ING, which describes itself as the largest property and casualty insurer in Canada, expects to raise car insurance rates this year, citing rising costs in Ontario and legal uncertainty in Alberta.
Vehicle premiums “are likely to rise in 2008” although profitability has brightened since 2003 thanks to cost-limiting changes in various provincial laws, said Charles Brindamour, promoted Jan. 1 to CEO of ING Canada, majority owned by ING Group of the Netherlands, which separately owns the ING Direct branchless bank.
Brindamour said the car insurance business has been jolted by a Feb. 8 Alberta court ruling that a $4,000 cap on pain-and-suffering awards from soft-tissue injuries is unconstitutional.
The Alberta government is appealing but “there is uncertainty about the ultimate outcome,” Brindamour said during a conference call to discuss ING Canada’s 2007 results.
In addition, accident benefit and bodily injury claims in Ontario have risen. He estimated that rates in the province declined two per cent last year, but ING — operating under the ING and Grey Power brands — raised rates in September and has applied for further hikes in the first half of this year.
“While ING Canada is not a core business of the group — and this is not new — it continues to be a very profitable investment for ING,” he said.
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