Nova Scotia moves to “no frills” auto product

The Nova Scotia government plans to move to a “no frills” auto product in an attempt to lower auto insurance premiums in the province. The government expects to see a 20% reduction in premiums as a result of the plan, which will see a basic auto insurance policy mandated, limiting minor injury compensation and “pain and suffering” awards. “Limiting claims in the case of minor injuries is an importantfactor in containing costs in the long term,” says Nova Scotia Environment and Labour Minister Ron Russell.He says government data shows the change will result in an average 20% drop in premiums. “We expect to see immediate rate reductions in the applications filed by insurance companies. If they are not forthcoming, other options will be considered, including a publicly run system in conjunction with the other Atlantic provinces.”Other points of the Nova Scotia plan include an optional product for increased accident benefits, the creation of an Insurance Review Board to oversee rates, and detailed explanations for drivers refused coverage. It also includes underwriting rules announced previously, banning insurers from refusing coverage on the basis of age, race, gender, or if the driver has belonged to the Facility Association in the past.Nova Scotia is the latest Atlantic province to act on auto insurance, with New Brunswick having moved to limit “pain and suffering” awards earlier this month.The Atlantic premiers are looking at a harmonized approach to auto insurance, including investigating the potential for a public auto insurance system.