Fraser report hits public auto again

Another Fraser Institute report lashing out at public auto insurance systems was released today. The right-wing think tank says public auto equals the highest premiums and the lowest claims payouts, and is tantamount to selling the public a “lemon”.The study goes on to say public auto provinces have two to four times as many claims per driver.The report is based on ten-years of claims and rate history for all ten provinces, ranking them according to “insurance value” – rates, claim severity and claim frequency.”Provinces with private auto insurance recently paid out average claims that were seven to nine times average premiums,” says report author Mark Mullins, director of Ontario policy studies for the Institute. “Every public insurer fared worse than that, with claims only two to five times higher than premiums.”In 2002, Newfoundland provided the best value, the report contends, wih Atlantic provinces overall faring well. Higher premiums in Ontario and Alberta are offset by the highest claims payouts.B.C. is the worst on the list, with 20% higher premiums and 50% lower claims payouts, Mullins claims.”The public insurance monopolies have turned auto insurance into a social program by mispricing risk and encouraging excessive claims usage,” he contends.