Soft-tissue injury cap pushed as election issue
August 12th, 2010Victims say $2,500 isn't enough; http://dailygleaner.canadaeast.com/cityregion/article/1172862
During the 2003 provincial election campaign, auto insurance rates emerged among voters as a flashpoint issue following a dramatic spike in premiums.
The cap was introduced by then-premier Bernard Lord's Progressive Conservative government with support from the Shawn Graham opposition Liberals as a way to get premium rates down.
It worked. New Brunswick auto insurance premiums have decreased by 35 per cent since the cap's implementation.
Consumers for Insurance Fairness said it's unjust that the cap applies to people who suffer chronic pain, had bones broken or went into a coma.
Both the Liberals and Progressive Conservatives have indicated they're interested in addressing the $2,500 cap.
Premier Shawn Graham says the Liberals have nothing immediate to announce in terms of any cap changes.
Graham says he wants to look at what other jurisdictions are doing. Nova Scotia's New Democratic Party government recently announced they'd push their soft-tissue injury cap up to $7,500.
"We want to see if that has an impact on the rates New Brunswickers would pay for their insurance," says Graham. "That continues to be the number one concern of government, keeping insurance premiums affordable for all New Brunswickers.
"If there's a minimal impact it's something we could potentially look at. We have to do the due diligence first."
The Progressive Conservatives say they'd increase the cap rate if elected in this fall's election, but they don't know by how much.
"The specific amount of how much will be based on a three-month review upon taking office," says Tory MLA Jody Carr. "We want to be responsible rather than just pull a number out of a hat. We want to make sure it's a responsible cap so we don't see an increase in rates."
Carr says the timing is right for a review seven years after the cap was first introduced and also in the wake of Nova Scotia's move.
Bill Adams, vice-president of the Insurance Board of Canada's Atlantic division, says "The reality is that this is a competitive industry. That's the beauty of a competitive industry. There are 67 insurance companies selling auto insurance in New Brunswick."
Adams says auto accident benefits still apply up to $50,000 for medical and rehabilitation payments, regardless of the cap.
He said more than half of all New Brunswickers don't realize that the $2,500 cap is only for pain and suffering associated with minor injuries.
"The reality is you still get up to $50,000 in medical and rehabilitation payments, so all the physiotherapy and tests and chiropractic you need to heal, you get. It's rare that people exhaust that.
"The reality is they can get the medical treatments that they need in order to get well. What they're not getting is an unlimited payout.
"For them, they may say this is worth more than $2,500, and I'm not going to argue that with anyone going through pain."
He said the cap doesn't apply to compensation for lost wages, medical and economic losses.
He said other costs can be applied to a court action.