Minister wants PUB insurance hearing held after consumer advocate appointed

Walter Noel, Minister of Government Services and Lands, has asked the Public Utilities Board (PUB) to wait for the appointment of a consumer advocate before holding a hearing on automobile insurance rate increases requested by the Facility Association (F.A.).

F.A. is an association of insurance companies which provides auto insurance to those who cannot find it through the regular insurance marketplace.

The rate increase requests are quite substantial, as high as 60.5 per cent for third party liability on the Avalon Peninsula. All areas of the province are affected with the requested increases for all coverage combined being 51.6 per cent on the Avalon Peninsula, 28.1 per cent on the remainder of the island, and 37.7 per cent in Labrador.

The PUB has issued a Notice of Application and Pre-Hearing Conference on November 5, 2002 with respect to an Application for Private Passenger and Commercial Automobile Insurance Rates by F.A.

The minister introduced a bill during the last House of Assembly sitting to allow for the appointment of an advocate to represent consumers at such hearings. It was not passed before the House adjourned, but is expected to be when the legislature resumes next month.

In a letter sent today to PUB Chair Robert Noseworthy, Minister Noel said: "The intent of the bill is to ensure that consumers get proper representation at automobile insurance rate hearings, and I would very much like to have the consumer advocate in place to attend the hearing on Facility Association."

Mr. Noel says that he is not surprised at the request for an increase because of increasing claims costs, particularly for pain and suffering, but wants to make sure any increase put into effect is justified.

Media contact: Rick Callahan, Director of Communications, (709) 729-4860.

2002 10 25 12:05 p.m.