buys after accident.
God forbid that some poor soul gets a ticket in a school zone...I fear that the subsequent cost would be extremely prohibitive. The cost of the ticket now in a traffic violation is nothing compared to the cost of your insurance afterwards...I think those insurance companies are using every possible leverage they can get their hands on as an excuse to raise a person's insurance...the most alarming thing about the whole thing is that there is absolutely no one that you can complain too about it. That is the most frightening part. It wouldn't surprise me to hear soon that someone's insurance has been increased on account of a parking ticket or because you were found to have left their window down in a parking lot. I hope the news media in this country can take it upon themselves to expose those insurance companies for what they are ...extortion artists... just as the media exposed Al Capone in the twenties in Chicago.
Walter Lane | Orangeville, Ontario.
The Insurance Corporation of British Columbia (ICBC), which by no means has the highest auto insurance in Canada, especially when compared to provinces that have private insurance, still has some explaining to do regarding its planed fee increases for January, 2004, even though its net income is up $68 million compared to the same 6 month period of last year.
In addition, when researching ICBC's finances, one must wonder if they are a Crown Corporation providing car insurance, regulated by the provincial government, or an investment firm protected by the B.C. government.
Right now the firm has an investment portfolio two and a half times larger than its annual insurance premium revenues. That's right, a $6-billion portfolio, compared to annual premium revenues of approximately $2.5 billion.
The catch phrase that ICBC uses to substantiate increases in insurance premiums is, according to an ICBC spokesperson, "Reserves are below a level that our financial people feel comfortable with." But, correct me if I am wrong, are not their reserves their investment portfolio.
ICBC executives are quick to point out that when they do have losses they can be huge, such as the $250 million loss in 2001, which necessitates such increases and reserves.
However, a quick review of those financials shows that $171 million of that loss was due to a poor performance of their investment portfolio in money markets, bonds, equities, and venture capital. Furthermore, another $90 million of the 2001 loss was attributed to non-insurance operations, which would mean their total non-insurance activities created a $261 million deficit, and their insurance premiums actually reduced their net loss by $11 million.
I am betting that this new round of increases has little to do with car related insurance costs, and more to do with stocks that have tanked on ICBC, such as their $150 million stake in Air Canada, to name but one of the dubious performers in their portfolio.
Jamie Yavis | Surrey
While I can't claim to know much about any other type of insurance, I
can relate with surety the position my roommate is in with his car
insurance, for I have watched the mockery of a dance the Provincial
government of B.C. calls "insurance".
In B.C., they have a graduated licensing system, which is not that
strange. Unfortunately, the open policy is that anyone who has their
second level of license (they've taken their first driving test and
need to wait 2 years to take their final) is automatically in the
wrong. No matter what. No matter the incompetence, motivation,
carelessness, lack of skill or attention the other parties may
possess.
How is this to cause people to have faith in their government-run
cash cow later on if new drivers (keep in mind, this could mean new
to BC, and often does in Vancouver) are treated like criminals by
default?
In the case of my roommate, he took a BC driver's test and drove with
the green "N" sign that all new drivers are forced to display.
(Though since it must be displayed in the rear, I can't imagine what
purpose this serves except as a possible quick braking warning.) He
was in 2 fender benders; once cut off by a speeder and once sliding
into a car which braked on slick asphalt in the middle of an
intersection for no reason.
The Insurance Bureau of British Columbia (ICBC) told my roommate that
if he paid for the damage done to all the cars in both accidents (5
in total), they would *consider* lowering his insurance.
Pardon me, but is insurance the not very reason one pays beforehand
in monthly increments? Is that not what the very word - "insurance" -
means? What is the purpose of paying insurance if you're forced to
pay for all damages anyway? And then be forced to pay as usual?
So, for 2 accidents whose faults were minor and questionable, ICBC
now demands he pays $14,000 a year for insurance - $1,000 less than
the entire cost of the car.
In this case, however, we already know that the government does not
want its residents driving. Considering the added cost of overtaxed
gas, this is, simply put, one more way to insure only those with the
greatest amount of money are welcome here. …
BC is already famous for its lack of concern for any but its
wealthiest citizens. And considering the lack of motivation the
people here seem to feel about everything, it doesn't look like it's
going to change anytime soon.
It's enough to make a person want to move to Alberta.
Tiffany Fox | New Westminster, BC
What rising rates?
My 2001 - 2003 home insurance (ING Novex) $307, $309, $319
My 2001 - 2003 basic car insurance (including registration fee), 2000
Saturn, ICBC: $821, $748, $772.
David J. Truman | Langley, BC
This may seem to be out in left field somewhere, but does
the change in designation of a married couple affect the payments that
insurance companies will have to make in their benefit programs? It seems
to me that this issue has more of an economic impact than a moral one.
Bob Wakulich | Cranbrook, BC
We are from a small community in southwestern BC that is not protected by a
fire department. Our homeowner's insurance policy went up by 6% last year
and now and additional 10% this year. We now pay in excess of $1000 per
year for fire, theft and liability insurance on a property that has a market
value of $150,000. Most motor vehicle insurance costs at least $1000 to
ensure a car that may not be worth much more than that. We are self
employed in a weak economy and I don't know how we are going to be able to
keep up with these costs.
