Insurers reported record profits in 2020 and 2021. But they are telling the Government this will change going forward as cars are back on the road.
Profits Were Skyrocketing Pre-COVID
The insurers still made significant profit in 2017 and 2018. They made exceptional profit in 2019. These earnings were all pre-COVID with everyone on the road!
Insurance Sleight of Hand Hides Profits
When insurance companies have higher expenses it reduces their profits. But the insurance companies’ own statistical agency (GISA) says they reported exaggerated expenses (See page 14 to 16 of General Insurance Statistical Agency “2021 Actual Loss Ratio Exhibit Private Passenger Automobile Excluding Farmers Atlantic Provinces”).
So they have made more profit than they are already reporting.
Permanent Increase in Insurance ProfitsWorking from home will permanently decrease accidents and increase insurance profits. Accident rates in Nova Scotia are likely to stay lower than before COVID. Statistics Canada estimates that the number of people working from home has permanently increased over 600%. Before COVID, 4% of Canadians worked from home. Two Statistics Canada studies estimate this has likely permanently increased to 25% [1, 2]. This means a lot less cars on the road, and fewer accidents.
NOTE: This data comes from page 17-20 of July 27, 2022 Bulletin No. 2022-37 of the General Insurance Statistical Agency (GISA)
IMP: According to GISA, the insurance companies overstated their expenses, so the numbers are actually even better for the insurers.
* = after claims and adjustment expenses