11 May 2018 13:30
Photo : Unsplash
The Council of experts on automobile insurance contributions is recommended that the Société de l’assurance automobile du Québec (SAAQ) to limit to 15 % the annual increase in the total of the insurance contributions for the years 2019 to 2021, in a report made public. The SAAQ is currently proposing to limit the increase to 27 % in 2019 and to 15% in 2020 and 2021.
«Although the road safety record has remained relatively constant in recent years, three groups of insured persons, including the owners of a bike to risk, have seen their road safety record deteriorate significantly,» explains Michel Sanschagrin, president of the Council of experts. For these groups, we propose to cap the annual increase in insurance contributions in order to avoid rate shock. «
The Fund fairly capitalized
In addition, the Council of experts asked the SAAQ to review the discount amount of capital that it proposes as soon as 2020 because the financial health of the Fonds d’assurance automobile du Québec is favourable, and that the fluctuations in the financial markets are less important than anticipated.
The Fund has a surplus of funding of $ 3.3 billion against liabilities of $ 8.7 billion, says the Council. The SAAQ says that she will provide the insured with $ 90 million of this surplus per year for three years, a sum of » modest «, according to the Council of experts.
«We understand that the SAAQ may want to keep a safety margin to cope with unforeseen events,» says Sanschagrin. HE adds that a reserve of 20 %, or $ 1.7 billion, is sufficient to cover the future needs of the plan and to absorb the shocks anticipated in the markets. «We therefore urge the Company not to wait more than a year prior to reviewing the amount of reduction of capital if the financial position of the plan continues to be favourable. «
The Council of experts has issued a total of 14 recommendations to improve the proposal for insurance, the SAAQ, although he considers that the increase of contributions complies with the various laws and principles that govern the establishment of insurance contributions.
Among these, the Board proposes that the SAAQ review periodically the vehicle categories in order to establish a pricing robust, credible and stable. Currently, there are 24 categories or sub-categories of vehicles.
It also recommends that you examine the different options available in order to shorten, soften and lighten the process of pricing and forecast for the next few cycles of pricing, the review of the entire pricing process by an independent actuary.
Recognize the right behaviours
The Council of experts also advised the Company to recognize good conduct on the road, and not only penalize bad behavior, to make a match between the table of demerit points and the risk of accidents and identify drivers whose state of health does not allow for safe driving.
The Council would also urge study of the effects of the legalization of cannabis on road safety, to assess the benefits of imposing administrative sanctions and not criminal for drivers with a bac between 0.05 to 0.08 mg per 100 ml and to monitor the gradual influx of cars with driving aids (autonomous cars).