Kathy Gray
You said on the National, that you wanted the thoughts of Canadians in rising insurance premiums, well, I put my thoughts in a poem.
Premium Reflections
Canadians have to give out more monies,
to the hungry insurance companies,
so they can refill their wallets,
to cover their loses on the markets.
I wish that my elected government,
would see, that our dissolved earnings received enough punishment,
and put a quick and abrupt end to this
sucking the few coins left in my pocket business.
Tumbling premiums, in our policies.
Without help, we will never see.
Because lower prices, does not fit well with thee,
It's in the ACT OF GOD category.
hehehehhehe those are my thoughts, hope you liked, I enjoyed.
Pierre Dionne | Temiscaming, Quebec.
The insurance industry has been justifying the rising cost of auto insurance by placing blame on the cost of claims. This may be true to a point but let us properly identify the real reason and the true culprit.
The auto repair industry has been largely blamed even though it has been responsible for an extremely minute increase in labour rates. Parts prices and suppliers are being dictated by the insurance industry.
This leaves the real reason for out of control raises in insurance rates.....a result of the combined actions of the legal system, the legal profession and the greed of the insurance industry. The insurance industry wants to increase profits; the legal profession wants to increase profits; and the legal system is so out of touch with reality that it just confuses the whole situation and takes the easy way out by awarding large, undeserved settlements.
Edwin A. Sailes | Onoway, Alberta
Having lived in both BC and Ontario, it is clear in my circumstance that the public system run by ICBC is more expensive than Ontario's private system. At 28 no claims for 7 years or tickets for 9, to insure a Jeep in ON is aprox $1000 a year, full coverage. BC for the same machine is $1700, with a 25% discount. Warning for those moving to BC, even if you can prove no claims for the equivalent 40% discount, ICBC will only give you 25%. A clear cash grab. The huge insurance kicker I find is motorcycle insurance. In BC I pay $1400 a year for basic $200,000 coverage, fire and theft. Almost 20% the initial cost of the same bike I have had accident free for ten years. I cannot comment on buildings falling in the US and how they affect the world insurance market, nor do I have access to statistics that could legitimize the rates that ICBC charges, but clearly there needs to be consumer protection across the board in Canada when the issue of insurance creeps so closely into our daily lives in so many ways: auto, home, belongings. If world events are going to affect us this way, maybe its an issue for Ottawa to regulate this industry since it appears the provinces are incapable of developing a fair and reasonable system from province to province. And yes, this clearly is an issue that could sway my vote.
Marcus Robb | North Vancouver BC
Thank you for this opportunity to voice an opinion on the high cost of insurance in Ontario.
As a middle-income family (who all have excellent driving records) with 2 moderately priced vehicles, some recreational equipment and a homeowner's policy we pay a whopping $4000.00 per year in general insurance.
This is the best cost we could find after weeks of quotes and research. Some benefits had to be sacrificed such as lower deductibles (under $1000.00) and glass coverage on one of the vehicles. We've been told by friends this is actually a good rate compared to what they are paying.
Car ownership is un-attainable for my 19-year-old son as the annual premium is more than the cost of a reliable car. As an occasional driver on our policy he is rated on the higher cost vehicle thus doubling the cost to insure it. Until the age of 25 he is guilty until proven innocent of having a bad driving record.
Small business people are struggling to keep the doors open with the double wham of premium increases and the high cost of energy.
Insurance companies say that these premiums are necessary to defer the cost of claims that cause them to be barely profitable. The truth is that some bad stock marked investments were made with our premiums during the last three years and those companies have passed this cost onto us.
I hear a great deal of fear mongering coming from the industry regarding converting to a public system similar to other provinces.
They claim "The roads will be unsafe as too many bad drivers will be eligible to drive" and "Public insurance cannot deliver the same quality of claims resolution as private companies". I have friends and relatives in those provinces who say these and other statements are unfounded, and their rates are half what we pay.
A serious threat of a public insurance system for Ontario needs to be cast upon the industry to bring some reality in the pricing of these over inflated premiums. Another solution is allowing the establishment of regional insurance co-ops.
If we are to keep inflation under control and promote re-investment in our businesses and communities we need to say NO! to this huge money grabbing machine and deny the well paid insurance lobbyists the clout they now enjoy at Queens Park.
John Spencer | North Bay Ontario
In response to your request for insurance stories on Tuesday night, here's mine:
In 1999, I moved from Montréal to Toronto, and my car insurance jumped
by a factor of 10. I went from paying $300 a year for a 1989 Hyundai
Excel to unaffordable quotes of $3000 to $5000 a year for the same
insurance on the same car. I was forced to give up my car, and now
there's no going back since my Québec driving record is too old. I don't
think I will ever be able to afford new driver insurance rates in
Toronto, and therefore I will never be able to afford a car.
