Industry concerns over rising auto claims costs in Newfoundland received little response in new legislation tabled by Government Services and Lands Minister Walter Noel. Bill 28, which would amend the Automobile Insurance Act, Insurance Companies Act and Highway Traffic Act, makes no provisions for tort reform and puts new restrictions on underwriting. In a press release, Noel acknowledges that much of the province’s rising premiums are related to claims growth. “Government is taking significant actions to promote driving safety, but the only way to reduce premium prices dramatically is to reduce the cost of claims. A meaningful difference is only likely to occur in the short term if restrictions are accepted on claims, particularly in the area of minor, often questionable, soft tissue claims. However, he says, there was no public support for limiting compensation for minor injuries. Nonetheless, Noel plans to hold public meetings to gauge interest in a system where optional coverage would be offered for pain and suffering or non-economic. “If there is sufficient interest, I will recommend that government commit the resources necessary to undertake a detailed analysis to determine if such a system is feasible for our province.” He notes that Pennsylvania has such a system, where drivers pay as much as 40% less for restricted coverage. In that state, about 55% opt for the coverage currently. Bill 28 also includes underwriting guidelines which restrict insurers from refusing to cover someone based on age, sex, race or marital status, or if coverage has lapsed. Coercive tied-selling has been banned, which is the practice of “tying” the sale of one product to another. Recently Minister Noel publicly criticized The Co-operators for what he considered tied-selling when the company refused to offer “premium rates” to customers who did not purchase another product with the company. The company said that the practice was not tied-selling and related to the higher incidence of accidents amongst those who owned only one policy with them. The only tort reform item in the bill relates to having income loss claims based on net rather than gross pay. The province’s Public Utilities Board (PUB) will be playing a bigger role in rate-setting, and will enforce only a maximum benchmark for this. Other duties such as setting rate territories will move from the superintendent to the PUB. The superintendent, however, gains new controls over the Facility Association, the pool for high-risk drivers. He will be able to veto any part of Facility’s operating plan. Superintendent Winston Morris was also granted one of his wishes with the provision that the industry’s compensation body would be required to pay 100% of unearned premiums in event of an insurer collapse. Other provisions include the upping of capital requirements to $3 million for new insurance companies. And stricter punishments are in place for driving without insurance.