The Facts


The insurance industry is asking our government to take away your right to fair compensation if you get injured in a traffic accident. Big insurance says it’s suffering because accidents and injury claims here are rising.

The facts tell a different story. Accidents have actually declined in Newfoundland and Labrador—while drivers here have overpaid premiums, helping boost huge corporate insurance profits.


About the insurance industry

A few big national and multinational companies control most insurance sold in our province. None of these companies are located in NL. The insurance agents you deal with are brokers; they sell you policies from big companies located in major centres in Canada or worldwide.

Declining accident rates in NL

The insurance industry says accident claims are up and that’s hurting their business. But accidents have actually declined steadily in our province in recent years, reports the Royal Newfoundland Constabulary (RNC). In fact, accidents involving property damage declined 25%.

Source: RNC data on motor vehicle accidents involving property damage.

Truth about rising insurance premiums

“You know something as simple as, you know, the physical damage when somebody is in a car accident; the cost of repairing a vehicle today is so much greater than what we saw even five, six years ago. With the technology that’s being introduced into vehicles, you know, a bumper we could have replaced years ago for $7-800…today, that same bumper is costing us $4-5000 because of all of these sensors, and, you know, the backups cameras, and all of the additional technology that’s now being built into those vehicles.

Natalie Higgins of Intact Insurance told the St. John’s Morning Show Friday, April 13, 2018


The Facts: Collision Insurance Driving Insurance Premiums

Chart 2NL2006 – Average NL Premium per Earned Vehicle, Compared to CPI for NL, Total and by Coverage 2006-2017

Source: General Insurance Statistical Agency

The Facts: More Vehicles Carrying Collision Coverage

Percentage of Earned Vehicles Carrying Collision Coverage Newfoundland and Labrador, 2001-2017

Source: General Insurance Statistical Agency

The Facts: More Vehicles Carrying Comprehensive Coverage

Percentage of Vehicles Carrying Collision Comprehensive Coverage Newfoundland and Labrador, 2001-2017

Source: General Insurance Statistical Agency

The insurance company says escalating personal injuries are what’s driving up auto insurance premiums. But that claim doesn’t add up.

Here’s why:

  • There are different components to auto insurance. The one most affected by injury claims is called “third-party liability.” So, if injuries were causing the overall increase in premiums, that’s the portion we’d see going up.
  • The premiums charged for third-party liability have stayed relatively flat for the past decade—because the average cost to insurance companies for injury losses and expenses has been stable since 2001.
  • In Newfoundland and Labrador, insurance companies have benefitted as their payouts for third-party liability declined in recent years—while rising slightly in other provinces.
Read the Report

Big insurance, huge profits