The Alberta government has launched a review of auto insurance in the province, saying it wants to ensure the industry can remain viable and that drivers can get affordable coverage.
Albertans pay some of the highest rates in Canada but have trouble getting critical protection, such as coverage for comprehensive or collision, Finance Minister Travis Toews said Wednesday.
But a five-per-cent annual cap on rate increases, introduced by the former NDP government and since abandoned by the United Conservative Party, is not coming back, he said.
“The rate cap simply put a Band-Aid on a wound that was festering,” Toews said at the legislature Wednesday. “In the intermediate and long term it was no solution, and even in the short term it made a bad situation worse.”
Auto insurance rates in Alberta have been rising sharply over the last five years. The trend prompted the NDP government to cap overall rate increases at five per cent annually for each insurer, starting in 2017.
The UCP government did not renew the cap in August, and some drivers have since reported getting notices of steep increases of 12 per cent or more.
Insurers have said that under the cap they were losing money in Alberta, given more payouts for car theft, injury claims, repairs and catastrophes such as the 2016 Fort McMurray wildfire.
Toews said the cap forced insurers to seek savings at the expense of drivers by, in some cases, refusing to offer critical protections.
In other cases, some clients were still hit with steep increases as long as the overall hike by the insurer to all Alberta clients remained at five per cent.
“Under the cap, we had insurers getting squeezed … so Albertans were finding themselves with fewer and fewer insurance options,” said Toews.
“We ultimately need to deal with the challenges that are leading to increased premiums … and present a reformed insurance system in this province that can serve Albertans well.”
A three-member committee has been asked to find solutions that work for all parties within the existing privately delivered system, Toews said.
In an interview with CBC News, Premier Jason Kenney said the government will use the “next six months to address out-of-control increases on personal injury awards.” Those payouts contribute to driving up costs, which are then paid by customers through their premiums, he said.
Asked about a cap, Kenney said former premier Ralph Klein put one in place in 2004.
“We’re going to look at how to have a more effective control,” Kenney said. “Something like a no-fault insurance system, which maintains a reasonable control on the awards.”
In 2004, the Klein government put a $4,000 cap on soft-tissue injuries. In the four years that followed, auto insurance premiums dropped by about 18 per cent.
Back then, Alberta’s auto insurance system was the envy of all the systems in Canada, said Celyeste Power, western vice-president of the Insurance Bureau of Canada.
Court challenges in 2012 and 2015 found some “vulnerabilities” in the definition of minor injury, she said.
“What we’ve seen from that is a huge increase in legal representation and lawsuits around that to kind of push things outside of the cap,” Power said. “Fifty-three per cent of the costs that have increased over the past five years have been associated with that.”
As a result, there are injuries considered minor in other jurisdictions that are not in Alberta. A common example of that is TMJ (temporomandibular joint) disorders, which affect the jaw muscle, she said.
‘We need to get this system fixed’
While fixing the definition of minor injury is important, Power said, there also needs to be adequate care in place to treat people who are injured in automobile collisions.
“Even if the minor injury cap is meant to capture more of these injuries, if it is a serious injury … if you have chronic pain for six months plus, and that’s considered serious, then of course you would be able to get the care and support you need,” Power said.
Clarifying the definition would likely offer stability to premium rates, she said.
“We need to get this system fixed for the three million drivers who count on it,” Power said. Drivers are “sick of increases in their auto insurance” and want more control over what they’re paying for and what they’re buying.
The committee will consult with consumers, industry stakeholders, medical experts and the legal profession.
The committee includes chair Chris Daniel, who is in his second term as the consumer representative on the Automobile Insurance Rate Board; Shelley Miller, a lawyer with expertise in auto insurance reform; and Dr. Larry Ohlhauser, who has served as medical adviser to the superintendent of insurance for the past 12 years.
The committee will report back to government in the spring 2020 legislative session.
NDP’s Service Alberta critic weighs in
Jon Carson, the NDP’s Service Alberta critic, wants to see what comes of the panel but said he is worried that Albertans will continue to pay more for auto insurance in the meantime.
“The fact is, we’re already several months past when this government said they were going to take action, and nothing has been done up to this point,” Carson said.
“So, we’re very concerned that now we have to wait several more months before any decision comes forward, whether it’s actually protecting Albertans in their pocketbooks or not.”