Most people I know lie to their insurance companies to get a cheaper
rate. They use the address of a cottage, friend, or relative outside
Toronto, which generally drops their rates by a factor of 3. Lying about
yearly mileage is also common. I don't think I've talked to anyone who
tells the whole truth to their insurance companies.
Yannick Trottier
I am a small businessman about to open a shop in Ontario. For over a month I have been trying to obtain liability insurance, a condition of my lease, and have found it completely impossible. Most Insurance firms never actually get back to me, and some have candidly stated that it will be impossible because of the "state of the industry" at the moment. I even went so far as to call the Government Small Business Help Center and was told that it was "out of their hands". I informed them that the inability of small entrepreneurs to open a business because of the reluctance of licensed Insurance brokers should very much be a concern of any Government, as it is fundamental to the economic fabric of our society.
I am absolutely certain that there are a great deal of motorists driving without car insurance - Likewise I have the decision of opening my shop without liability insurance, or simply not going into business. It must be plainly obvious to any rational thinking person that the Government in Ontario has to take over the Insurance industry. They are simply not doing the job.
Neil MacMillan
I recently moved from BC to Ontario for school reasons. When my girlfriend and I purchased a car and received a quote from an insurance company for auto insurance and my yearly rate nearly doubled, around $1400 per year in Ontario from the approximate $850 I was paying in BC (with a 40% discount due to my good driving record). I have been told that my insurance is high in Ontario only because I am a male and under the age of 25. Even though my 7-year driving record shows me to be an excellent driver, I have been nonetheless unjustly profiled as a young and dangerous driver even though my record says otherwise. It seems that the public auto insurance in BC is better as they have better control over their rates, plus I am given lower insurance rates every year for my good driving record and not unjustly profiled as dangerous like they do in Ontario with private auto insurance.
I have One question, why is there such a gap between the cost of auto insurance in a public and private system? Is it just a difference in profit margins, or is it something else or is it a combination of things?
Len Vaness
I have been driving for 27 years, as has my wife...both accident-free,
ticket-free, etc. Our insurance has doubled in 2 years. We went from
$65/month in 2001 to $95/month in 2002 to $130/month this year. Earnie
Eves says he'll get it reduced by 15% (even though HIS government has
approved all the increases) and Dalton McGuinty by 10%. Big deal! What
we need is leadership with the gonads to say no to these crooks, and if
they can't provide the service for a reasonable price...then let's get
on with public-owned insurance.
My son, who is 20 and just getting his licence, was quoted $5000/year to
insure a $6000 1999-2000 Pontiac Sunfire, even though he has his Young
Driver's training. How can a young person afford these kinds of rates?
Somebody on Bay Street should be locked up over this hostage-taking. The
government passes laws requiring us all to buy insurance, then their Bay
Street backers rape us with insane rate increases. What a scam! I hope
Ontario voters remember Earnie's government's approval of these
exorbitant increases when they go to the polls, and that somehow we end
up with government-run insurance when all the smoke clears.
Graham MacPherson | Prescott, Ontario
My husband and I recently received our renewal for our homeowner's policy and were stunned to see that our premiums would be going from $88/monthly to $117/monthly! An increase of $30 a month! It was only after calling several other insurance companies that we discovered not only were we being subjected to a huge increase (with no explanation at all) but we had also been paying about $25 more a month than four other companies quoted us. Not only did we switch companies but our company did not seem to care in the least that they had been over charging us almost $300 a year for the past 8 years and that we were going to be cancelling our policy after 9 years. No apology, no explanation, no effort to retain us as customers! Now my husband and I have to try to swallow the fact that we paid out approximately $2400 more in insurance premiums than we needed to . Hard to swallow when you're raising three children on a middle class income! I still cannot explain the "sudden" increase in our premium and I was stunned that no one at the insurance company felt it was necessary to do so either. By the way, the yearly cost of our insurance was going to be $1245 for a $120,000 home with $1,000,000 liability. Now we are paying $680 for the same thing with $2,000,000 liability.
What gives?
Julie Soule | Belleville, Ontario
Rising cost of Insurance:
In October 2002 I was involved in a car accident. My husband was fine. I broke my wrist and was off work for 6 weeks because I broke my right hand and I'm right handed and I could not work. The front end of the car resembled an accordion. It was the first time in the 20 or more years that I had ever been involved in an accident. Now my insurance rates went from $108.00 per month to 281.00 per month. I've tried getting cheaper insurance now I'm told by another insurance that the cheapest I'll be able to find is the one being offered by my current insurance company. Why? They made money off me all those years!!
Yvonne Penney | Toronto
I'm in Fredericton, NB and in the past 2 years, my insurance has risen from $864 to $1115 and that is after I raised my deductibles and that is without any claims against my policy. Our government almost lost the election over it and they still do not seem to be that willing to do anything about it but keep putting it off. New rates were to be submitted to the Public Utilities Board by Aug. 15. I called my company and they stated that they did submit new rates...the same ones as they had before as they felt that the rates they previously had were very reasonable.
