NS introduces new auto insurance reform
Nova Scotia unveiled its proposed auto insurance reforms, which will be implemented in two phases over the next two years.
The key aspects of the reforms contained few surprises, including enhanced no-fault, mandatory med-rehab limits of up to $50,000; a new minor injury treatment protocol based on Alberta's current model; and an optional tort product for minor injuries.
Other proposed reforms include:
- A mandatory review of the province's auto insurance legislation and regulations at least once every seven years.
- Limited liability (of up to $1 million) and new priority of pay rules for rental companies.
- Direct compensation for property damage, allowing insured drivers to be compensated by their own insurer for property damage resulting from an automobile collision with a different party (based on the New Brunswick model).
- A new levy that insurers will pay to help volunteer fire departments cover the cost of responding to auto collisions.
- A prohibition against insurers increasing premiums when drivers report collisions that do not result in a claim (even if the driver was at fault).
The reforms are to be implemented in two phases.
- The first phase will be effective Apr. 1, 2012. This includes the enhanced benefits, the prohibition on premium increases when no claim is made, the levy for volunteer fire departments and the seven-year review.
- The second phase of the reforms will be effective Apr. 1, 2013. These include the direct compensation framework, limited liability for rental companies, the new minor injury treatment protocol and the optional tort product.
"We kept our commitment to review auto insurance in Nova Scotia to ensure it meets the needs of today's families," said Graham Steele, Nova Scotia's minister responsible for the Insurance Act. "We've developed a consumer-friendly package of reforms based on the recommendations of the independent auto insurance review and cost analysis from the Utility and Review Board."
The legislative portion of the reforms is contained in the Fair Automobile Insurance (2011) Act, which is to be introduced in Nova Scotia's House of Assembly on Nov. 9.