The Fraser Institute released a study yesterday comparing market performance of auto insurance in jurisdictions across North America and in Great Britain.
Data were collected on 15 variables describing the regulatory policy environments and outcomes in each jurisdiction using comparable measurement units. From these 15 variables, five indices were constructed that comparatively measure market quality and regulatory severity across international jurisdictions. Two indices measure market quality outcomes from the perspective of consumers regarding cost and choice; one index gauges market quality outcomes from the perspective of insurers regarding the business climate for auto insurance; a fourth index measures the regulatory severity of auto insurance policy in each market; and the fifth index measures overall market quality combining the scores for each jurisdiction across all 15 variables. This study also examines statistical correlations between variables that can be conceptually separated into distinctly dependent and independent categories.
(Note - some commentors are having problems getting through the spam filter. The word "insurance" is the problem. Try spelling it in abbreviation, and I suspect the problem will alleviate.)
the state run institutions come in last .
Is anyone surprised?
I wish there were some comparisons to Denmark and Sweden or some of the other Euro-anthills.
Boy was I brianwashed. I was under the impression that we had one of the lowest rates in Canada here in BC. I have to be more lery of what I read in the MSM.
I have trouble believing that Alberta, where people are underinsured and where vehicles are not fixed for fear of driving up your rates is ahead of SK. The fact that it is a Fraser Institute study, where any thing from SK is bad, is less of a surprise than they did not rate SGI last.
The fact that for far less than in other jurisdictions an average SK driver can recieve coverage that is as good as anywhere else seems to be lost.
Try being a 23 year old male in Alberta and afford to drive a newer vehicle - you better have one of those high paying oil jobs and live at home so you can afford it.
Well this will come as a mighty surprise to ICBC. No doubt there is flawed methodology here as everybody knows (at least those who read and believe ICBC press releases) ICBC offers excellent return on your more than affordable insurance premiums. And don't forget the top quality service!.
Not surprising to see the (unbiased) Fraser Institute trying to claim that private sector auto insurance is better, contrary to many other studies. What a joke! The graph probably represents profit potential, not quality.
Argh! Please don't get me started on Ontario's privately run (but government mandated) no-fault auto insurance or it will ruin my entire day.
And Indiana is number two. Yee-haw!
That's right Kevink, better to be in Saskatchewan or Manitoba and have all the rest of your neighbours subsisize your insurance. Doesn't matter that a young male with a newer car has a greater chance of wrapping his wheels around a lamp post than Mrs Soccer Mom.
the state run institutions come in last .
Is anyone surprised?
I wish there were some comparisons to Denmark and Sweden or some of the other Euro-anthills.
Posted by: cal2 at October 12, 2006 10:27 AM
ROTFLMAO! There's nothing quite like a true believer. And watching them praise a carefully rigged study by one of their utterly phoney research groups really gets the morning off to a fine start.
You will notice that price was not one of the comparison criteria. Instead, insurance executives impressions were included. Well, in the case of BC, Saskatchewan and Manitoba, how was that variable handled?
No doubt ICBC has had its problems as has any bureaucracy. But no Socred or Liberal (yes, repeating myself) administration has ever seriously considered privatizing ICBC because consumers, auto shops, and insurance brokers are all of the opinion that this is the prefered arrangement.
When I hear middle aged people making the idiotic complaint that ALL young people should be paying more through discriminatory rate setting, and then backing this gem up with fake pontifications about "actuarial grounds", I have to wonder who they think they are kidding. When they say they really like the "convenience" of being able to call an agent in the middle of the night and get their plates switched from their winter heap over to their summer convertible, I have to wonder why they think the rest of us should agree to pay extra for this trivial additional service.
Kevin your full of it. When I moved from Calgary to Vancouver a little over 4 years ago the insurance for my 74 honda cb750 went from $154.00 per year to $67.00 per month for the exact same coverage. The wifes dodge caravan went from $1100.00 a year for 2 million pl/pd and total collision coverage with a $500.00 deductable to for $1165.00 per year she now get minimum coverage required by law. When I was in my early 20's I to had high insurance rates but now that I am older I refuse to subsidize the younger drivers, no one did it for me why should I do it for you?
Pretty confusing chart, I wonder which ones had socialist governments? Duh.
"The fact that for far less than in other jurisdictions an average SK driver can recieve coverage that is as good as anywhere else seems to be lost."