Carson said he disagreed with the finance minister’s assessment that the five-per-cent rate increase cap introduced by the previous NDP government “made a bad situation worse.”
“What we would have liked to see is that cap to stay in place, and then we can move forward with this committee discussion,” Carson said. “But to preemptively get rid of that cap and then say we’re going to come up with a solution. They’ve made a committee now to cover up the fact that they are the ones who’ve affected consumers so negatively at this point.”
With files from Canadian Press
Desperation sets in as CERB is set to end; these three Canadians are among the millions living on the bubble – Toronto Star
Canadians who’ve been relying on the Canada Emergency Response Benefit (CERB) to make ends meet during COVID-19 say there’s a sense of desperation and panic as the program nears its end later this month.
Stephanie Cohen was receiving EI payments before the pandemic as a result of losing her job as a copywriter at a digital marketing agency in Montreal. She transitioned to CERB in May and the $2,000 has kept her going since then.
The money has helped her pay basic bills and assisted her mother in buying groceries and other home necessities. Even though it’s less than what she was making at her work, it provided a much-needed financial boost and a little bit of “peace of mind” during a difficult period. Having zero income “would have been devastating,” she said.
As others do, she knows very little about the new benefits that will be offered to jobless Canadians starting Sept. 27.
“It is a pretty big concern, considering I’m in the category of people who exhausted their previous EI benefits,” Cohen said.
She’s especially worried new recovery programs, which are just proposals at this point and won’t be solidified until after the government’s Speech from the Throne on Sept. 23, will ignore people such as she, who were job-hunting prior to COVID-19. The pandemic, she said, put her hunt on hold and the economic hit to business across a variety of sectors makes it hard to know when people will start hiring again.
“I haven’t been able to receive a clear answer as to how I move forward,” she said about the lack of information on the upcoming benefit programs. “If I am not eligible to re-apply for EI, I’ll have zero income coming in, which would be a hard blow for me financially.”
A recent analysis from the Canadian Centre for Policy Alternatives warned millions of Canadians who depended on CERB will be hard hit by the upcoming change.
CERB had been instrumental in helping Jordan Troy, a Guelph resident who had just completed college and was looking for a job as an elevator mechanic when the pandemic hit. The 23-year-old said he recently started working a few hours a week at local restaurants when they reopened, but still makes less than $1,000 per month.
“I’m worried, of course. I don’t know if I will qualify for EI or any of the new programs, and there is no information right now,” he said. “At least with CERB, you knew you weren’t going to go hungry or miss a rent payment. Now everything is up in the air.”
Nick Cunningham had been working in the live music industry at a Toronto talent agency, helping with the booking of venues and organizing tours for Canadian artists. For the first few months of the pandemic, his agency managed to keep a small group of employees at work as they helped artists run virtual concerts and drive-in shows. But he was laid off last month.
“Everything was so sudden. I was working one day and the next day I wasn’t,” said Cunningham. “These past six months have been incredibly stressful, with so much uncertainty and repeated work, it felt like groundhog day every day, until I lost my job.”
So far, Cunningham has collected the CERB just twice. While he said he’s grateful for the support, he is “scared” that the switch to EI and other programs could leave him short of what he needs to get by.
“It’s already hard to survive in Toronto on $2,000, and I feel like it’s about to get even harder with these new changes,” said Cunningham, who says special support for people in the live music industry is needed.
“Our government is not doing anything to address this industry’s shutdown, and I am getting anxious. I have spent my entire life getting to where I am now, and unfortunately things feel bleak with the soon-to-be removal of CERB.”
JOIN THE CONVERSATION
Have you been relying on CERB? What will you do once it ends?
Nuvei’s Red-Hot IPO Marks Canada’s Largest Tech Offering – Bloomberg
Payments company Nuvei Corp. jumped 31% in its trading debut on Thursday, riding the wave of demand for technology shares that has swept the globe in recent months.
Montreal-based Nuvei, which supplies payment technology to the retail, travel, gaming and other sectors, is among a cluster of firms benefiting from the shift to e-commerce during pandemic lockdowns. The deal raised $700 million, making it the biggest tech offering in the history of the Toronto Stock Exchange, the exchange said in a statement.
“The rebound in technology names is a good sign for the private tech companies with plans to publicly list their shares in the coming weeks,” CIBC analyst Stephanie Price wrote in a note. With tech IPOs such as Snowflake Inc. surging more than 100%, investor demand remains strong, she added.