As far as I am concerned, we would have nothing to lose by switching to a public insurance system and kicking the private companies out of the province. After insurance companies are dealt with, the focus should be switched to the gas companies and the gouging they have been doing over the past several years.
Greg Jardine | Fredericton, NB
Health insurance for my daughter, my husband and myself rose in 2003 in BC from $850/year to $2,500/year. At the same time our joint income did not go up. No one talks about the growing separation between those that can afford health care and those that cannot.
Lynne Milnes | Victoria
My dad's insurance rates last year were around $157 a month, I got into an accident, and ICBC said I was 50% at fault. When my dad went to renew his insurance they told him he was going to have to pay almost $500 a month. Who can afford that? Accident or no accident, that is an extortionate amount. Something needs to be done about insurance rates, normal people who need their vehicles to get to work cannot afford insurance.
Haldis Boisvert | Surrey B.C.
I'm a 23 year old, recent university graduate and I am looking for my first
car.
I shopped around a bit, got a consumer reports book and then narrowed my
search down to two different cars. A Toyota Corolla and a Honda Civic. Both
were basic vehicles with good track records and nice looks. I decided to
lease the vehicle I would select and so I inquired both dealerships as to
these prices. The Honda was around $300 a month and the Toyota $330. I was
pleased with these numbers and thought I was on a good track to getting the
car in the next few weeks.
Little did I know that my insurance cost would end up being almost as much
as the entire lease payment per month. That means twice the cost! Since then
I have done more shopping with insurance companies than I put into searching
for the actual type of car. Unbelievable!
I realized insurance rates were bad for my age group, but I had no idea they
were this high. Long story short I am planning on going with a group rate
and have got my insurance cost down to around $220 a month. This is still
outrageous, but there is nothing I can do.
In my opinion, the government should not begin their own insurance program.
This is a bad idea! The government cannot run a business and should get out
of the existing businesses it has left. I think that perhaps by cracking
down on the fraudulent claims that seem to be crippling the insurance
industry right now, that that would solve the problem. But I'm not an expert
on the whole industry. What I do know is that I'm just starting out my
career and this is a cost I'd like to see reduced.
Impoverished by insurance,
Dan Parker | St. George, ON
I am the executive director of the Automotive Service and Repair Association of Alberta, the trade association for collision repair shops.
In this job I spend much of my time fighting and lobbying insurance companies.
I also spend a lot of time researching the business practices and profitability of Insurance companies.
Collision shops are concerned about the pressures that Insurers are bring on government. Many of their arguments are valid and many of the areas of concern they highlight (tort abuse) need reform. However, care must be taken to ensure that Insurers also improve their business practices and don't use their new found political clout to mandate changes that will improve their profitability at the expense of the consumer and of related industries.
Victor Marciano, Automotive Service & Repair Association | Edmonton
I am writing in response to the invitation by Peter Mansbridge to
contribute information to the new segment on insurance CBC is currently
working on. I appreciate CBC's efforts to bring a balanced approach to
many of the issues covered by the network.
The recent rise in media attention to given to this subject is prompting
me enter my response.
I am a Charted Insurance Professional and have worked in the industry
for nearly thirty years. As an educator specializing in insurance I have
closely followed the various comments made by politicians, consumer
advocates and members of the public most of which placed the insurance
industry in a very negative light.
Insurance often seems to become the scapegoat of public opinion in the
face of rising costs or whenever disaster or catastrophe has struck.
Understandably people have expectations, but there is a generally
negative attitude towards insurance which continues to prevail. The
predominant reason for this is that the concept of insurance is
completely contrary to the overall consumer mentality. Rarely, if at
all, is there mention of insurers having been paid losses to the utmost
satisfaction of insureds, nor that insurers have often gone beyond the
call of duty.
There is a preoccupation with negative public opinion which only
provides fuel for an increasingly adversary environment.
Although millions of people purchase insurance and equally millions have
had the benefit of insurance after a loss, there is a fundamental lack
of knowledge and understanding of the subject of insurance in general.
Because insurance has been widely available at a reasonable cost there
is a misconception that insurance is a commodity as any other, the
purchase of which should be based solely on price and on entitlement.
Insurance is rarely viewed by the public in the context of managing
financial risk and as an investment to protect assets but rather, for
the most part, as an unwelcome expenditure.
For many people insurance becomes important only when the danger is
already imminent, the chance of a loss virtually certain or when they
have witnessed the adverse effects of a loss on people's lives when
there was no insurance in place.
When the cost of insurance increases, the terms become more restricted
or insurance cannot be offered to some, few consider that there might be
a valid reason for this to occur, in fact it is generally perceived as
totally unfair. Although it is insurers who end up taking a major
financial risk it is automatically assumed that this protection should
be available to everyone. And yet, no reasonable person would proceed to
buy a vehicle which they know is going to break down within a few days
of purchase, nor would anyone agree to buy a home with a damaged
foundation.
Insurance is rarely considered, even by financial experts, as an
integral part and major component in the overall (global) economy.
