Letter: car insurance rates up 30% for some under Kenney

Thirty per cent.

That’s how much auto insurance rates skyrocketed by for some Albertans at the end of this year, after Premier Jason Kenney and the UCP removed the five per cent cap on rate increases that our Thirty per cent.

That’s how much auto insurance rates skyrocketed by for some Albertans at the end of this year, after Premier Jason Kenney and the UCP removed the five per cent cap on rate increases that our NDP government brought in, taking a “no limit” approach to how much insurance companies could actually raise rates.

The jump was immediate.

Albertans saw a wave of premium increases bordering on price gouging. Over 90% of car insurance companies filed for rate increases as soon as the cap was lifted, and rushed to bill drivers as soon as they could. Of the companies that received approved rate changes, the increases ranged from 4.9 per cent to an eye-popping 29.8 per cent.

It was a nice gift from Jason Kenney, who already slammed families for hundreds of dollars of new costs in his fall budget, including hikes to income tax, property tax, as well as more in school fees, prescription drugs and college tuition.

As usual, Finance Minister Travis Toews trotted out the UCP’s one-trick pony and blamed the NDP, claiming that insurance companies were set to pack their bags and flee the province if he didn’t let them jack up premiums beyond five per cent.

The lobbying effort came out in full force. The brokers, the insurance companies, and the Insurance Bureau of Canada are working overtime to sell quite the sob story: a massive spike in claims costs, not enough options for drivers, etc, etc. It’s tough times for the poor, little ol’ car insurance company.

What a load. These are some of the biggest and most profitable companies in Canada, and they simply want back the power they had to jack up premiums hand over fist.

The truth is that claims costs over the past few years are level, a fact that’s supported by the Insurance Bureau of Canada‘s own data. In fact, an actuarial analysis by Fair Alberta Injury Regulators, an organization made up of concerned Albertans, doctors and legal experts, found that injury payouts have stabilized in the last few years, and even started to dip in 2019. Their actuary specifically found evidence that claims are “not skyrocketing.”

This is further supported by the Alberta Superintendent of Insurance, responsible for all regulatory oversight of insurers operating in Alberta with a specific duty to ensure that insurance companies treat Albertans fairly. In his annual report for 2018, he found on average that the claims ratio for car insurance was 80 per cent across all companies in Alberta. Not the 120 per cent figure the insurance companies trot out on TV.

And while the UCP Government continues to claim they have documents to prove the cap made the car insurance industry unsustainable, they haven’t provided a single piece of paper showing any of these companies would bail if they could–GASP–only raise premiums five per cent every year.

So why remove the cap? Well, in politics, it’s who you know. And Jason Kenney knows an awful lot of people in the insurance industry. Namely, his former chief of staff and campaign director Nick Koolsbergen, who was hired to lobby the Premier on behalf of the car insurance industry just last year. He has Kenney’s cell phone number.

Sounds like a good guy to have on your side… if you’re a car insurance company.

The fact is, these companies turn a profit of tens of millions of dollars each year. They’re used to having carte blanche in Alberta, and they want it back.

Under the thinly-veiled guise of “red tape reduction”, the UCP has struck a panel looking at more regulatory changes that the insurance lobby itself has said “could also change the rate regulation framework that governs how insurers set premiums.”

If costs are going to go up even more, who will Jason Kenney look out for? His friends and interests in big insurance? Or everyday Albertans driving to work?

Knowing Jason Kenney, Albertans should brace for impact.

Jon Carson, MLA for Edmonton-West Henday and the Alberta NDP Opposition Critic for Service Alberta

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12 Comments

  1. I have grown quite tired of the polarized rhetoric, from both sides.
    I know some people who have had these increases. I also know what they druve, and how they drive.
    And that is not to say that some people are not unfairly grouped into categories.
    I just wish Jon Carson would bring forward individual cases, and have each investigated on merits. To identify companies that need investigation based on cases, not statistics.
    Providing this information in detail allows the taxpayer to assess governments ability ( both sides) to represent their constituents, and not just political oratory for personal gain. ( both sides)
    Trotting out a 2018 report is not relevant or productive.
    And if we want to travel this road, will Ms Notely hand over her phone to assess whose numbers she has, and who has hers?
    Please stop wasting our time, and do the work, not do the politics.

    • Alan, you want Mr. Carson to list individual examples to you? His letter would take days to read. You can use myself as an example. Immediately following the non-renewal of this cap I was hit with a 20% increase on both of my vehicles. My wife and I have never been involved in an at fault accident. We drive vehicles made in 2010 and 2012. We both have a spotless driving record. Our rates should be decreasing, not rising.

    • Cecil Allen hahaha that’s hilarious. Your party removes the cap so prices go way up. People get mad and bitch, so they create a panel at a cost of $1 million to tell them why, when they already know in the first place. Now it comes out that insurance companies are not losing money like they claimed and these increases are pointless and needless except to pad their already bursting coffers at our expense.

    • Not really I don’t like the fact that the NDP twists things around to make them selves look good by choice words they could have said UCP didn’t renew instead of taking the caps off and good luck on your new drivers in your family we survived it wasn’t easy

    • NDP: Puts cap in place to help Albertans while still allowing insurance companies to remain profitable (anyone who says they weren’t is bold face lying).
      UCP: Doesn’t renew legislation, thus allowing insurance companies to seriously gouge Albertans to make up for ‘losses’.
      NPD: Points out how UCP decision to not renew is hurting Albertans…
      UCP: Creates another bullshit ‘panel’ to figure out why insurance rates went up and are so high now – costing Albertans dearly.
      NDP: Points out, again, the mistake made by the UCP.
      UCP: NDP’s fault.
      UCP Supporters: The NDP lies and twists the truth! It’s their fault!

      Totally logical, Cecil.

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