29 Jan Your insurance premiums may increase this year… Why?
In 2018, Mother Nature gave everyone, including insurers, a hard time
A recent article in Le Journal de l’Assurance, mentioned that 2018 extreme weather events in Canada resulted in insured losses of $1.9 billion.
2018 turned out to be the fourth most expensive year in claims (since statistics have been available). Ice storms, floods and tornadoes were the main causes.
Here is the data by region or province:
- JANUARY – Winter storms and floods in Eastern Canada / $54 M
- FEBRUARY – Storms and floods in Southern Ontario and Quebec / $57 M
- BEGINNING OF APRIL – Storms in Ontario and Quebec / $85M
- MID-APRIL – Ice storm in Ontario / $190 M
- MAY – Windstorms in Ontario and Quebec / $410 M
- SUMMER – Summer storms on the Prairies / $240 M
- AUGUST – Floods in Ontario / $80 M
- OCTOBER – Tornadoes in Ontario and Quebec / $295 M
- DECEMBER – Winter storms in British Columbia / $37 M
The Insurance Bureau of Canada estimates that for every dollar paid by insurers in residential and business insurance, Canadian governments pay $3 to repair damaged public infrastructure.
More claims and higher repair costs
Auto insurance and recreational vehicle insurance have also been affected by these extreme weather conditions since 2016. All the floods, windstorms and tornadoes we had all also caused damage to RV’s across the province.
In addition, just like cars, RVs are now equipped with increasingly sophisticated security equipment to help with driving. This has had an impact on the cost of claims. For example, old manual awnings have now been replaced by electric awnings with wind sensors. The replacement costs of these have now more than doubled.
Among the other alarming factors, we have seen an increase in the frequency of single driver collisions which now represent 30% of claims costs. These collisions are mainly caused by lack of driver experience. Driver not experienced at maneuvering such a long unit (entrances, service stations, turns in the city, etc.).
In reality, vehicles are getting longer and, unfortunately, no driving license or driving course is required before people are allowed to hit the road. In fact, no matter what the driver’s experience is, no one is immune to a tire burst or going off a soft shoulder when an RV is too heavy.
Jackie Beaudoin, Leclerc Insurance and Financial Services
Source : Article published in Le Journal de l’Assurance (January 19, 2019) / Aviva