In the aftermath of 9/11 insurance losses were calculated to amount to
over 40 billion US dollars which was the largest single loss in the
history of insurance. Furthermore, the insurance industry suffered a
loss of investment income of US$200 billion in the year following 9/11
due to the sluggish economy.
Since insurers must rely not only on premiums but also on their
investment income to finance insured losses the past two years have
placed a major financial strain on insurers. Still, losses continue,
natural disasters of magnitudes that no one could foresee occurred, most
recently the fires in BC, all of which impact the insurance industry.
Although insurance is part of everyday life, its importance has been
largely ignored or dismissed. Unfortunately, the main thrust of public
education aims to focus on and reinforce consumerism and insurance does
not fit into this philosophy.
During my lectures, seminars and workshops I become constantly aware of
the challenges professionals in the insurance industry face to inform
their clientele and combat the prevailing attitude.
It is not enough that the insurance industry tries to educate the
public. In fact, it is of little consequence when there is an overriding
negativity which is only reinforced by some mindless comments made by
public figures.
The support to help people gain a better understanding of insurance must
come from a variety of sources, not the least of which is the media.
I appreciate the opportunity to contribute to CBC's effort to bring this
issue to the public.
Edith Strauss, CIP | Vancouver, BC
I would like to tell you what insurance horrors our company has experienced.
We are a midsized company & we build bridges. Our liability insurance is important to us as most municipalities we work for requires us to have $5 million. Our liability insurance has been with Dominion of Canada . We have never had a claim against us in all the years we have been in business(15yrs).
We were in the middle of a job & Dominion informed us they were cancelling our policy & gave us 30 days to find a new insurer. At this time we were told by our insurance broker the reason for cancellation was that Dominion was interested in insuring big business only. Due to the fact there are only a few Insurance companies who will insure bridge builders we placed with another. Our insurance went from 17,000.00/yr.to 34,000./yr. Then on top of this our Commercial Auto went from 3200 to 6200.00 Dominion Of Canada kept this part of our Insurance. Small business is the backbone of economy how can we
survive these increases. At the time this occurred I emailed every government department I could from Provincial to Federal & got no help & no response in many cases. I have little patience with the promises of those running for provincial politics as they seem to be worrying about personal auto only.
What about businesses such as ours? We are not going to be able to continue if insurance increases more. We have been told by our agent to get ready for another increase next year.
Yours truly,
Shelley Pepping
Recently, my annual premium was increased by 21% for having a "perfect
claims free record" while my car is only getting older. Why does the
consumer have to suffer when large corporations like insurance companies
don't make records breaking profits? May be it would not hurt so much if my
salary was increased by 21% a year!
Diane Geverink, CFP, Canadian Diabetes Association | Toronto
Hello :-)
I was watching the news the other night when a notice came on that you'd like to hear from disgruntled citizens who have something to say about current insurance practices.
Oh! ... Yes! ... Pick me! I'm an articulate guy with a wild tale that befits a national stage telling. Moreover, I've tried virtually every other avenue open to me to seek redress for the appalling way I've been treated -- to no avail. Worse: if you don't deal with my story in some way, I fear the situation will get worse -- a lot worse -- for every driver in Alberta.
The situation I am in spells out just how appallingly rapacious and unethical the car insurance business is in this province. Allow me to explain.
I came home from holidays in BC this summer to a nasty letter from Morgex, my broker for SunAlliance/Acentus, the company I had insured my car with through my college employer, Lethbridge Community College. I had been assessed two at-fault claims against my policy and been dropped by SunAlliance/Ascentus. When I phoned to ask why, I was informed the first stroke against me was a fender bender my daughter had had in her own car when I wasn't present! The second charge is based on an accident that didn't even happen! I was backing out of my driveway one day, creeping past the big cottonwood in my front yard that creates a blind spot when aligned with the wide rear window pillar of my Chrysler New Yorker. At the same time, a motorcyclist was speeding east next to the curb in my blind spot. I had a few feet of bumper out in the roadway when he honked and skidded around me to avoid hitting my right rear quarter panel. He didn't hit my car; he didn't careen or lose control of the bike, or even go into a fishtail or have to put his bike down. In short: no contact, no accident, no real reason to claim any damage whatsoever -- not even soft tissue damage.
He did phone the police when I wouldn't give him the satisfaction of stopping to listen to him swear and carry on, and they came 24 hours later to take a statement. Didn't listen, didn't measure any skid marks, didn't examine the view from my vantage point; simply issued a ticket for backing up unsafely.
I naively thought that if a peace officer wouldn't listen or observe the facts when they were right under his nose, no judge would either, so I paid the fine.
Big mistake, apparently.
The other party subsequently phoned my insurance broker, claimed he hit me (!) -- or so I was subsequently told by Sun Alliance -- and tried to bilk my insurance company of ten grand. They settled for $3500 out of court, without so much as sending an insurance adjustor to the incident site to see if my car had, in fact, been hit. Their excuse? It's cheaper to settle a "nuisance claim" than pay court charges!
