Consultants hired by the Nova Scotia government are recommending relatively tiny and timid changes to auto insurance including slightly higher payouts for those injured or killed in car crashes and reforms designed to ensure accident victims get slightly better treatment for so-called “minor” injuries. The auto insurance review was commissioned by the province last November. It was led by Ron L'Esperance, a retired civil servant who now works for a Halifax consulting firm.
In their report released today, the consultants note that Nova Scotia and PEI have the stingiest accident benefits in the country. For example, under the standard NS insurance policy, someone who is totally disabled because of a a car accident is eligible for only $140 per week in disability benefits — an amount that hasn’t changed since 1974. The report recommends that such disability benefits rise to $250 per week. However, that amount would need to rise to $660.31 a week in 2011 dollars just to keep pace with those 1974 levels according to the Bank of Canada inflation calculator. Disability benefits vary widely by province. If Nova Scotia implements the consultants' recommendation, benefits would reach a maximum of $13,000 per year. By contrast, Saskatchewan, which has a similar-sized population to Nova Scotia's, already allows people disabled in auto accidents to receive 90 percent of net wages based on a gross annual income of up to $67,762. Saskatchewan has public auto insurance.
Other recommendations include doubling medical rehabilitation benefits from $25,000 to $50,000 along with a substantial increase in death benefits —- changes that would provide significantly less in benefits to Nova Scotians than what provinces with public auto insurance already offer. (For example, in Manitoba, there are no limits on medical payments including rehabilitation.)
The report also outlines other options that would allow consumers to pay lower premiums for lower benefits. But whichever option the province chooses, the report recommends that benefits be reviewed every three years or indexed to inflation. It also urges the province to study the options carefully to minimize the impact on insurance rates.