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Albertans need to make their opinion heard if they have concerns about a proposed hike in mandatory auto insurance premiums, says Liberal finance critic Laurie Blakeman, who attended hearings of the province’s Auto Insurance Rate Board on Wednesday.

“I think Albertans will truly feel gouged if there’s a 37 per cent increase,” said Blakeman, who was disappointed there was so little input from consumers at board hearings held in Calgary on Tuesday and Wednesday. “Everybody is having to pay more for gas, more for utilities, more for rent and more for their mortgage.”

The nine-member board has one consumer representative, Edmonton consultant Merle Taylor, who submitted a report to the board. But all the other presenters who offered input on whether premiums for mandatory coverage should be increased or not were lawyers or officials from the insurance industry.

Board chairman Alfred Savage said even though Taylor was the only person representing consumer interests at the hearings, “our consumer person does a lot of public outreach and represents a lot of consumer groups.”

Canada’s national insurance industry lobby group and many insurance companies are calling for a 37 per cent premium jump on auto insurance premiums, an increase that would see the average Alberta driver hit with an additional $225 in yearly rate costs.

They say they need to raise rates mainly due to a February Court of Queen’s Bench decision that a $4,000 cap on minor soft-tissue injuries is unconstitutional. Insurance companies say if they are forced to pay out thousands more on each claim, it will have a major impact on the profitability of Alberta’s insurance industry.

In wide contrast to the bureau’s estimate, Oliver Wyman actuary Ted Zubulake — who has been contracted by the government-appointed board to analyze insurance industry data — said even if there is no cap in place, mandatory insurance rates should go down by 3.2 per cent. Companies will still make sufficient profits, he said.

However, not all the insurance companies lobbying the rate board want so large an increase.

Meloche Monnex Inc. president and chief executive Alain Thibault made a proposal for drivers to be charged 20 per cent on top of their basic premium, with that money being set aside. If the cap is lifted, insurance companies will use that amount to pay for higher claims costs. If future court decisions decide the cap can remain in place, the money will be refunded to drivers, with interest.

“We think that this approach, first of all, is transparent,” Thibault said. “It certainly reduces the risk of market instability.”

The board will release its decision this summer, and the new rates will take effect Nov. 1.

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Tags: Auto Insurance