The problem is that that action puts me in the facility category on the computer that every other broker can access and my insurance, consequently, has jumped from $500 to $4000 per year -- without my even having an accident!
Now my new broker has dropped me for the same bogus reason of too many at-fault claims! I've got until Sep. 28th to find a new broker.
To be fair, I'm no longer driving the 78 Chrysler New Yorker, and I want complete coverage, not just PLPD, on a 1997 Subaru Outback that my wife and I are now sharing. If the rates were reasonable, I'd want to insure an older model Ford LTD with PLPD only, so the two of us could drive a second vehicle.
Mitigating circumstances include the fact that my daughter was, but is no longer, insured under my policy, and the fact that I have been involved in one other collision that is now before the courts. I went through a yield in the Ford LTD that was obscured by a wind-tossed weeping birch and was clipped in the last foot of my left rear panel just behind the left rear wheel. The damage to my car was minimal. The fellow who hit me -- also speeding -- failed to break and sustained more damage on a newer vehicle. I am now contesting the going through a yield charge on account of the fact that the sign was not visible. I have yet to have my day in court, but that doesn't stop the insurance scammers from treating me like a criminal!
Can you help me? I'm a fifty-one year-old driver who's been driving since I was 16. I have only had a handful of fender benders in my life, and assure you, I'm a safe driver and responsible, highly educated and reasonable human being who is being screwed by crazy insurance policies in Alberta. I'm a college English instructor and author who's contributed plenty to the fabric of the cultural life of this province, but fear I may have to quit a job I have only 8 years left in before I can retire -- just to move out of province so I can be treated fairly and honestly! With the three grand my daughter's insurance now costs me, and a son 15 coming up on his need for a license, this bullshit beef is currently costing me a 10th of my income!
I don't like tithing to a bunch of goddamn crooks and liars! I've written everyone and talked to several lawyers, but it would appear Alberta's car insurance laws are so Draconian and rapacious that everything that has been done to bilk me of the exorbitant rates is perfectly legal -- including taking some joker's word for an accident that didn't even occur. The insurance company is not even required to get evidence!
Richard Stevenson | Lethbridge
I am writing this e-mail in regards to the extreme and unfair hikes in insurance that are being passed down to the business sector.
I am the owner of an Automotive Repair Facility in Mississauga and have been in business for 5 years. Since the incorporation of my business I have experienced huge insurance hikes every year. In fact I have been forced to seize certain types of repair services on trucks because the premiums would be even greater. It goes without saying that the inability to provide those services has impacted my bottom line.
In order to offset the steady increases I have had to raise my per hour labor rate by almost 25 percent and fully expect to increase it again this fall. The rate increase is not for the benefit of my employees it is to cover the absurd increase in insurance. Will I be forced to include an insurance surcharge on my invoices as many of the transportation companies have done when the price of Diesel went into orbit?
There is no basis for the increase since I am not an abuser of my policies, furthermore, I have always ensured that my company was adequately covered in the event of an accident. Why is there no emphasize by our Provincial Government to track down and punish those who abuse the insurance industry? If the insurance industry cannot manage their own affairs why is out Government not stepping in to protect the rights of tax paying citizens and industry alike?
Under the circumstances I, and many others may be forced into increasing our deductibles or limit coverage in order to minimize the rate increases. This is in fact un-nerving since my company would be at great financial risk in the event of an unfortunate accident. I was under the impression that insurance was to protect companies and individuals. It appears that minimal coverage and premature grey hair is all we can afford instead.
The Provincial Government must address this issue as the end user "consumer" will be directly liable through increased labor or retail charges. Our Provincial Government is also forcing small business to operate with less than adequate coverage if they have any coverage at all.
Rick Scott, Smoke Check Ltd. | Mississauga, Ontario
In response to your auto insurance report of Sept.10th 2003 and request for stories or comments Sept.15th 2003.
The government run insurance schemes- No Fault Insurance Schemes are based on delay of benefits, denial of benefits and a systematic accident injury claim nullification for meritorious accident insurance benefits. When the insurer can at will place limits on or cancels your benefit for any reason as they see fit this equates to lower benefits paid out and more profit for the company. The insurer does not have to pay out benefits so rates appear to be lower than the open market schemes. From personal experience the benefits in Saskatchewan by the Saskatchewan Government Insurance are extremely inadequate in negligent manner.
These insurers are committing Insurance Company Fraud and injuring claimants further in simulated work camps where your treatment is outlined as your job, if you qualify for this abuse. Contracted treatment providers are paid as informants for the insurer in a not at arms length manner at approx. $100.00 to $250.00 per day for a glorified gym membership. They are contracted too report everything you say and everything you do to the insurer in the guise of treating you. These reports are made by the treatment facility in such a fashion as the insurer instructs them and requests reports that must show improvements to a level of being discharge from the facility even if you have not improved or maybe even receive further injuries by the activities forced upon the claimant in these facilities during your allotted cookie cutter 6-12 week internment. If you don't qualify for this work camp, you get the opportunity to fight the insurer in court when SGI denies your claim, while your injured and off work in a most vulnerable position unable to fight the insurer with no money for proper legal advise which leads to improperly adjudicated judgments in Court that further injure the injured, forcing people to go bankrupt or live the rest of their lives with their injuries and in poverty.
