Auto insurance overhaul raises benefit caps

The first major overhaul of Nova Scotia’s auto insurance system since 1993 brings the province more in line with other parts of the country, and the government says it shouldn’t affect premiums very much.

Phase one takes effect next April and includes higher caps on mandatory health and rehab benefits; more than double in most categories.

Finance Minister Graham Steele says drivers won’t be dinged for just reporting a crash if they get the damage fixed themselves.

“It strikes many people as just being fundamentally unfair,” said Steele.

According to the government, the automobile reforms will:

• allow drivers involved in a collision caused by another party to deal with their own insurer to collect property damages
• ensure automobile insurers cannot increase premiums for collisions where no claim was made and the driver paid for the damage themselves, even if the driver was at fault
• help victims of automobile collisions access treatment more quickly for minor injuries
• enhance mandatory no-fault benefits including medical, rehabilitation, funeral, death and loss-of-income benefits for all drivers
• give Nova Scotians a choice to buy an optional full-tort product for minor injuries, giving them the right pursue further compensation
• ensure automobile law in Nova Scotia will be reviewed every seven years

“Enhancing no-fault benefits could result in an increase in average premiums of less than one percent,” according to a government document. That would be an increase of as much as $7 per year.

Men and women will still pay different rates, as the government says actuarial studies still show statistics justify premium differences based on gender.

A second phase of changes will take effect in 2013, including the introduction of direct compensation for property damage, which the department says “allows insured drivers to be compensated by their own insurer for property damages resulting from an automobile collision caused by another party. Working with their own insurer allows drivers involved in an automobile collisions to complete the claims process more efficiently and get appropriate compensation quickly.”

People hurt in collisions will be pre-approved for treatment under diagnostic and treatment protocols still to be established.

Another change still to be detailed would give drivers the choice of buying additional coverage for minor injuries that would give them the right to sue.

Details on the auto insurance reforms are posted on the NS government’s web site.