Montréal, June 9, 2011 - The Autorité des marchés financiers (the AMF) has released its 2010 report on automobile insurance rates, tabled today in the Québec National Assembly. The report highlights the developments and trends in Québec automobile insurance for 2010, and reflects the health of the industry.
Good year for automobile insurance
The report notes that the automobile insurance industry posted another solid year. Insurance companies generated significant profits-17.3% of premiums written-confirming the positive trend observed over the past 10 years. The excellent experience reported by all insurers, combined with a very low number of claims, helped boost the bottom line. When based on periods of 10 and 20 years, profits stood at 14.6% and 10% respectively. These results are remarkable and even exceed some of the returns expected by insurers for all their activities.
The past year marked the end of the distribution of replacement guarantees, now known as replacement insurance. The report discusses the distribution of replacement insurance by car dealers and certified representatives between October 1, 2010, the date when the new rules went into effect, and December 31, 2010. Nearly 12,000 replacement insurance policies were sold for a total of $16.9 million in direct premiums in the last three months of 2010.
Automobile insurance products in Québec continue to be abundant and diversified. The underwriting capacity of insurers operating in the province is more than sufficient to meet consumer demand. Several factors are behind the competitive nature of this market, including a downward movement in rates for the eighth consecutive year and a growing number of insurers operating in all sectors of automobile insurance. Québec-chartered insurers still dominate the home market, grabbing 63% of the $3.1 billion of automobile insurance premiums written in 2010.
Good for consumers
This situation benefits consumers. The AMF encourages consumers to ask for bids from different insurers and brokers to be able to compare prices and services. In addition, by comparing insurance premiums and asking for additional information about applicable terms and services offered, consumers help maintain healthy competition in the insurance industry.
More information about automobile insurance in Québec is available in the report (pdf - 2 MB)This link will open in a new window (in French only).
The Autorité des marchés financiers ("AMF") is the regulatory and oversight body for Québec's financial industry.
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