Alberta is reviewing auto insurance in the province to ensure that the industry can remain viable and drivers can get affordable coverage.
Finance Minister Travis Toews says Albertans are paying some of the highest rates in Canada but are having trouble getting critical protection such as comprehensive and collision coverage.
But a five per cent annual cap on rate increases, introduced by the former NDP government and abandoned by his United Conservatives, is not coming back, he says.
“The rate cap simply put a Band-Aid on a wound that was festering,” Toews said at the legislature Wednesday.
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“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 in the last five years. It trend prompted the NDP government to cap global rate increases at five per cent annually for each insurer starting in 2017.
Albertans brace for double-digit auto insurance rate hikes
The new UCP government did not renew the cap in August, and some drivers have since reported getting notices of steep rises in rates 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, individual 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.
Fears mount as more auto insurers raise rates in Alberta
“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 headed by Chris Daniels has been asked to research and recommend solutions that work for all parties within the existing privately delivered system.
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The committee is to report back in the spring. Toews said the government will take action as soon as possible after that.
LISTEN: Finance Minister Travis Toews joins Rob Breakenridge to discuss the advisory panel tasked with assessing Alberta’s auto insurance industry
Daniels, consumer representative on the Automobile Insurance Rate Board, said there is no single reason for rising costs, although technology has made what used to be minor damage no longer minor.
“The new cars have a tremendous amount of technology,” said Daniels.
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“A lot of the sensors of those new technologies are located in the windshield, so you have a windshield replacement that used to cost maybe $300 is now costing $1,500.”
The Insurance Bureau of Canada said it welcomes the review, particularly as it relates to injury claims.
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“Increases in payouts for minor injuries have led the average claim size to increase by nearly 10 per cent per year,” bureau vice-president Celyeste Power said in a statement.
“Alberta’s three million drivers have said they want more affordable premiums, more choice, and care they can count on when they need it.”
MTY Food Group Inc. says its profit and revenue both slid in its most recent quarter.
The restaurant franchisor and operator says its net income attributable to owners totalled $34.9 million in its third quarter, compared with $38.9 million a year earlier.
The results for the period ended Aug. 31 amounted to $1.46 per diluted share, down from $1.59 per diluted share a year prior.
The company behind 90 brands including Manchu Wok and Mr. Sub attributed the fall to impairment charges on property, plants and equipment along with intangibles assets.
Its revenue decreased slightly to $292.8 million in the quarter from $298 million a year ago.
While CEO Eric Lefebvre saw the quarter as a sign that the company’s ongoing restructuring is starting to bear fruits, he said the business was also hampered by significant delays in construction and permitting that resulted in fewer locations opening.
This report by The Canadian Press was first published Oct. 11, 2024.
Taiga Motors Corp. says the Superior Court of Québec has approved its sale to a British electric boat entrepreneur.
The Montreal-based maker of snowmobiles and watercraft says it will be purchased by Stewart Wilkinson.
Wilkinson’s family office is behind marine electrification brands that include Vita, Evoy, and Aqua superPower.
Wilkinson and Taiga did not reveal the terms or value of the deal but say Wilkinson will assume Taiga’s debt to Export Development Canada and has committed to funding Taiga’s business plan.
The companies say the transaction will allow them to achieve greater economies of scale and deliver high-performance products at compelling prices to accelerate the electric transition.
The sale comes months after Taiga sought bankruptcy protection under the Companies’ Creditors Arrangement Act to cope with a cash crunch.
This report by The Canadian Press was first published Oct. 11, 2024.
Toronto-Dominion Bank is facing fines totalling about US$3.09 billion from U.S. regulators in connection with failures of its anti-money laundering safeguards.
The bank also received a cease-and-desist order and non-financial sanctions from the Office of the Comptroller of the Currency that put limits on its growth in the U.S. after it was found that TD had “significant, systemic breakdowns in its transaction monitoring program.”
