News release

Nova Scotians Get Auto Insurance Rate Relief

The Nova Scotia government introduced a bill today, May 5, that prohibits auto insurance companies from raising their rates. The rate increase prohibition will stay in effect while the complex issues and concerns over auto insurance are resolved. Rates cannot be raised between May 1, 2003, and Jan. 1, 2004.

"This period of stabilization will allow us to complete our public consultation process without the threat of further increases," said Ron Russell, Minister of Environment and Labour. "It's unreasonable to be conducting a review to determine if rates are excessive, and still have insurance companies apply for increases while that process is under way."

The bill also introduces provisions that will enable government to enact regulations to prevent unfair underwriting rules. In addition, the bill extends the period of time an insurance company must wait before applying increases. After Jan. 1, 2004, companies will have to wait 45 days before using new rates after they are filed with the Utility and Review Board. The previous waiting period was 10 days. Any company found guilty of breaching these new provisions will face fines of up to $50,000 for each offence.

"We're concerned that consumers, particularly seniors, are being treated unfairly," said Mr. Russell. "This move will give consumers some measure of relief while we complete our consultation and deliver solutions to stabilize rates for the long term."

Nova Scotians still have until May 15 to share their views and ideas on this issue with the government. Submissions can be made in writing to the Department of Environment and Labour and by e- mail to . Individuals can also call the consumer advocate at 902-424-2794 or 1-800-898-7668.

FOR BROADCAST USE:

The Nova Scotia government introduced a bill today (May 5th) that prohibits auto insurance companies from raising their rates.

The rate increase prohibition will stay in effect while the complex issues and concerns over auto insurance are resolved. Rates cannot be raised between May 1st, 2003, and January 1st, 2004.

Ron Russell, Minister of Environment and Labour, said the government wanted to ensure fairness for consumers while this complex issue is being studied. He said that this new legislation will give consumers some measure of relief while government completes its consultation and delivers solutions to stabilize rates for the long term.

The public consultation on auto insurance is still accepting written submissions until May 15th.

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Contact:

Valerie Bellefontaine
Environment and Labour 902-424-2575 E-mail:
kjd            May 5, 2003         2:30 P.M.