Identical Conservative and Liberal
Promises on Auto Insurance
Ignore Obvious Practical Solution:

Public Auto

July 11, 2003

Dual July 10th announcements from Conservatives and Liberals on auto insurance proves, yet again, that both parties are equally incapable of providing decisive leadership for change.

If you thought Liberals and Conservatives sounded the same on hydro privatization - look at their policies on auto insurance:

Conservatives: "Automobile Insurance Affordability Plan for Ontario"
Liberals: "Lower Rates, for a Change"

Conservatives: Promise to find savings ($500 million) then (somehow) force industry to pass savings on to consumers
Liberals: Promise to find savings ($650 million) then (somehow) force industry to pass savings on to consumers

Conservatives: A possible rate freeze but no moves that would anger their rich friends in the Insurance Industry
Liberals: A temporary rate freeze but no moves that would anger their rich friends in the Insurance Industry

Conservatives: Force drivers to pay extra in order to have the right to sue when injured (p 19)
Liberals: Force drivers to pay extra in order to have the right to sue when injured (p 2)

Conservatives: Increase the deductible to $30,000 to discourage people from exercising their right to sue (p13)
Liberals: Increase the deductible to $25,000 to discourage people from exercising their right to sue (p 4)

Conservatives: Protect drivers who bounce checks, or move territories, or have not-at-fault accidents (p 14) but provide nothing for drivers who face higher premiums solely because of their age or their gender
Liberals: Protect drivers who bounce checks, or move territories, or have not-at-fault accidents (p 5) but provide nothing for drivers who face higher premiums solely because of their age or their gender

Conservatives: Reduce Medical Costs with a "new" program of assessment and care such as a "Pre-Approved Framework" (p 9) and ending "duplication" (p 9)
Liberals: Reduce Medical Costs with a "new" program of assessment and care such as a "Pre-Approved Framework" (p 4) and ending "duplication" (p 3)

Conservatives: Take the right to sue away from injured drivers by introducing a more stringent definition of "serious injury" (p17)
Liberals: Take the right to sue away from injured drivers by introducing a more stringent definition of "serious injury" (p4)

Conservatives: Impose limits on awards that injured drivers can be awarded in court (p17)
Liberals: Impose limits on awards that injured drivers can be awarded in court (p5)

Conservatives: Promise to save millions by "reducing fraud" (p15)
Liberals: Promise to save millions by "reducing fraud" (p5)

Conservatives: Reject public auto insurance system lauded by Consumer's Association of Canada for keeping rates affordable in BC.
Liberals: Reject public auto insurance system lauded by Consumer's Association of Canada for keeping rates affordable in BC.

Liberals and Conservatives are scrambling to distract voters and impress their friends in the industry. Only Howard Hampton and the NDP will provide public auto insurance to all drivers on a non-profit basis. Any surpluses would be reinvested or distributed to drivers.

Public auto insurance lowers rates and keeps them stable. In Saskatchewan, Manitoba and British Columbia - all of which have non-profit, publicly run systems - annual premium increases last year were in the range of seven to 10 per cent.

Public auto pays for itself. Manitoba Public Insurance was given a loan to start up in 1971 and paid it back with interest. The Insurance Corporation of British Columbia doesn't just turn a profit - it subsidizes the government through handling vehicle registration and license renewals.

Ontario drivers are subsidizing a bloated private insurance bureaucracy. Mandatory auto insurance means that every driver has to pay into a system to support over 100 private insurers each with their own offices, executives and shareholders expecting profits. In B.C. in 2001, the average cost of handling a claim was $359. In Ontario the average was over $478.

Private auto insurance does not bring in $1.3 billion in tax revenue. The total auto insurance market in Ontario is roughly $7 billion - and insurers claim that they're not turning a profit. If the government collected $1.3 billion from taxes on auto insurance every auto insurance provider would go belly up.

Don't believe the Ernie Eves/Dalton McGuinty hype. Public auto insurance is the only way to tame rates.

www.publicpower.ca

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