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Canada’s Auto Insurers Call for Effecftive Cost Control for Consumers

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The Insurance Bureau of Canada, which represents 95 percent of the Country’s P/C carriers, has reacted strongly to charges that they oppose reforms in the auto sector.

The IBC stated: “An alliance of medical/ rehabilitation providers has issued another press release attempting to blame Ontario auto insurers for every ill currently plaguing the Ontario auto insurance system.”

IBC President and CEO Don Forgeron charged: “This group of rehabilitation providers is misleading the public with false accusations that serve no purpose but to further their own financial interest. The auto insurance system needs to put consumers first. The only acceptable priority is an affordable system that also ensures accident victims get back to health as quickly and effectively as possible.”

The IBC accepts that “Ontario auto insurance is in crisis,” but points out that part of the cause is that the “cost of no fault health care services has gone up more than 40 percent in the past four years, and over the past 12 months, these cost increases have been accelerating. And not enough of this is going to treatment. For every dollar spent on therapy, another 60 cents goes to providers conducting assessments.”

Forgeron added: “Other provinces have much lower accident benefit limits than Ontario. These systems work well and accident victims return to health more quickly than they do in Ontario. Despite the alarm raised by some rehabilitation providers in the system, the vast majority of people injured in car collisions suffer sprain and strain injuries and simple fractures. For these people, C$25,000 [US$22,127] is more than enough to restore them to full health. For those who need more, we have called for provisions to be in place to ensure they get more. The goal is the right amount of treatment for everybody.”

The IBC also noted that “Ontario has the most generous auto insurance system in North America, and Ontario drivers pay at least 25 percent more for auto insurance than drivers elsewhere in Canada. Despite that fact, there is no evidence that accident victims in Ontario are getting any better any faster than those in other provinces. After 6 months, 80 percent of sprain and strain claims in Ontario are still open and people continue to receive treatment. In Alberta, after the same period of time, only 40 percent of similar cases remain open.

“Contrary to accusations from these rehabilitation providers, reducing Ontario’s medical rehabilitation limit will not transfer costs from insurers to the public health system. The province already collects C$142 million [US$125.65 million] a year from insurers to compensate for the cost to the public system of treating auto collision victims. In the unlikely event that auto collision-related costs to public health were to increase as a result of changes to the system, this health levy could be raised.”

The bulletin pointed out that “auto insurers can sell any product that government wants, no matter how generous. But there is a corresponding cost. And it is up to everyone involved in that system to ensure that costs are kept reasonable for the benefit of all drivers.”

Source: Insurance Bureau of Canada – www.ibc.ca


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