Consumer advocate appointed for public insurance hearings

Minister Tom Osborne, on behalf of Government Services Minister Diane Whalen, announced today that Tom Johnson has been appointed the consumer advocate for the upcoming Public Utilities Board (PUB) review into auto, homeowner, commercial and marine insurance, as well as the 2005 benchmark hearings for auto insurance.

Mr. Johnson is a lawyer in St. John�s and a partner with O�Dea Earle Law Offices. As consumer advocate, Mr. Johnson will play a vital role in representing the interests of the people of the province in the public hearing.

"Tom Johnson has worked diligently on behalf of the people he represents throughout his career and I am confident that he will be a strong voice for the people of the province on this issue," said Minister Osborne. "This appointment is part of government�s commitment to ensure consumers have a say in how we achieve adequate insurance coverage at reasonable rates."

The benchmark hearing process for auto insurance is set to start October 4 with a pre-hearing conference to address procedural issues. The broader review of auto, homeowner, commercial and marine insurance, as directed by government, will follow.

Benchmark hearings are held each year by the PUB to set the minimum and maximum amounts insurance companies can charge for the various auto insurance coverages in the three rating territories. This year�s hearing will allow for input on the process the PUB uses to establish the benchmarks, as government committed to do.

In addition, government is moving forward with finalizing the terms of reference for the broader insurance review. The PUB will be directed to identify options for reducing auto insurance costs and to look at a range of automobile insurance issues, such as the use of a cap or deductible on pain and suffering claims and elimination of rating based on age, gender or marital status. The review, which will include a public hearing process, will also examine solutions to the availability and affordability issues surrounding homeowner, commercial (property and liability) and marine insurance.

Industry, insurance brokers and the law society have already been consulted on the terms of reference and feedback will now be sought from the consumer advocate. As well, a closed claims study is well underway which will provide the hearing on auto insurance with the most updated information on recent auto insurance claims.

Government encourages everyone to bring forward their insurance concerns to the hearings.

"These hearings are a forum for consumers to raise any concerns they have with these types of insurance and to present their suggestions on how to address them," Minister Osborne said. "The future direction of insurance in this province will be based on the outcome of these processes. Our objective is to reduce insurance costs in a meaningful way for Newfoundlanders and Labradorians."

Media contact: Melony O�Neill, Communications, (709) 729-0557 or 685-3269

2004 09 24                   4:50 p.m.