Taxi drivers fuming over insurance premiums want end to 'monopoly'

Cabbies closed in on Confederation Building today to protest rates they're calling unaffordable — and threatened to fix the problem by parking their cars over St. Patrick's Day weekend.

Cabbies paying thousands each year say current rates unsustainable

A fleet of taxis park outside Confederation Building Thursday to protest bloated insurance rates. (Katie Breen/CBC)

Taxi drivers rolled up in droves to Confederation Building on Thursday to protest rising insurance costs, which they say are crippling drivers and could be fixed if government acted to open up insurance provider options for cab operators.

Joe White, a broker for Newfound Cabs who said he's been in and out of the industry since 1979, blamed bloated premiums on the practice of lumping taxi drivers together rather than charging each driver according to his or her own record.

Over 90 per cent of taxi operators in the province are only able to get insurance from the Facility Association, according to a report commissioned by the Public Utilities Board, which is billed as an "insurer of last resort."

"I have the lowest insurance rate in the industry. It's about 6,800 bucks," White said, up from $1,300 annually just a few years ago.

"Why can't I just go to an insurance company in St. John's?" he asked. 

"We don't have a choice because [Facility] has got a monopoly."

Taxi driver Joe White says he has a spotless driving record, but his monthly insurance bill — over $500 — doesn't reflect that. (CBC)

White blamed officials for not working fast enough to alleviate the mounting pressure on those behind the wheel.

"They won't do anything," he said.

Premiums tripled

A PUB review in 2017 showed auto insurance strain has been ongoing for more than 20 years, said Service NL Minister Sherry Gambin-Walsh on the Assembly floor Thursday.

A separate PUB report found that insurers are shelling out more than they're bringing in due to accident claims. 

Gambin-Walsh said the Facility Association has requested rate increases nearly every year in recent memory.

Everybody seems to be suffering when it comes to insuring cabs, from the insurers themselves to those behind the wheel. (CBC)

As a result, premiums have more than tripled since 2012, according to the PUB, but Gambin-Walsh said the provincial government last year approved a one-third reduction in those rates over four years. 

Inside Confederation Building, about 20 drivers observed a heated exchange between Premier Dwight Ball and Opposition leader ChesCrosbie concerning auto insurance rates and the actions the Ball Liberals are taking to ensure drivers can afford their cabs.

While Crosbie asked about the Liberals' decision to increase tax on insurance companies, Ball defended that move by blaming the previous Tory government for creating a deficit.

"We've taken most of the tax off gasoline," Ball said, arguing the government had to replace that money some other way. "We are trying to create a foundation in this province."

Ball said he would be willing to meet with the industry and said his government was "already meeting with the insurers, as well, to come to a solution."

Paddy's Day protest?

White said added taxes to the insurance provider have only been passed on to the industry, resulting in rates so high he's not sure how he's going to pay them.

He suggested the only foreseeable fix would involve parking every taxi in the city over St. Patrick's Day weekend, one of the industry's busiest times of the year, to send a message to government.

"How is the [Royal Newfoundland Constabulary] going to handle that?" White said. "When you've got thousands of drunks in downtown St. John's and no way to get home?"

Drivers say they shouldn't have to pay for other people's tickets. (CBC)

Drivers also took their concerns to the legislature in 2018, when they circled the building while leaning on their horns. Government said then that they were working on the issue.

A taxi association spokesperson told CBC News at the time that the industry employs about 4,000 people across the province.

Read more from CBC Newfoundland and Labrador

With files from Katie Breen

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