Auto Insurance Canada

According to the recently released car insurance review, Nova Scotia’s policies have not kept up with the times. In the short-term, such antiquated policies can create lower insurance premiums for automobile owners. In the long-term, these policies can bankrupt Nova Scotia.

The report notes that Nova Scotia’s disability benefit for an individual who becomes completely disabled as the result of an auto accident receives only $140 per week – an amount that has not changed since 1974. The report recommends increasing this amount to $250 per week. When one compares this amount to the average weekly unemployment payment of $345, the paucity of Nova Scotia’s disability payment is glaring. Additionally, even if the increase is approved, the disabled individual will reach the maximum limit of his benefits at $13,000 per year. According to Statistics Canada, the poverty line is $18,000 per year, leaving the accidentally disabled well below poverty level regardless of his station in life prior to the accident. The predictable long-term result will be the increased reliance on Nova Scotia’s other public services such as food assistance or rent assistance.

The report recommends a review of the Nova Scotia’s insurance premiums with an eye towards fairness based on age and sex. With respect to age, the National Institutes for Health recently released a study regarding the effects of aging on one’s ability to drive. The study points out the fact that one’s reflexes do slow down with age and that elderly drivers are more likely to commit safety violations than are middle-aged drivers. Current national teen driving statistics show indicate that automotive accidents are the leading cause of death in the 15 to 20 year-old age group, and that two out of every three teenage accidents deaths are boys. While it is patently wrong to discriminate on the basis of sex or age, such startling statistics must be acknowledged. The report recommends removing both age and sex as determining factors in automotive insurance rates.

Perhaps a better policy would be to ensure that all drivers are aware of their responsibilities regardless of age or sex. One way to accomplish this goal would be to require mandatory driver examinations at set intervals. At this time, drivers would be required to show valid proof of insurance in order to register for the exam. Every five years, each driver would need to renew his license. In order to do so, he must pass a written and practical driving exam. Those drivers who do not pass both portions of the exam could receive additional driver’s training while retaining driving privileges. At the completion of the course, the drivers could take the exam a second time. Those drivers who pass are able to renew their license. Those drivers who fail must turn in their license until such time as they are able to pass the exam. Since the exam would apply to all drivers, regardless of sex, throughout their driving careers, both ageism and sexism would be removed from equation. Driving privileges would be granted solely on the basis of competency.

Kudos goes to Nova Scotia for undertaking an analysis of its current automotive insurance practices. The report commissioned by Nova Scotia outlines several baby steps towards improving the system. With a little tweaking, these baby steps could become giant leaps towards equalizing the system.