At least that is my uneducated take on things.
I am totally confused by the revised rate review proposal
from SGI
I will admit that I do not understand insurance and how it
works, but I do know this, even with this revised proposal the motorcycle industry
is going to get hit HARD in Saskatchewan.
Motorcycle
dealerships DEMO plates will go up by 21%
So how many dealers will be reducing their fleet of demo
bikes?
How will a rider get to ride a machine to know if it is the
right bike for them?
L – Dealer Plates:
|
4.8%
|
Automobile
|
4.5%
|
Motorcycles
|
21.1%
|
L – Snowmobile Dealers
|
1.7%
|
LV – Antiques
|
22.7%
|
LV – Buses
|
25.6%
|
LV – Buses (Restricted)
|
22.5%
|
LV – Motorcycles:
|
16.8%
|
Cruiser/Touring
|
16.5%
|
Dual Purpose/Other
|
22.2%
|
Sport
|
16.8%
|
Motorhomes
|
15.7%
|
MT – Snowmobiles
|
0.0%
|
PB – Passenger Inter-City Buses
|
14.2%
|
PC – Passenger City Buses
|
16.6%
|
PS – Passenger School Buses
|
26.7%
|
PT – Taxis
|
16.4%
|
Current Annual
Rate
|
Maximum
Cap
|
$1 – 50
|
$25
|
$51 – 100
|
$50
|
$101 – 250
|
$75
|
$251 – 500
|
$100
|
$501 – 750
|
$125
|
$751 – 1000
|
$150
|
$1,001 or greater
|
15%
|
Customer impact
If SGI receives
approval for the increase with rebalancing, as well as the surcharge, it would
mean:
Rate
increases for about 63% of Saskatchewan vehicles with an average annual
increase of $35;
Rate
decreases for about 35% of Saskatchewan vehicles with an average annual
reduction of $21; and,
No
rate change for about 14,000 vehicles.
For information from the Rate Review Request – visit: http://www.saskratereview.ca/index.php?option=com_content&view=article&id=8&Itemid=6
to find out more
Now I have done some math of my own to figure out what the
income to SGI would be for the motorcycle class.
I have used the media figures of approx. 25,000 motorcycles
being registered because Mr. Thompson said the TIAC numbers were not relied on
by them (11,767)
I am also estimating average insurance premiums per year for
demonstration purposes.
If 25,000 riders paid an average of $800 per year, the
income for SGI from those riders would be 25,000 x 800 = $20,000,000
If 25,000 riders paid an average of $ 500 per year, the
income for SGI from those riders would be 25,00 x $500 = $12,500,000
If 20,000 of those riders also insure vehicles and the
average plate is going to increase by $35.00 then those riders are contributing
another $700,000 to the above totals. Am I wrong?
So what are the numbers? Well without knowing how much was
paid out in claims for motorcycle crashes, all I can do is guess – and guess
high to be safe….(all I know right now is that there is just over 9 million in
shortfall apparently)
According to the 2010 TIAS Report – Page 43, section 6 –
Vehicle Factors
There were 308 crashes involving motorcycles. Look at the stats for bicycles!
2010
Stats
|
|||
Bicycle
|
Alcohol
|
Motorcycle
|
|
Property
Damage
|
37
|
653
|
120
|
Injuries
|
126
|
198
|
183
|
Deaths
|
2
|
6
|
5
|
165
|
857
|
308
|
So, if all THREE types of claims were 100% the riders fault
and all costs were borne by the motorcyclist, and the average claim was
$120,000 – the costs would be approx.:
308 x $ 120,000 = $36,960,000 of which 15% is administration costs
roughly (this is an estimation of admin costs).
Now, if as SGI Claims, and the rider is at fault 52% of the
time that number would be $19,219,200
That is $19,219,200
for 52% of the fault for 308 claims of an average of $120,000 each.
I am really struggling with the numbers here, and low and behold Mr.
Thompson finally emailed me; I had put in two request for information since
Monday after Friday’s missed deadline, and got this response this morning:
Don Thompson
7:07 AM (13 minutes ago)
to me
As you may have seen we have resubmitted our rate
request. The last several weeks our
priority has been putting together a revised rate program and submitting it to
the rate panel and putting up on our website.
We are now returning to the many requests for information. We should have it all out next week.
So, the mystery continues as to how SGI can have a shortfall
of $9,000,000 dollars, continues for me
as I just do not understand the methodology or what the real numbers are and look forward to having some of
it explained – how about you?
If any rider who reads this blog is or knows of someone who
can explain the insurance rating system and the real numbers to me, and my
readers, how to evaluate what the real numbers are, I would deeply appreciate
it as I am sure others would.
The Cars/Pickups/SUV against the Motorcyclists strategy in their marketing materials and press releases
has SGI looking like they are attempting to create a hostile environment between rate payers.
I urge you to please support R.A.G.E. in their efforts to thwart the rate hike and have a seat at the table to discuss better injury reduction strategies. You can also purchase any of our patches on www.beltdrivebetty.com and we will donate $2 towards R.A.G.E.
Have a great day everyone – hope you enjoyed this weeks
Busted Knuckle Chronicles…And please go vote for my Beaver Mascot’s name….
Thanks!
Thanks!
Belt Drive Betty
Editor & Rider
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