UberX is here, but are the risks worth it?

UberX has been a trending topic in the news recently for its controversial competition with Taxi Associations, driver by-law infringements and safety.

Much has been talked about regarding the increasingly popular ridesharing program, but how does UberX and auto insurance relate? In an article by CanadianUnderwriter.ca, the Insurance Brokers Association of Ontario (IBAO) warns of the risks associated with ridesharing programs like UberX.

Although the concept of ridesharing is being embraced by many, “At this time, drivers and passengers should know that there is no existing endorsement for a personal lines policy that is available today that would guarantee them coverage or protection in the event of a collision during an UberX experience,” said Michael Brattman, IBAO President.

If an UberX driver does not inform their insurance broker or insurer that they are utilizing their personal vehicle for commercial use, coverage will likely not be extended if a claim should happen while preforming a drive for UberX.

The concept behind UberX is simple; an inexpensive and straightforward alternative, for both the driver and the passenger, to a traditional taxi. It you layer on the complexity of auto insurance and the lack of coverage that a driver would receive should an accident occur, or if the passenger is injured during an UberX experience, the situation suddenly becomes much more complicated.

Are the risks of an auto insurance claim that will likely not be supported by a broker or insurer worth the cost savings for the passengers and the profits made by the drivers? Roughley Insurance Brokers Ltd. suggests the risks outweigh the perceived benefits of UberX.

The IBAO and Roughley Insurance Brokers encourages finding auto insurance solutions that protect ridesharing participants. If you are an UberX enthusiast and you are looking for ways to protect yourself and/or your automobile, your broker can help.

To read the full article from CanadianUnderwriter.ca, click here.

Why do I Need Homeowners Insurance

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I have car insurance, life insurance, disability insurance, critical illness insurance and health insurance. You mean I need more? Homeowners insurance covers fire, theft, liability along with other potential losses.

One of our referral partners, McMurter & Associates, asked us for our advice on homeowners insurance. Homeowners insurance is not an option; find out why by reading the article here.

Trucks a hot target for theft in 2014

Although most vehicle manufacturers would be thrilled to make a Top 10 list, Ford is likely not happy to be topping this list.

The Insurance Bureau of Canada (IBC) recently released its list of the most popular stolen vehicles for 2014, and Ford trucks are topping the list.

  • Ford F-350 SD 4WD PU 2007Trucks are top for theives
  • Ford F-350 SD 4WD PU 2006
  • Ford F-250 SD 4WD PU 2007
  • Cadillac ESCALADE 4DR 4WD SUV 2003
  • Ford F-350 SD 4WD PU 2005
  • Honda CIVIC 2DR COUPE 2D 1999
  • Ford F-350 SD 4WD PU 2004
  • Ford F-250 SD 4WD PU 2006
  • Honda CIVIC SiR 2DR 2D 2000
  • Ford F-350 SD 4WD PU 2003

According to the IBC, although Canada has seen a decrease in auto theft, almost 73,000 vehicles were stolen in 2014. The decrease in overall auto theft is a result of declines across a number of provinces, but some notable increases across the country were an 11% increase in Alberta and a staggering 29% increase in vehicle thefts in Yukon.

Police services caution vehicle buyers to be aware when they are making a purchase, particularly if they are buying a used vehicle. Do your homework on the vehicle, and purchase from a reputable dealer. But caution doesn’t stop with the purchase. Owners need to be taking precautionary steps to avoid theft.

Alarmingly, 20% of thefts occur when keys have been left in the vehicle.


The government is promising cuts, but can they deliver?

There has been no shortage of chatter and speculation surrounding the proposed cuts to insurance premiums being promised by the current Ontario government. And while we could all use a break in the pocketbook, the essential question on everyone’s mind is simply this: Can they deliver on these proposed cuts? If so, how?

photo credit: Alejandro Mallea

Will we really see a full 15 percent cut?

At the 2014 National Insurance Board of Canada Conference (held September 21, 2014 in Ottawa, Ontario), at the session entitled “Taking the Pulse: Where are we at with auto insurance”, panelists discussed and debated whether or not the proposed 15% decrease in auto insurance premiums was truly realistic.

General consensus among panelists was that the proposed 15% decrease in auto insurance premiums would be great for consumers, and would certainly allow the current government to make good on a key part of their proposed insurance reforms, there is simply not enough room to make it happen.

In an article posted on Canadianunderwriter.ca, Barbara Sulzenko-Laurie, Vice-President of Policy Development for the Insurance Bureau of Canada, is quoted as saying:

“… in our conversations with the superintendent of insurance, he’s indicated to us that no one in FSCO believes that there’s 15% that’s in the system (to be reduced).”

For more details on this story, please click through to read the full article. If you would like to discuss how these proposed changes may impact your policy, please call or email us at insurance@roughleyinsurance.com.

The (deadly) risks of taking your eyes off the road

DistractedDrivingWe all know that we shouldn’t do it, but at one point or another most of us are guilty of using our cellphones while driving. Although there is a complete, legal ban on the use of cellphones while operating a motor vehicle in Ontario, the threat of a fine does not appear to be enough to discourage drivers – in Ontario and across the nation – from engaging in this risky behaviour.

In her recent Globe and Mail article, Jessica Leeder reports that “distraction – caused by texting, smartphones and other forces that draw drivers’ attention off the road – is eclipsing impaired driving as the leading cause of crashes and fatalities in many jurisdictions across Canada and the United States.”

 “With the proliferation of technology, it’s hard to say what … this is going to lead to,” said Nova Scotia RCMP Constable Mark Skinner. “We know it’s a problem already. Will the problem continue to get worse?”

