AB.Auto

Question 1

identify the 7 goals of AB auto insurance reform

Answer 1

• private sector delivery model
  Claims related:
• claims handling: effective and sufficient
• medical benefits: make sure they are appropriate
• income replacement: easier access
  Insureds related:
• reduce costs
• stabilize rates: more affordable for AB in the long term
• sustainability: return auto insurance industry to LT competitive sustainability

Question 2

describe the 5 findings of the Alberta auto insurance committee

Answer 2

• high premiums because increasing BI costs, non pecuniary specifically
• no mechanisms to control costs
• injury compensation was often either too high or too low
• health outcomes are worse under tort systems
• health outcomes improved when tort systems were eliminated and replaced with full no fault models

Question 3

name 2 provinces with a pure no fault system

Answer 3

Manitoba and Quebec

Question 4

identify the recommendations of the AB auto insurance committee

Answer 4

• replace hybrid and no fault model with pure no fault model
• introduce “continuum of care model” to promote appropriate medical evaluation assessment and treatment

Question 5

why might a pure no fault system be cheaper and deliver more effective medical treatment?

Answer 5

benefits can be delivered without having to prove who is at fault
- less money to lawyers
- quicker access to medical care

Question 6

describe how AB’s new auto insurance is recommended to work

Answer 6

create a “Traffic Injury Regulator”, including a Board and Tribunal to oversee the 4 arms of accident care and compensation
AIRB 2 CAME
- Claims Administration and support
- Claims Assessment panels for income replacement
- Medical Experts to evaluate injuries
- a reconstituted version of AIRB (Auto Insurance Rate Board)

Question 7

how might the 4 arms of AB’s traffic injury regulator be funded?

Answer 7

by auto insurers who write business in AB proportional to their market share with some contributions of AB government

Question 8

assess the likelihood of a successful legal challenge if AB’s auto reforms are implemented

Answer 8

a legal challenge would probably not be successful because:
- MB and QC already have a pure no fault system
- such systems have been judged to be within the scope of provincial legislative authority
- a challenge under Canada’s charter of rights and freedoms has no merit because all drivers are treated equally
- Morrow vs Zhang upheld the minor injury cap so a future charter challenge would likely not succeed either

Question 9

identify regulatory reforms being considered for AB auto insurance

Answer 9

• switch from ‘prior approval’ to ‘file and use’
• make winter tires mandatory from Oct to March

Question 10

identify problems that AB and ON auto insurance have in common

Answer 10

• rising cost of auto insurance (largely BI)
• inefficient delivery of medical care

Question 11

what has been identified as a primary cause of problems in AB and ON auto insurance

Answer 11

both systems have a tort component which causes
- delays in medical care
- diversion of resources to the legal system

Question 12

identify a similarity in recommendations to address these problems in AB and ON auto insurance

Answer 12

greater focus on timely medical care

Question 13

identify a difference in recommendations to address these problems in AB and ON auto insurance

Answer 13

AB: convert to pure no fault system
ON: keep hybrid tort/no fault system but fix structural flaws by appointing an arms length regulator with powers to enact policies and procedures