Let me guess, the "average" driver is male, under 26, and has at least one at-fault accident?? The reason these drivers cost less in Saskatchewan is because significant portions of their costs are passed along to people who have none of the above qualifications. How about we compare prices for a 35 yoa, female, no tickets or accidents and see what we come up with?
This skewed comparison belies the fact that SGI subsidizes crappy drivers by charging higher rates to good drivers. Unfortunately, there is no other alternative, so good drivers get the shaft.
New motto?? "SGI - keeping unsafe drivers on the road and with beer money to spare"
Shawn, I agree and said so in my last comment that is in filter land for some reason. Don't know why. Maybe you are not allowed to mention two socialist provinces in one sentence??
I find it interesting that the study takes on the year 2002. When was the most recent outcry over large rate increases in the maritimes and Eastern Canada. Was not there a suggestion of gouging by the private insurance companies at that time. I would bet that if one checked this occurred after 2002.
Yeah the filter has blocked me twice. Whats up?
The spam filter is sensitive to the word "insurance", unfortunately. For obvious reasons!
To answer a couple of questions - 2002 is the most recent year for which data is available. Also - not mentioned is that in that year, Saskatchewan Government Insurance premiums didn't cover the claims - so you had better factor the taxpayer contribution into the so-called "low rates".
kevink, you have trouble believing the study, and your reason seems to be simply that the study is produced by the Fraser Institute. Did you read the complete study? Did you check their facts and numbers? Or did you just write it off because it refutes what you happen to believe? To refute someone's analysis without arguing how any of their facts or methodologies are incorrect, but simply because of who they are, is ignorance at it's worst.
More proof the socialist liars have got to go.
Lets put them all a oneway plane to Cuba.
From what I hear, the variables and outcomes were from the POV of the business side of things, not the service side. Of course, there's a built in contradiction here; what's good for the customer (fair settlements, rates, low yearly rate increases, etc.) is not, generally, good for the company. By definition, they tend to be exclusive of each other.
You heard wrong. The POV is from the consumer side.
I read or at least skimmed over the 49 page report and I must say there was no pulling numbers out of the air. The root cause (I love that term;-) of the automatic knee jerk when the name Fraser Institute is spoken is a pavlovian response to 13+ years of MSM reporting "Fraser Institute, a conservative think tank". The MSM and their political budds throw that in so the reader/viewer is already forming an opinion before the findings or facts are aired.
Speaking of throwing out actuarial evidence, why don't the government monopolies issue life insurance as well?
It's just not faaaaaiirr that a 60-year-old has to pay more for life insurance than a 19-year-old.
After all, it's up to the government to make everybody absolutely equal.
P.S. My car insurance went down when my brain drained southward. Those who don't like Fraser Institute "propaganda" can continue to believe the self-serving government bumpf if it keeps them content.
Budd Campbell: I'm 57. Should I pay the same rate for life insurance as a 18 year old? Or should I be in a different risk/rate category?
Texas Canuck you are correct but it is starting to backfire on the MSM because when the Fraser Inst. gets mentioned I know that whatever they have to say will not be tainted with communistic subversive lies.
Anyone (Butt, Schmuck) who claims that the Fraser Institute is biased, I just dare you to compare their methodology to say, the Lancet report on the 600k dead in Iraq.
I don't really care about the Fraser Institute's variables.
There's only one that counts: how much does it cost for insurance from a company that will actually pay you if you have an accident.
Kevin your full of it. When I moved from Calgary to Vancouver a little over 4 years ago the insurance for my 74 honda cb750 went from $154.00 per year to $67.00 per month for the exact same coverage. The wifes dodge caravan went from $1100.00 a year for 2 million pl/pd and total collision coverage with a $500.00 deductable to for $1165.00 per year she now get minimum coverage required by law. When I was in my early 20's I to had high insurance rates but now that I am older I refuse to subsidize the younger drivers, no one did it for me why should I do it for you?
Posted by: FREE at October 12, 2006 12:01 PM
Your figures are absurdly unbelievable. I live in Maple Ridge and pay just over $1,100 a year for full coverage, including RoadStar. Do you expect people to take these numbers on faith?
No one is suggesting you should subsidize younger drivers. Why should they subsidize you, that's the question.
Budd Campbell: I'm 57. Should I pay the same rate for life insurance as a 18 year old? Or should I be in a different risk/rate category?
