IBC points to flaws in consumer group study of auto insurance

Responding to a study on auto insurance released by the Consumers’ Association of Canada (CAC), the Insurance Bureau of Canada (IBC) says consumers will be misled by the findings.The study compares auto insurance rates in Nova Scotia to those in B.C., Manitoba and Saskatchewan, where insurance is run by the government. The CAC has been pushing for government-run insurance in Nova Scotia and other provinces including Newfoundland and Ontario, where rates have gone up.The study uses rates it says apply in a variety of cities, although there is no indication of where the rates are derived from. The CAC says it got 10 quotes for different rate categories in four different cities in Nova Scotia, and one quote for each category in four different cities in the public auto provinces. The CAC concludes that Nova Scotians pay 100% more than consumers in the public auto regimes.The IBC, however, says this is misleading, and does not take into account the varying levels of coverage or underlying costs of the different systems. The IBC says the average claim paid in Nova Scotia is $5,889 is more than double the average claim reported by B.C.’s public insurer, at $2,368. IBC says the average premium in Nova Scotia is $799, not the $1,778 reported by the CAC. “This so-called study by the BC-based consumers association is completely misleading and adds nothing to the debate on auto insurance in Nova Scotia,” says Don Forgeron, Atlantic region vice president, IBC.”It’s not clear where they got their numbers,” says Forgeron. “What we do know is that the actual statistics from the government of British Columbia show that consumers in British Columbia receive far less insurance compensation for their premium dollar than Nova Scotians.”The CAC says the full report will be released by the end of the summer.