Car insurance rates are likely to see a hike this year, according to experts.
New Brunswick’s consumer advocate for insurance says rate percentage increases could jump by double digits, with several applications before the province’s insurance board.
“Now we have all those fancy sensors and all those things, so a regular or a small fender bender or accident that we used to have a couple of years ago, now the amount to repair accidents, it costs much more than it used to,” says advocate Michèle Pelletier. “I think in 2020, it’s going to be about the same thing as it was in 2019; insurers are still filing for substantial increases, two-digit increases.”
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A hearing held by the New Brunswick Insurance Board started Tuesday in Fredericton, following an application from Echelon General Insurance Company, seeking a 30 per cent rate increase for private passenger vehicles.
Pelletier says the request has since been modified, and the company is now asking for a 51 per cent increase. She says Echelon is a mid-market company, however, for consumers who have been involved in multiple accidents or people with speeding tickets.
Sonnet Insurance Company, which has a hearing in Saint John in February, is seeking a 50 per cent increase, according to the board’s website. There are notices for other applications seeking increases, as well.
The Insurance Bureau of Canada (IBC) says there’s been a gap between claims and premiums.
“From 2014 to 2018, claims cost have increased over that period 22 per cent. Now if we look at premiums from 2013 to 2018, the average written premium increased 11.5 per cent,” says Amanda Dean, the Atlantic region’s vice-president for IBC.
Drivers who spoke to Global News in Moncton Tuesday didn’t take the news too well.
“I believe that the increases are a little exuberant,” says Gus Dublin. “What we do pay for insurance is probably already high enough.”
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“Car insurance is crazy these days,” says Bruno Gallant.
Charline Bourque always shops around to find the best rate, but still says “(it’s) ridiculous because I find (rates) are quite high already.”
Meanwhile, Pelletier says New Brunswick still has one of the lowest premiums in the country.
Dean says insurance companies across the country are seeing “claims pressures building,” although to varying extents, but notes that increases in New Brunswick are a result of claims filed in New Brunswick.