Posted by: Me No Dhimmi at October 12, 2006 12:46 PM
The answer is yes, you should pay the same rate. rate differences should be based exclusively on individual accident histories and major traffic offences. Presuming that all young people are dangerous drivers is what the right wing wants, becuase then they can eventually extend it to targetting drivers of Asian backgrounds in order to satisfy populist rage at immigrants. What kind of rates the majority of posters here would want to charge a Muslim driver I cannot begin to imagine. But in any case, their game is discrimination, not actuarial rate setting.
Where is coverage cost breakdown?
ie: avg cost per $1000 of coverage
Where is the average cost of coverage?
For Saskatchewan there is no doubt that the choice is among the worst in Canada. That it has the worst cost however is laughable.
On the question some are raising about, should I pay the same rate as an 18 yr old? The answer is yes. An 18 year old with as many accidents as you should pay the same insurance. If the 18 year old starts getting serious tickets or gets in accidents the insurance should sky rocket.
An older person should have the advantage of 1 recent accident not causing insurance to skyrocket when a otherwise clean record exists. ie: accidents/driving time
You can't fight "ageism" against older drivers and impose it against younger drivers. By the same standard a medical should be manditory for everyone, every 5-10yrs.
The Fraser Institute is certainly biased. It is a right wing think tank. Ignoring this would be like suggesting that unions don't lean left.
Bias however doesn't mean its positions are always without merit. And vice-versa...
Anyone with even basic training in economics should understand the benefits of spreading risk across a larger population. SGI just does not have the ability to do that.
As SGI is not just an insurance provider, but a socio-economic tool of government, the taxpayer portion of covering insurance claims to keep costs low must be higher than the value of SGI to the province in terms of the impact of its operations (usually the argument of head office jobs and some valuation of them is made here, et al.).
If it isn't, then it simply does not make any sense to operate it publically, when consumers can benefit on an aggregate level from spreading risk outside of Saskatchewan. Insurance companies spread risk based on data that is impartial, market based and thus often judged unfair by some. Not all of us are fans of Adam Smith.
Often the real hurdle is ideological. The value of a crown operated SGI is often debatable on what should be inclusive or exclusive of a full environmental cost benefit analysis for consumers (taxpayers).
I doubt that the Fraser Institute has the full range of consumer "value" encompassed within its methodology. It's just a model. Nevertheless, I doubt it is not without its merits.
Cheers!
Leto
Texas Canuck mentioned MSM's phrase: "Fraser Institute, a conservative think tank".
I always heard it as a "right wing think tank" which always surprised me because as there are no "left-wing think tanks" why even mention "wing".
Michael Walker has always said, "If it's important, measure it". He has consistently delivered on that principle.
It is fascinating to read some of the leftie-naysayers above who, as per usual, fail to provide "unbiased studies".
I had a friend once who "won" all arguments with "studies show". The friendship ended decades ago when I suddently asked him to cite a specific study. Nary a one!
Good point above about the Lancet report of 600,000 dead. That's a 6-fold increase over the previous 4-fold exaggeration.
I moved from British Columbia to Ontario. Not one thing changed, including the size of the city, on my i.n.surance in Ontario, in fact the coverage got better for several things including replacement.
However I paid 500 dollars less in the PRIVATE system vs the BC PUBLIC system.
Aside from the fact that the Frasure Institute's game is right-wing propaganda, not credibility, one thing they never factored in is that farmer-owned vehicles are subsidized on average 10% in SK, which would translate into much better numbers, even with Fraser's skewed methodology, were that not the case.
3w.consumer.ca/1538
(Excerpt)
"BC drivers, including many who have never had an accident, would immediately experience a dramatic rate increase of 100% or more if public auto insurance was replaced in the province."
3w.mapleleafweb.com/features/general/insurance/provincial-comparision.html
(Excerpt)
British Columbia:
British Columbians purchase car insurance from the public, Crown corporation ICBC (Insurance Corporation of British Columbia).
According to Statistics Canada, BC experienced a relatively minor increase 7.3% increase in auto insurance premiums between April 2002 and April 2003
Alberta:
Alberta’s auto insurance is purchased through private companies.
According to Statistics Canada, Albertans experienced a whopping 50.1% increase in auto insurance premiums between April 2002 and April 2003.
Statistics Canada’s numbers show Alberta with the greatest increase in auto insurance premiums.
Once insurance becomes a government agency, service to the consumer is secondary. It is now a source of civil service jobs and revenue for the government.
