Rastin: Province's Election-Friendly Auto Insurance Plan Falls Short

Barrie personal injury lawyer Steve Rastin tells The Lawyers Daily he fears a new provincial plan to cut auto insurance rates is more about electioneering than fundamental change to Ontario's regime. The article discusses the provincial government's recently released Fair Auto Insurance Plan, which promises to implement standard treatment plans for common personal injuries and institute independent examination centres for the assessment of seriously injured victims. The plan also suggests the creation of a Serious Fraud Office by early next year and instructs the Financial Services Commission of Ontario to begin looking at risk factors insurers employ to calculate premiums.

Rastin, partner at Rastin Gluckstein Lawyers, tells the legal news outlet he "wished he was more excited" about the changes. However, he couldn't help but note that the release comes with an election on the horizon, scheduled for June 2018.

"This particular government has had 14 years to get auto insurance right," he says. "And now on the edge of an election, they make a promise that basically says let us in, and we'll fix things. So I'm a little dubious as to whether what they are proposing is going to fix the system or just look good for campaign purposes."

Rastin says the new assessment clinics are eerily reminiscent of the ill-fated designated assessment centres (DAC) that Ontario previously tried, before scrapping them in 2005.

"Who's going to decide who the doctors are? People's lives can be ruined as a result of the wrong assessor, and similarly the insurance companies would say we don't like the people the accident victims are using because they're too sympathetic," he says. "So there's going to be a battle over who the assessors are so the first element of the reforms, these assessment centres, has already been tried and has failed."

Impact of fraud exaggerated

While he acknowledged fraud is a problem in the system as it stands, Rastin suspects the government is exaggerating its impact by pegging its cost at between $1.6 billion and $2 billion per year. "If we have a $9 billion industry and there's $2 billion worth of fraud in it, why aren't the insurance companies hiring whole fraud squads themselves?" he says. "The more your premiums are, the more the insurance companies make. They're in a conflict of interest to drive down premiums and that's why they haven't. So I support any step to get premiums out of the system, but let's not kid ourselves and accept the numbers holus bolus without a review."

Instead, Rastin tells the article's author that the province's auto insurance system needs a "fundamental rewrite."

"Ontario has the worst automobile insurance system in North America, period," he says. "We're the only jurisdiction in the world that has a $40,000 deductible if you're in a car crash for your pain and suffering. We have a system that is fundamentally broken and what I would recommend is a fundamental rewrite to simplify it. People have been tinkering with it for 25 years and they've created a mess."

Auto insurance regime "one of the least effective in the country"

The provincial government's new plan follows "recommendations" by David Marshall, the former CEO of the Workplace Safety and Insurance Board, whose withering report on the province's auto insurance regime declared it "one of the least effective in the country."

"We've introduced a number of important changes over the years that resulted in lower insurance costs for Ontario drivers, but they don't go far enough," said Ontario's Finance Minister Charles Sousa in a statement announcing the new plan. "That's why we commissioned David Marshall to uncover the root of the problem and provide recommendations to improve consumer protection and system efficiency. Based on the findings of his report, we are taking action through the Fair Auto Insurance Plan to help victims tackle fraud and further reduce premium costs," he added.


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