The BRIDGE Vol 1 2019 | Director's Corner with Jennifer Power
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Anxious Anticipation
I have spoken before about the current state of the insurance industry and the challenges both insurers and brokers are facing. We continue to believe strongly in the health of this industry and all of its stakeholders. We continue to meet with Government and are anxiously watching to see what changes may come from the automobile insurance review conducted this year in Nova Scotia, or as part of political platforms in the 2020 elections.
The auto insurance industry’s situation today is not without its challenges, for all stakeholders including insurers, brokers and consumers. In New Brunswick and Nova Scotia, rates are increasing by double digits and consumers are seeing the highest increase in premiums in over 15 years. In Nova Scotia, an automobile insurance review is underway by Government, with focus on the product and rate reform. Without some changes, the increasing trend of loss ratios, and subsequently rate increases, will not subside.
The bottom line is the cost of insurance has increased due to the growing expense of vehicle repair, technological advances in vehicles, as well as injury settlement costs. The situation is critical and change needs to happen.
All stakeholders need to come together and have an effective voice with both government and regulators on the issue of availability and affordability. If systemic costs are properly addressed, if we have the regulatory ability to innovate and adapt, and if we all practice strong corporate management - a healthy, competitive market will emerge, and we will see start to see the tail end of this challenging era.
All over the country we are seeing auto insurance reviews and talk of reform as part of political platforms. We are keeping involved in collaboration with the Insurance Bureau of Canada and I was pleased to see the recent study that IBAC commissioned with Deloitte, which showed the importance of Property and Casualty Insurance on the Canadian economy. Here are a few key points from the study:
- The industry employees 126,000 people and generates a net written premium of $47Billion;
- It is estimated that annually Brokers contribute over $5 billion to Gross Domestic Product and $484 million to government taxes;
- Brokers employ over 58,000 people and pay over $3 billion in income.
These are numbers that cannot be ignored by Governments. Strong insurance carriers and a healthy Broker network are key drivers and enablers of a strong economy. I am thrilled to be a part of this ecosystem and anxious to see the changes that may come in the ever-evolving landscape of our business.