Nuvei will take in proceeds $625 million before costs and fees, while $75 million goes to selling shareholders.
Information technology stocks are up 80% from their March 16 low on Canada’s largest exchange, compared to a 57% gain in the S&P 500 information tech index. Nuvei’s listing follows Dye & Durham Ltd.’s July offering, which raised C$172.5 million ($131 million). Another Montreal company in the merchant software business, Lightspeed POS Inc., raised C$276 million in an IPO last year.
Shares of Nuvei were priced at $26 but climbed as high as $35.04. They ended the day at C$45.05 ($34.12).
Backed by Caisse de Depot et Placement du Quebec and private equity firm Novacap Investments Inc., Nuvei has about 50,000 customers and supports transactions in nearly 150 currencies. The company connects business owners and customers “no matter where or how they do business,” Nuvei Chairman and Chief Executive Officer Philip Fayer said in an statement.
The global mobile commerce and e-commerce market is expected to increase to $6.3 trillion by 2024 from $3.4 trillion in 2019, according to Nuvei’s prospectus, citing eMarketer, a market research company. Nuvei generated revenue of $245.8 million and adjusted Ebitda of $87.2 million for fiscal 2019, according to its prospectus.
Nuvei’s shares are trading on so-called “if-and-when-issued basis” until the offering closes on Sept. 22, according to a separate statement by the company.
Bank of Canada's second-in-command to step down when her term ends next year – Financial Post
Article content continued
Experience away from the central bank appears to have become a requirement for running it
Experience away from the central bank appears to have become a requirement for running it. Wilkins, who broke one glass ceiling when she won the competition to become senior deputy governor, is still young enough to be governor. Macklem, 59, will have reached retirement age when his term ends in 2027.
But that’s the future. Here in the present, Wilkins’ decision to leave will trigger a reshuffling of the Bank of Canada’s leadership group ahead of what promises to be an exceptional period in the central bank’s history.
The central bank has already committed to doing its part to fight the COVID-19 recession by keeping interest rates near zero for at least a couple of years, evidence that the country’s biggest collection of PhD economists think the economy is extraordinarily weak.
Canadian policy-makers for the first time have deployed quantitative easing, or QE, in which the central bank uses its unique power to create money in order to buy debt worth hundreds of billions of dollars. The experience of the U.S. Federal Reserve and other central banks suggests the aggressive strategy will work, but QE remains an experiment that must be closely watched.
Wilkins’ mandate review, which could result in a decision to replace the Bank of Canada’s inflation target with a new approach to setting interest rates, also looms. All told, it won’t be a casual seven years for Macklem and his deputies.
Like the governor, the senior deputy governor is a cabinet appointment, so Chrystia Freeland, who replaced Morneau last month as finance minister, will influence the decision. At the same time, convention grants the governor significant say over who serves as his top lieutenant. The independent directors of the Bank of Canada’s board will lead the search and recommend candidates to Freeland.
Mickelson struggles Thursday at Winged Foot – pgatour.com
COVID-19 in B.C.: New and active cases hit record highs, 10 schools report cases, and new gargle test for children – The Georgia Straight
Australian stinging tree could pave way for novel painkillers – News-Medical.Net
Silver investment demand jumped 12% in 2019
Iran anticipates renewed protests amid social media shutdown
Richmond BBQ spot speaks out about coronavirus rumours Vancouver Is Awesome
- Tech18 hours ago
Where to preorder your PS5 right now
- Tech24 hours ago
PlayStation 5 pre-orders now live on Amazon Canada [Update]
- Tech9 hours ago
PlayStation 5 pre-orders now live on London Drugs' website [Update] – MobileSyrup
- Tech16 hours ago
Our 6 favorite iOS 14 features and how to use them on your iPhone now – CNET
- Tech17 hours ago
Upgrading to iOS 14 or iPadOS 14? Good, just do this first – CNET
- Art22 hours ago
Treasure trove of Inuit art found in rundown Detroit house – CBC.ca
- Tech12 hours ago
Sony says it will have more PS5 stock at launch than it did for PS4 in 2013 – MobileSyrup
- Media10 hours ago
Media Advisory – Ahead of Federal Throne Speech, Canada's Premiers to Hold News Conference in Ottawa on September 18, 2020 – Yahoo Finance