Re. Sept. 28 letter by lawyer Herbert Fielding, headlined Insurance cap unfair to injury victims:
I read with interest the letter about Alberta’s auto insurance minor injury cap. Fielding’s conclusion as to why the cap was introduced in 2004 is incorrect.
Alberta’s $4,000 minor injury cap was originally introduced as a necessary and reasonable limit on the right to sue.
Prior to the implementation of the cap, court awards for minor injuries resulting from collisions had spiralled out of control, creating a highly litigious and costly legal environment. As a result, claims costs increased dramatically and premiums also rose.
Since the implementation of the cap, Albertans have enjoyed a 16.8 per cent decrease in premiums, while still enjoying robust benefits.
In fact, when the government implemented the cap, it also greatly enhanced first-party accident benefits, which are paid by a collision victim’s own insurer regardless of who caused the collision. Particularly, weekly payments for lost income were increased, and the limit on compensation for medical and rehabilitation rose from $10,000 to $50,000.
The cap has no effect on the compensation that collision victims receive to heal from their injuries. The $4,000 cap applies only to the pain and suffering damages that victims may recover from the at-fault driver, and the cap only applies if the injury is minor.
The Alberta Court of Appeal deemed the minor injury cap an appropriate limit that ensures auto insurance affordability for all drivers.
Upholding the cap is the only way to maintain that affordability. Reversing it would only enrich lawyers who receive a generous percentage of their clients’ court settlements.
Jim Rivait
Vice-President,
Alberta
and The North
Insurance Bureau
of Canada