Prosperity under attack by the left!
Once again prosperity is under attack by the left in NB. The Liberals are again beating the war drums, rallying their troops against the people who earn a living in the insurance industry. They claim that rates are too high and the government can offer insurance at a lower cost to the consumer, with a higher level of service.
This is a lie.
Government workers can rarely deliver the same level of customer service as their private sector counterparts. Since their customers have no other place to take their business, government run monopolies have no incentive to focus on best practices or cost reduction measures to retain their current, and attract new, clients. Anyone who has dealt with Service New Brunswick has seen this mentality in practice.
Recently the CBC did a story comparing auto insurance premiums and claims over the last few years. The story focused on how much claims have dropped as a percentage of revenues. While claims do represent just over 50% of all premiums, that does not mean that insurance companies are pocketing the rest as profit. Labour expenses and taxes are about 40% of total revenues for insurance companies, leaving less than 10% of sales for profit. If you were an investor in an insurance company, would you be willing to have your equity lose value? If you were employed in the insurance industry, would you be willing to work for free? Does anyone think the tax man is going to allow companies to stop paying taxes? To continue lowering rates, even a small amount, companies would have to greatly reduce the benefit to one of these groups, all of which are contributors to the province's greater economic well being.
My final argument against the socialization of another New Brunswick industry is the correlation between jobs and the out migration of our citizens. People are not moving to Toronto, Vancouver, and Calgary for better roads, schools, or hospitals. They are leaving for better jobs.
The increased government regulation and ownership of our economy is actually reducing the number of decent employment opportunities in our province. This will not be stopped if the left is allowed to essentially lay off hundreds of our fellow citizens, putting further pressure on an already high unemployment rate. Many of these people will eventually be forced to make a choice: become the latest economic refugees to go west, take lower paying jobs to pay living expenses, or beg the government for "social assistance" and housing subsidies. Is this what the left means when they talk about social justice?
Jason Inness
posted by TheBlueBlogger @ 10:35 AM
5 comments
5 Comments:
You need to look more closely at the Liberal plan--talk to us, disclose all and explain the profits.
Otherwise a hybrid system may be in order. I believe this would utilize exiting agents to sell a public system.
What's wrong with the insurance companies coming clean and explaining their position????
Um, Mr. Inness, a New Brunswick administered public auto insurance system would require employees. Ostensibly, as many employees as the private corporations have now, save for the marketers. In fact, such a system would undoubtedly raise insurance related jobs in NB, as it wouldn't be administered by folks from out of province/country.
I'm not rigid on much, but in my mind public auto insurance* is basically a "motherhood issue". I just don't see the downside.
*Real, prairie-style public auto insurance, not that watered-down, hybrid Liberal crap.
a New Brunswick administered public auto insurance system would require employees. Ostensibly, as many employees as the private corporations have now, save for the marketers.
-Alvy
Please provide me we evidence that a public system would keep existing numbers of employees or create more employement? While you are doing that, could you also provide me the average salary taxpayers would be paying these public servants?
"In New Brunswick, the private insurance industry directly employs 1,350 people in local communities, while supporting a broker work force of 1,050. "
Src: http://www.ibc.ca/home_nb_private.asp
Not to mention all the small and medium sized businesses that cater to these broker? How would this affect the bottom line of the mom and pop bistro's, IT technicians, administrative staff, office supliers, marketing staff and lastely landlords who receive rent from many of these brokers?
Let's face it here, a public insurance system would deal a severe blow to the NB economy, but I wouldn't expect the NDP to really understand anything about the economy.
In 2003 I was paying close to $3,000/year for auto insurance under the facility group. In 2006, because of the PC's policies on insurance, I pay $850.00/year. Changes have worked, even if a lawyer in Halifax who has seen a cut in his billable hours disagrees.
Lastely, the Rober Jones report failed to explain to NBers that brokers in NB had consecutive years of consecutive losses prior to 2001.
I think your conclusion doesn't help your premise. If you have brokers losing money, how is that a good thing.
But to skip the partisan crap, since the liberals are about as left as Reagan was, and if the tories were right then we wouldn't have gas regulation, look at this from the factual point of view.
First, just because YOU saved money from discount insurance doesn't mean everybody does. The figure I saw was 1%. If your premiums went down it may have had just as much to do with market conditions (remember, they went up not because of costs but because of bad insurance investments-you think in those two years there were suddenly massive accidents and car thefts?)
Second, as for direct jobs, according to the committee headed by Weir, the need would still be there for brokers, however, direct jobs would only number 800 so there is definitely a loss of direct jobs.
However, there is a bigger question, and that is the point about investment. According to TD, almost 200 million dollars leaves the province each year. Thats money you and I pay in premiums, that goes to the US, Europe, or Ontario. That's money that would stay here, and if you don't think New Brunswick could use 200 million a year you haven't gone outside much.
If you have satellite television you can watch Manitoba television and you can see all kinds of safety innovations, because these people have a vested interest in keeping accidents low. This is where graduated licenses were born, and there is intensive driver training in public schools, and programs to put alarms in every vehicle. With a private system, well, if you don't have some accidents and thefts then people discount the need for insurance. The insurance company doesn't play a role in your rehabilitation, so to them you are just a number.
And again, there is always the fixation on certain facts, because people don't want to discuss places like Manitoba and Saskatchewan, which saw 2% increases at the time NB was seeing close to 50%. I'm often amazed at how much money people will spend on their ideals.
There is a very simple solution to this, however, and that is simply to have a referendum on it. At the very least I bet you'd see premiums come down even more just before the vote.
The majority of people i talk to are in the same situation I am in. Premiums have decreased steadily since 2003.
I would much more prefer that we take our millions to create a new level of beauracracy in NB to fund education, health and build an infrastrucutre to build a stronger economy.
Give me a competitive landscape over a public system anyday.
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