Car Insurance Canada

Paula Elliot made an appearance before the New Brunswick Insurance Board presenting documentation that suggests drivers overpaid almost $500 million for car insurance during the five-year span. Without coincidence, the Insurance Board had prepared a similar report confirming the overpayment that was already scheduled to be released the day following Elliot’s presentation.

Documentation illustrated a higher pre-tax profit for insurance companies from 2003 to 2007. Profits from New Brunswick during that time period should have hovered around $165 million, instead insurance companies had a pre-tax profit calculated at about $610 million. The excessive payments broken down over a five-year period, means that for each car insured payments were more than a thousand dollars over.

The overages charged to consumers for car insurance could have been a result of partisan appointments according to Liberals, New Brunswick’s opposition. Liberals are placing blame on the Conservative appointee who heads up the New Brunswick Insurance Board.

The board was established in 2005 as a watchdog for consumers over automotive insurance companies. The leader of the opposition, Victor Boudreau, demanded to know in a statement, “When is this government going to stand up in the best interests of those rate payers?” Additional demands by the opposition included the government making much needed changes to the Board, which could include the ousting of the Board’s Chair Paul d’Astous.

No mention has been made of whether a refund will be issued to consumers who owned insurance policies during that period. Most likely, refunds will find their way into the hands of consumers in a lump sum, but they may see a huge reduction in insurance rates in the months and years to come. Rate applications by insurance companies are now being reviewed and at least one, Dominion of Canada General Insurance, made an appearance in the Court of Appeal over rates.