I now have 3 (found to be not at fault in each) accidents 1997,1999 and 2002 before the Courts in Sask. where grudgingly, benefits were supplied and then cut off while I had not yet recovered. Being prescribed on full leave from my work after my last accident of 2002 there has been no benefits or treatment provided or forwarded for my latest accident of Jan. 28th 2002 over 1 3/4 years ago even thought there has been on going medical reports and information supplied to the Saskatchewan Government Insurance insurer on a regular basis. I have tried over 30 times to contact my MLA who just happens to be the Premier of Saskatchewan - Lorne Calvert about my problems with SGI the insurer but he has responded in a fashion by letting my abuser President of SGI Mr. Larry Fogg answer for Mr. Calvert the Premier of the Province and my MLA.
I have also be placed under surveillance for submitting an accident injury claim in 1997 when I was injured in a hwy head on with an Alberta drunk driver. The findings of this surveillance confirming what I had imparted to the insurer but it's the point that the insurer will do anything and try everything to deny, delay and nullify almost all injury claims. This is especially true if you have reviewed the Automobile Accident Insurance Act, which I have and know what benefit are available since the insurer does not comply with S. 171 of the Act too advise, assist and ensure the claimants receive benefits as legislated.
Check out the Sask. coalition against No- fault to get the real reason why public insurance may appear to be less expensive and also the work camp internment documentary done by the CBC in 2002.
I know many other people with similar stories and my extensive court documents are available to show that you can pay for insurance but do not expect the insurer to supply the insurance you have paid for in a fraudulent manner of injury claim denials.
I would gladly pay more for accident injury and auto insurance if the benefits you have paid for were actually available when you needed them.
There are always stories supplied by the Insurers about how the public is committing fraud against the insurers where they say this drives up the costs but I think it is time the very insurers pointing their finger at the public be investigated for Insurance Company Fraud for not supplying the insurance the public has paid for and expects to be available should a loss occur.
Roger C. | Saskatoon
I had homeowner's insurance coverage with Wawanessa Insurance for 5 years. When one day my house I was in process of moving to was robbed and most of my stuff was stolen Wawanessa (Mr. Davies)done everything in their power to make my life as miserable as possible and escape paying for the loss. I asked BBB, Canadian Consumer's Association, Canadian Insurance Bureau for help and it made Wawanessa bosses very mad. They sent their investigators who showed up at the house where the loss occurred (without photo camera)to investigate me for 6 months and turned my claim down. I needed $8,000.00 to try to fight them in court. I had no $8,000 dollars and gave up fighting. This is what the powerful insurance companies are doing to get rich quick.
Andre Darowski
I am very concerned with the rising premiums for property & liability insurance for small business. My company, Kitchener Hockey Sticks Ltd. has been 'hit' with a 58% increase over last year by Royal & Sun alliance Insurance, and this is WITHOUT ANY CLAIMS what-so-ever during our 37 years in business!! During the last couple of days, I have spoke with four other business owners, each of which have experienced huge increases as well, ranging from 32 to 76%.
I am now considering applying an "insurance surcharge" to each and every one of our outgoing invoices, similar to what the transportation industry implemented a few years ago and maintain to this day with their 'fuel surcharge'.
Sandy Watson | Kitchener
One of the insurance areas that is costing millions is not being talked about in the media: Business Insurance, especially with respect to Product Liability.
Auto insurance rates affect all of us. We're all out-of-pocket more than last year and the year before. The dollar amounts however are relatively small compared to the huge absolute dollar increases we've experienced for our businesses.
You can't force a company to provide a good or service. But there needs to be an acknowledgment in the insurance world that there is a problem that demands some consultation. And they need to get a little outside pressure to start a pro-active dialogue with their customers and an understanding that you can't beat us down. How do they expect us to be around for the future? And how can they possibly expect we'll have any loyalty at all when the market softens again in a few years? (I really hope if softens as it has historically because my customers are in for a big increase if we get hit again next year!)
Hell, right now, if I were offered "only" a 20% increase I'd grab it without a word of complaint. It's scary that I consider myself "lucky" to find a company that would insure Dom Sports (div. of Dom Enterprises Mfg. Ltd).
Marc Petruccelli, www.domsports.com | Toronto
Comments: Just a comment about rising insurance rates. Somehow I could accept this if just one insurance agent could (not would) explain to me WHY 9/11 continues to have such an impact on my house and car insurance rates. When I asked my agent "why?" all I received was "It's because of 9/11.". When I asked for more information she COULD not explain. My property (personal & three rental homes) rates have risen by over $400 this year - an increase of around 30%. My mother lives in Florida. Her car insurance has risen by 50%! She, too, received the same nebulous explanation concerning 9/11 and rising rates.
