The Public Utilities Board today announced automobile insurance benchmarks will not change for the coming year. The Board, whose responsibility it is to regulate automobile insurance rates in the province, made this decision following review of the 2002 Benchmark Report prepared by its actuarial consultants.
Despite the fact a small reduction in the benchmarks for private passenger vehicles is indicated, the Report does not reflect losses arising from the particularly hard winter this past year. The Board also notes, while the 2002 Benchmark Report uses new methodologies and data designed to better measure provincial experience on a go forward basis, they do not allow a precise comparison between 2001 and 2002 benchmarks. The Board will maintain benchmarks at current levels, while continuing to monitor in the coming year loss experience and other factors impacting rates. Based on this assessment, the Board may elect to convene a public hearing into automobile insurance rates next fall.
The Board also notes ongoing consultations involving Government proposals which could impact the automobile insurance industry.
The Board concluded that many insurers in the Province are currently operating at rates below the 2001 benchmarks. With benchmark limits providing for price variances of 20%, companies have sufficient flexibility to adjust current rates within these limits based on Board approval. Companies wishing to establish rates for 2002 outside established benchmark limits may apply for an independent actuarial review by the Board.
A copy of the 2002 Benchmark Report is available on the Board’s website at www.pub.nf.ca.
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