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How You Can Help
If you have been a victim of the Injury Regulation, you realize how easily you could become one, you are bothered by the fact the insurance industry is being allowed to profit unreasonably at the expense of victims and the New Brunswick economy, or you simply have a problem with the basic unfairness of the cap, you can do your part to help us persuade the government to remove it from the books.
Myth vs. Reality
The are many myths relative to auto insurance that the Insurance Industry likes to perpetuate.
What the government or anyone else outside the Industry didn’t know at the time was that the economic data did not support that assertion. A review of the Industry's economic data from 1996 to 2006, shows that bodily injury claims were not spiralling out of control but rather had been decreasing steadily from 1999 to 2004, those very years the industry was lobbying for relief and blaming bodily injury claims for premium increases.
Myth No. 2 - The Injury Regulation brought stability to premiums
The Insurance Industry and the Graham government like to pat each other in the back saying that the Injury Regulation brought stability in auto insurance premiums. However, in order to believe that comment, you must first believe that bodily injury claims "destabilized" the premiums in the first place. The Industry's economic data does not support that allegation at all and, on the contrary, shows that bodily injury claims were under control and decreasing rapidly even before the Injury Regulation. Therefore, stability in premiums was achieved through other factors but clearly not by the introduction of the Injury Regulation.
Myth No. 3 - Removing the Injury Regulation would create another Insurance Crisis
First and foremost, the Insurance Industry's economic data shows that if the Injury Regulation was completely removed, the Industry would achieve an after tax return on equity of approximately 13.3%. This rate of return still exceeds the rate of 10% which is considered by experts in the Industry and the New Brunswick Insurance Board a fair and reasonable profit for auto insurers.
Secondly, premiums cannot increase by more than 3% without prior approval of the New Brunswick Insurance Board (section 267.51(1) of the Insurance Act). Among the many changes to insurance brought in by the former government was the creation of a regulatory body for auto insurance – the New Brunswick Insurance Board. As a result, the Board has the mandate to review and access and request for increase of 3% or more in auto insurance premiums. Given the industry’s extraordinary profits since the introduction of the Injury Regulation in 2003, there is no chance any such application would be successful.
Furthermore, an additional regulatory body was also created by the former government - The Office of the Consumer's Advocate. The Consumer Advocate's mandate is to protect and investigate any unfair and discriminatory tactics of auto insurer in setting premiums. Therefore, should the Industry retaliate against the consumers for the removal of the Injury Regulation, it would be squarely within the mandate of the Consumer advocate to regulate and control against such actions.
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