I can understand how MB's Autopac would get a low rating on value for cost and certainly for absolute lack of choice.
Basic rates are low...but the basic policy is so stripped down that most people feel forced to buy the high cost extras for reduced deductable and higher liability.
There are horror stories aplenty about wastefull practices and we can always be sure that with an NDP government if the insurer gets in trouble there will be a bail out from the Taxpayers.
That being said...me experiences in Private Insurance Land have not been pure joy either!
BTW - The FrazerInstitute does "Critical" evaluations! Just because a critical evaluation pokes holes in myths does not make it either right wing or anything wing....it's only just because most left wing assumptions are myths based on pure BS that it seems critical evaluations are attacks on the left or anti-socialist propoganda.
The problem is not the critical evaluation the problem is the total BS of leftist ideology which cannot stand the light of day or honest assessment.
What do you do for a lviing maryjane?
ICBC nicks me for $1400 for insurance for my not-so-new-anymore vehicle. I bought a motorcycle to save on fuel for the summer, and ICBC's annual fee for insurance is $2500. No comeback, no reasons, that's just the way it is. I don't have a choice. Even a lefty ought to be able to see that there is a rip-off happening here.
:::NOTICE:::
I have twice advised you folks that the use of the word "insur..." will send your comments to the spam filter. If you can't read a simple note, don't be surprised if I decide to delete instead of release your comments. I'm busy enough around here as it is.
OK?
Let's just say I work in the private sector, whatever difference that makes to the issue at hand.
Having lived through my early 20's in Alberta I can attest that high premiums kept me from owning a vehicle for a couple years, but is that really a bad thing? I choose that my money was better directed to other things so I went the transit route - something I've heard we should be encouraging anyway :)
Got older, got married, etc, now my premiums are quite affordable for both my vehicles - and the private route even allows for things like mult-line discounts and umbrella liability policies that can allow you to take the minimum liability coverage on your cars without the financial risk.
However nasty market forces once again making me choose the transit route - now its parking prices! Choice is a good thing, but it doesn't mean all of our choices must be made easy or attractive by the government.
As an aside, this reminds me of a friend who hadn't owned a car for years and was complaining about how he was being charged new driver rates. I argued that that's how it works, statistically he was at greater risk of being in an accident because officially he hadn't been driving for years - a risk he flat out denied. Sure enough, he proved the industry true by rear ending a Mercedes within a year of getting back on the road!
Anyone with even basic training in economics should understand the benefits of spreading risk across a larger population. SGI just does not have the ability to do that.
As SGI is not just an ins. provider, but a socio-economic tool of government, the taxpayer portion of covering ins. claims to keep costs low must be higher than the value of SGI to the province in terms of the impact of its operations (usually the argument of head office jobs and some valuation of them is made here, et al.).
If it isn't, then it simply does not make any sense to operate it publically, when consumers can benefit on an aggregate level from spreading risk outside of Saskatchewan. Ins. companies spread risk based on data that is impartial, market based and thus often judged unfair by some. Not all of us are fans of Adam Smith.
...
Cheers!
Leto
Posted by: [hirr]Leto at October 12, 2006
Your training in economics must be very, very, very basic indeed. A province of a million people, probably some 700,000 drivers, is a large enough base to represent every type of driving experience.
You mention the "the taxpayer portion of covering ins. claims to keep costs low". What are you refering to? You claim that "Ins. companies spread risk based on data that is impartial, market based ...". I find this claim very amusing given their transparently discriminatory pricing.
BTW - The FrazerInstitute does "Critical" evaluations! Just because a critical evaluation pokes holes in myths does not make it either right wing or anything wing....it's only just because most left wing assumptions are myths based on pure BS that it seems critical evaluations are attacks on the left or anti-socialist propoganda.
The problem is not the critical evaluation the problem is the total BS of leftist ideology which cannot stand the light of day or honest assessment.
Posted by: OMMAG at October 12, 2006
The Fraser Inst does not do critical evaluations, it produces conservative propaganda. Their methods are always cooked up in order to force the answer that their sponsors want. In many cases their "methodology", if you can even call it that, is just total silliness.
It's part of the total BS of right wing political rhetoric to claim that they understand economics and economic effiency and that others do not. The left in particular, claims the right, understands only redistribution, not wealth creation or production. Nothing could be further from the truth. The right is solely intent on redistributing income, but they want to do it in reverse, from lower to higher income groups.
