Many Canadians find insurance “difficult to understand”

According to a recent study conducted for The Co-operators, 66% of Canadians find insurance “difficult to understand,” and 63% are “unsure how premiums are calculated.”
“The findings are troubling, because insurance is an important financial planning tool and part of most household budgets,” The Co-operators president and CEO Kathy Bardswick said in a press release releasing the results. “That’s why we are making a special effort to help Canadians learn more about the industry. We call it Insurance 101.”
One lesson in The Co-operators’ Insurance 101 “class” is about how rates are set. The Co-operators notes how increasing costs for insurers lead to increasing premiums.
“There are many broad factors that affect insurance rates,” The Co-operators notes in its release. “Government regulation and taxes are two. The cost of health care is another.
“Health-related claims paid out under auto insurance policies have more than doubled in the past 10 years. In fact, according to the Insurance Bureau of Canada, auto insurers pay more for medical rehabilitation costs than government health insurance plans or worker’s compensation.
“As these costs continue to rise, insurance premiums reflect the increased costs. Similarly, increased court awards, towing fees, repair costs, insurance fraud and more frequent and severe storms all make insurance more expensive.”