Although drivers of all ages are guilty of engaging in this behaviour, teens are reportedly the highest risk group. A 2013 study commissioned by the Ford Motor Co. of Canada reported the following alarming statistics:

  • 93 per cent of teens admitted to distracted driving;
  • 72 per cent admitted to using hand-held technology, such as texting, while behind the wheel; and,
  • 37 per cent admitted to e-mailing while their vehicle was in motion

To read the entire Globe and Mail article, please click here.

Eyes on the Road

texting-while-driving2In an article first posted on Wheels.ca, columnist Henry Stancu gives a breakdown of the statistics of the alarming trend of texting and driving.

“Talking on the phone, texting or using any hand-held device while driving is against the law — but many of us still do it.

In fact, more than 90 per cent of Canadian drivers surveyed confess they do.

But motorists in Ontario may soon be facing stiffer penalties, which could include demerit points along with the current $155 fine for the offence, as the provincial government considers bringing in new legislation.

Transportation Minister Glen Murray told CTV news this week that the government acknowledges everyone is using a handheld device and it’s time to re-examine the penalties relating to their use on the road. …”

Click here to read the full article as seen on www.wheels.ca.

Insurance Industry News

Toronto-area drivers say they would try pay-as-you-drive insurance

~ Posted on canadianunderwriter.ca/news on 2012-04-23

Two-thirds of drivers in the Greater Toronto Area (GTA) say they would likely try pay-as-you-drive (PAYD) insurance if it were available, notes a study by the Pembina Institute, a non-profit think tank that promotes sustainable energy solutions.

The institute’s study offers policy options on how to avoid traffic congestion in the GTA, canvassing the opinions of 1,001 area drivers whose one-way commutes to Toronto took more than half an hour.

Of the approximately 66% of respondents who were open to trying PAYD insurance, 85% indicated they would change commuting habits to find another way to The min & max bet remain the same as the table limits and please keep in mind that you have no way of actually interacting with the chosen blackjack player and you will not be able to tell them how to play their hand. get to work if they had the insurance.

The Pembina Institute report suggests examining “a pilot project for PAYD insurance, ensuring that it is at minimum revenue neutral, but provides strong incentives for drivers to leave the car at home in favour of other cost-effective options.”

PAYD insurance is not currently available in Canada, although Aviva Canada offered a pilot program in Ontario from 2005 to 2010. The Pembina report notes 6,000 Ontarians participated in Aviva’s program, with an average premium savings of 19%.

In the United States, Progressive Insurance offers optional PAYD insurance in 39 states, with an average savings for customers of 10 % to 15%.

The insurance option is most likely to be popular among people who drive less than 10,000 km per year, the report states.

“For insurance companies to offer the program, it needs to have public support — which has been demonstrated by the [Insurance Bureau of Canada] poll as well as by this survey,” the institute reports. It also must be cost-effective and operational at a large scale.

“As the tracking devices can be expensive, the province could implement legislation to reward participating companies, such as tax credits that would be phased out once a specific number of vehicles are covered by PAYD insurance.”

Claims costs for Ontario auto insurers "still out of control": IBC

This article was originally posted here at Canadian Underwriters online on May 28, 2012.

Claims costs for Ontario auto insurers remain high despite the gains realized as a result of the provincial reforms in 2010, notes the Insurance Bureau of Canada’s (IBC) submission to the Ontario Committee Hearings on Auto Insurance on May 28.

“While the September 2010 reforms were a needed first step in reducing the pressure on no fault injury costs, claims costs are still out of control,” IBC’s vice president for Ontario Ralph Palumbo told the hearings.

The Standing Committee on General Government passed a motion Apr. 16 to strike the select committee, which is holding public hearings to propose recommendations to the minority government.

Palumbo listed four reasons why claims costs remain high, namely mediation backlogs, an increase in catastrophic injury claims, an increase in bodily injury costs and the persistence of auto insurance fraud.

“First, there is an excess of 30,000 unresolved claims cases awaiting dispute resolution at [Financial Services Commission of Ontario, FSCO] and these have undetermined costs,” Palumbo said. “Depending on how these cases are decided, it could re-ignite the accident benefits costs spiral.

“I cannot stress strongly enough how this backlog is a major risk to insurance premium stability. Claimants don’t know what their benefits will be and insurers don’t know how much their claims are going to cost.”

Second, Palumbo said, the number of catastrophic injury claims is rising faster than other claims. Between 2004 and 2010, the number of no-fault injury claims rose 28%, while the count for large claims has more than doubled.

Hospitalizations from motor vehicle accidents are down 12% and yet auto insurers are being presented with many more catastrophic injury claims, Palumbo said. “This is a mystery.”

Third, bodily injury (BI) claims costs on the tort side are increasing rapidly. Palumbo said latest available figures show that the frequency of these claims has been rising, as has the average claims cost. BI claims represent more than $2 billion in annual costs.

“It is very concerning that the volume and average cost of these types of claims appear to be rising so rapidly, Palumbo said. “BI is on the same track accident benefits were before the 2010 reforms and more needs to be done to assess the causes and what can be done to alter this concerning trend.”

Finally, fraud persists in the Ontario auto insurance system.

“Many [insurers] are currently in the process of preparing responses to a FSCO [Statutory Accident Benefits Schedule] questionnaire about their internal practices to address fraudulent and abusive claims,” Palumbo said. “Companies have taken significant steps to enhance their claims management process — for some companies this has meant wholesale restructuring of their claims departments. As well, consumers are becoming more educated.

“We want to continue this momentum because society as a whole will benefit from fighting this crime.”