Regulation calls for rate approvals to be submitted on a regular basis

Nova Scotia automobile insurance companies would have to apply to the Nova Scotia Insurance Review Board (NSIRB) for rate approvals and risk classifications at regular intervals, and not just if there is a proposed change to the rates, according to a new regulation intended to be introduced later this year.
“Auto insurance rates should be regularly reviewed, so that rates fairly reflect market conditions,” Nova Scotia Finance Minister Michael Baker said in a release. “We want to ensure that consumers get the best possible rates, given that companies have certain costs to cover.”
As of June 1, 2008, nearly 38% of insurance companies active in Nova Scotia have not filed a full, actuarially justified rate application for private passenger vehicles with the NSIRB since 2004, according to a discussion paper by the Office of the Superintendent of Insurance in the Province of Nova Scotia.
Roughly 62% of active companies have not filed since 2005.
“The proposed regulation will provide assurance to consumers that approved rates and risk classification systems continue to be appropriate with the passage of time,” according to the discussion paper. “In addition, periodic rate reviews will further enhance the stability of rates by reducing the risk of large, infrequent changes in automobile insurance rates.”
There will be no distinction made between large and small insurers, nor will the regulation affect other filing processes, the discussion paper notes.
The office of the superintendent requests input by July 18 on how often and when companies should file detailed applications. The paper is available at http://www.gov.ns.ca/finance/.