I have also had experience obtaining ins. with multiple other provinces and SK (SGI) ins. was not any cheaper than either Alberta or Ontario. In fact, I obtained insurance for my car in Alberta when I was in my early 20s. It was completely affordable because I was married at the time. My marital status moved me out of the "high risk" group of drivers and I received a completely affordable rate.
Another very important aspect of this argument is deductables (others have mentioned it). In other jurisdictions, I was able to ask for higher deductables which had the effect of dramatically lowering my rates. In SK, SGI does not provide any options in this respect (or at least they didn't the last time I checked). In Ontario, I asked to have my house and auto deductables raised as high as possible.
Oh yeah, KevinK, as far as being under-insured, as a consumer living in SK, I would love to have the choice.
Budd Campbell, you are nauseating. You denounce everything without backing up anything with hard data. Here, I'll do the same thing:
"Budd Campbell doesn't have a clue about anything, he just spouts NDP propaganda"
Boy, I sure showed YOU! /sarcasm off
As with other morons who've tried the same tactic, the response from SDA contributers is always...show us the proof, not just some empty claims. You're a waste of Kate's bandwidth unless you can back up your drivel.
You folks ALL miss the point.
Mandatory Ins. is the problem. With the corresponding raise of premiums by ins. boards who see no shame, in upping rates every year. Sometimes four times a year.
By now your saying I am nuts by speaking out against what seems a sane practical idea. That every one should be forced to have ins. so that the hurt party is not penalized.
Sounds fine until the reality of there this situation, has lead us by the gluttonous & corrupt, almost to ruin. There is a threshold that when you charge to much the whole edifice of control falls apart. The system becomes untenable.
Less people are covered today than when ins. was not legally compulsory. How you ask? Why no one can afford it anymore. Its become a monopoly. AS with all such creatures eventually once they have the full market. They abuse there patrons. Think cable TV Companies.
For young people & those who have had accidents the price of 2 used cars is now there yearly tribute to companies based on a huge sum a month, with money on a crap shoot of probabilities. Its like playing 3 card monty. A game you never win except the dealer.
With the cost of cars, than this menacing legal theft. Is it any wonder registrations are being faked. Particularly when the government is increasingly using vehicle listing to force payment of other fines or child care payments?
So by forcing people to get coverage on a probability of an accident, they also include punishments for other things not even related to the running or anything to do with a vehicle. This inevitably ends up in people forging & not getting any coverage.
This is a shell game very profitable to the government & companies that support them.100 billion dollar profits, yet more increases by the year forced on the public by compromised boards.
You wonder why people are such crappy drivers as well. Those ins. care less how they drives as well. The poor as usual pay for this scam. Like the poor pay for the PC insanities of smoking.
Its no different than Mortuary laws where even those being cremated are forced by law to buy caskets. Its anti consumer robbery.
Lets not even get into what happens when even if your rear ended trying to get any settlement, if that individual is a minority. Or well heeled. I do remember in Alberta before the compulsory legislation. Indemnity was cheap like borsht.
Instead of the government getting there claws in even deeper in this money well. Cut it out than if people are really hurt use funds to help individuals. As it stands those not ins. anyway, are set free & the government an claim it’s the ins. companies fault. Is it any wonder we are being screwed over by both parties?
Just my opinion, but ask a cop if I am right?
Hassle:
If you want proof, read my 3:02 post. Links are provided. And as always, google is your friend. BTW, how much of the Fraser Institute's funding comes from ins. companies? Think they'll ever tell us? The Fraser Inst. masquarades as an independent think tank, but in reality it is just a big business funded propaganda machine (much like the NCC) fighting to privatize public services.
3w.yourmedia.ca/library_articles/041028_gutstein_fraser.html
lberia: I wonder, how many public policy organizations there are that receive no funds from any source? And even if a group were 100% volunteer with no operating funds at all, the individuals will be swayed by their personal "money trail" - whether someone works in the private or public sector, for example, will have some influence on their beliefs.
So while I wouldn't argue the money trail shouldn't be a factor to be taken into account, it can't be our only criteria in evaluating studies or public policy positions. If it was, we quite frankly could listen to no one.
We'll remember that, Iberia, when one of the many, many other "think tanks" that rely on government funding (unlike the Fraser, which receives none) issue reports supportive of government policy.
So, does being able to buy a five thousand buck house make up for living in Saskatchewan, or what?