I have always found insurance companies to be large, curious entities. What a wonderful excuse "9/11" is for these larger than life, all-powerful companies to earn more profits. How disgusting it is that the horrific destruction of the World Trade Towers can be used as an excuse for those eager to make MONEY!!!
Michelle Miller | Winnipeg
I am writing in response to the ridiculous rise in not only car but house insurance. I am a senior citizen (almost 80 years old) and own a small log home I had built 15 years ago. My pensions give me around $15,000 a year. I have been claims-free my entire life. In 2001 my house insurance premium was $376.92. In 2002, the insurance company raised the premium to the $700 range so I switched brokers and was insured by Wawanesa. They charged me $567. This past June when my renewal came due, Wawanesa wanted $1,033.56! I called the broker and even she was shocked. I met with her in person to discuss the 82 percent rise in my premium. Upon meeting with her she started giving me the reasons for the premium increase: there had been two rate increases since my last renewal and (because it was a log home) if one log at the bottom needed to be replaced the entire wall would have to be dismantled, an expensive undertaking. I even called Gray Power insurance to get a quote and they refused because it was a log home. No broker I've ever talked with could give me any examples of a log home catching fire or the costs involved in replacing any logs. When buying the home, we were told by the builder it would take six hours for a fire to burn through one log. Certainly there are building techniques that could repair a log without dismantling the whole wall. I believe as customers we are paying for more than just house insurance...after all, most insurance companies offer car insurance as well. Maybe house insurance premiums are being used to keep auto premiums from hitting the $5000-a-year level I've heard some drivers pay in Nova Scotia. Or maybe we're all paying for the losses the insurance companies experienced in the events of 9/11 and the stock market.
Yours in anger and disgust,
Alice Kritzer | City of Kawartha Lakes, ON
Here's how Governments can do their part to help curb the rising cost of insurance: they can stop taxing premiums.
Philippe Duclos | Ottawa
I have long known that insurance companies are principal contributors to political parties. Protected by legal compulsion for drivers to obtain auto coverage their premiums charged are now a disgrace. Never having had an accident in over 50 years of driving and virtually no chance of having one, I am charged over $1000 for liability only. They have abandoned the principle of risk taking, plus I also note that any accident results in recovery over a 6 year term. Is this insurance or old-fashioned gouging?
Name: Hugh Hutchings | Ahmic Harbour, ON
Another twist to the insurance issue is, the insurance benefits provided by employers to employees that is almost impossible to receive because insurance companies are instructed to delay or deny benefits for as long as possible. As a last resort employees have to sue the insurance provider and usually only gets a small portion of the benefits he is entitled to or nothing at all plus has to pay legal fees. The system is sacked against the working person. It's just another way insurance companies steal money from the workers. This is currently happening to me.
Murray Jansen | Meaford, On, Canada
I am a 29-year-old male, who has had full auto insurance coverage for 10 years continually in the province of Ontario. Although, I have no claim history with any insurance company, I have unfortunately received three speeding tickets over the last three years. These tickets, however did not adversely affect my driver's license status, but did considerably affect my insurance rates. As a result, my insurance provider would no longer re-new my past policy rates, and the only rate I could find was for a 6 month term equivalent to double or more than my past rates. To protest these unfair, biased rates, I refused to renew my policy, I am no longer driving, and I'm considering selling my vehicle. This has resulted in a loss of income, a major lifestyle adjustment, and an overall inconvenience to my life. Given that I have paid over $10,000 to these insurance companies for Auto insurance alone in my brief "zero claim" history, I find it completely unreasonable that I am forced to pay exorbitant amounts of money to drive a modest car in an urban centre in Canada. I feel that drivers in this country are profiled and are subjected to receiving increased inspections for speeding, based on the vehicle type, and the driver's sex and age. Furthermore, what proof is there for the correlation between the frequency of speeding tickets (regardless of the severity of the ticket) and driver safety. Insurance rates should be based on claim histories alone and not regulated by speeding infractions, which are a separate legal issue, regulated by the dept. of Justice and the Ministry of Transportation.
M. Sexton | Ottawa
I wonder how much of the car/house insurance increases represent cost recovery by the insurers for payouts from 911? Were there, in fact, any? Car and home insurance seem likely to be a nice "cash cow" for the insurance companies.
Doug Cossar | Toronto
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N.B. report calls for public insurance system (April 2, 2004)
Alberta freezes car insurance rates for 18 months (Nov. 4, 2003)
Klein ready to freeze auto insurance rates (Oct. 29, 2003)
Ontario freezes car insurance premiums (Oct. 23, 2003)
Overhaul N.S. car insurance industry: consumer advocate (June 5, 2003)
Yukon moves to drop insurance company (May 27, 2003)
N.S. auto insurance hikes justified: review board (May 15, 2003)
Province to freeze car insurance rates (May 5, 2003)
N.B. drivers face more insurance premium hikes (April 29, 2003)
Insurers deny making profits in Atlantic Canada (Feb. 4, 2003)
N.S. Drivers get insurance champion (Apr. 11, 2003)
Atlantic drivers face dramatic premium hike (Jan 7, 2002)
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