‘Don’t believe in socialism’: Kenney happy to leave insurance rates to the free market

Alberta’s premier accused his NDP opponents of wanting to bring in public auto insurance Tuesday, a move that Jason Kenney said would result in “Soviet-style” lack of choice, like other provinces.

“We Albertans believe in markets. We don’t believe in socialism,” Kenney said when asked about high rates for Alberta drivers.

“Many other provinces have had the government take over the insurance market and that hasn’t worked out for consumers. And it means you only have one choice, kind of Soviet style…I’m hearing that’s where the NDP wants to take the province.”

Kenney said that premiums have gone up in recent years, but are “now coming down.”

His comments came as politicians and experts grappled over what a new government report means for drivers and insurance companies.

Last weekend, it was revealed that private insurance providers increased their profits by more than $150 million from 2019 to 2020. Overall, the industry profited $1.3 billion last year, the report said.

Another analysis looked at insurance companies’ surpluses in both 2020 and 2021, and found profits continued to grow.

“For the two years it’s approximately $2 billion, $927 million in 2020, and $1.2 billion for 2021,” said Craig Allen of Canadian Institute of Actuaries.


The opposition NDP accused insurance companies of “fleecing Alberta drivers with the help of the UCP” after the government removed their rate cap after the 2019 election.

“Insurance costs are out of control. Alberta families are being penalized for keeping their vehicles on the road so they can get to work or school,” Leader Rachel Notley tweeted.

“If the minister was listening to Albertans he would know their car insurance has gone up 20 or 30 per cent,” said NDP Finance Critic Shannon Phillips.

The official opposition is not calling for government insurance like Kenney suggested, but they do want to investigate why some rates are increasing and to create an all-party committee to look into how to lower costs.

“What we need here are solutions and this committee can deliver that. The fact is this situation is just not sustainable,” Phillips stated.


Kenney argued the industry had no choice but to increase rates on some policies because of increasing awards in personal injury cases.

“The problem we had two or three years back is that a lot of the companies were actually losing money in the Alberta market and they were just pulling out,” he said.

Kenney believes more choice in a free market will determine fair rates, and he denied accusations that he was lobbied to remove the rate cap.

“I don’t recall ever speaking to a lobbyist about this issue,” he said.

Kenney claimed NDP policies made it nearly impossible for some to get insurance, while others were being forced to pay premiums up-front rather than per month.

His finance minister insisted Tuesday that drivers will start to see lower premiums after the government passed Bill 41.

“Seven insurance providers have requested rate decreases for this upcoming year, so that’s positive,” Travis Toews said.

The Insurance Bureau of Canada (IBC), meanwhile, disputes that companies are making higher profits.

“What we are seeing over the last 12 months, as government reforms prices, is people are paying about 1 per cent less for their coverage,” said Aaron Sutherland with IBC.

According to the bureau, Alberta has the third-highest auto insurance rates in Canada, behind Ontario and B.C.

With files from CTV News Edmonton’s Chelan Skulski and CTV News Calgary’s Michael Franklin

View original article here Source