SR Vol 24 No 5, October 2006 - Nova Scotia Barristers' Society

The fine art ofcreating crisisIt was in the February 2003 issue of CI: Canada’s NationalInsurance Magazine in an article entitled “The ImpoverishedPolitics of Automobile Insurance Reform” that GeorgeAnderson, a former president of the Insurance Bureau of Canada,wrote: “What is really needed is a crisis in pricing on the eve of anelection. That is the opportune time, or so it seems, for change.”Opportune indeed… for the insurance industry. In the leadupto the provincial election in August 2003, the insuranceindustry did all they could to try and convince the Nova Scotiaprovincial government to change from the existing tort system tosome variation of a no-fault system for automobile insurance. Inpresentations to the NS Utility and Review Board, the insuranceindustry claimed it was in a financial crisis. The story becameheadline news after insurance companies dramatically raisedpremiums for auto insurance, claiming the increases were justifiedbecause the industry was losing money, and adding that premiumswould continue to rise unless government passed legislationrestricting the rights of people injured in auto collisions. Someinsurance companies threatened to leave Nova Scotia entirely if theirdemands were not met.The topic became a hot button in the 2003 Nova Scotia provincialelection in which the Progressive Conservatives were returned topower, albeit as a minority government. Following the election, theinsurance industry continued to lobby, and lobby hard, for legislativechange resulting in the passing of the Automobile Insurance ReformAct (Act) andthe AutomobileInsuranceTort RecoverySusan HanrahanChair, NS Coalition Against No-Fault InsuranceLimitation Regulations (Regulations) which passed into law on 30October 2003. The Coalition wasn’t happy with this new legislationsince it capped compensation for certain injuries sustained in autocollisions, but we reluctantly accepted the definitions as outlined inthe Act and Regulations as being a lesser evil than the introduction ofa no-fault system. Less than one month later, Cabinet radically alteredthe Regulations so as to deny victims of auto collisions the protectionthat had been set by the Law Amendments process, and agreed uponby vote of the full Legislature, of a reasonably and coherently definedconcept of “minor injury”. My first question upon hearing that newswas “Can they do that?”It appears that, perhaps, they cannot. The Coalition, togetherwith some individuals who have been affected by these legislativechanges, has given notice that we intend to challenge the Act andRegulations on both Constitutional and Charter grounds. Notonly do we believe that the Regulations were amended withoutproper legislative authority, but we also believe that the legislationdiscriminates against certain categories of people, and peoplesuffering from certain types of pain. This challenge is moving ahead.In the three years since the 2003 election, it has become patentlyclear that the insurance industry had no need to cry poor. The24 The Society Record