When a 16-year-old driving student graduates from SmartDRIVER Training in St. John’s, that new driver can use the certificate obtained from the school to get a discount on their automobile insurance.
But there is no discount on auto insurance premiums for the school that teaches the new driver.
In fact, in the eyes of insurance companies, the driving school vehicles are lumped in with high-risk drivers and forced to pay Facility Association insurance rates.
Paul Prowse, owner-operator of SmartDRIVER Training, says he has two vehicles used to teach new drivers and they are placed in the same high-risk pool as taxis, delivery vans, buses and other commercial vehicles.
“I believe driving school vehicles are the safest on the roads,” Prowse told the Public Utilities Board (PUB) during its insurance review public hearings Wednesday.
“We are all fully trained to teach people how to drive following the rules of the road according to the ‘Road Users Guide’ and the Highway Traffic Act.
“I don’t think we should be in the (high-risk) category. I can’t understand why I am in that category.”
Prowse said that with all his years of driving experience and training, and a clean driving record and no insurance claims, his driving school vehicles are slapped with the highest insurance rates.
Prowse was also a driver and an instructor with Metrobus, and worked with what today is called Safety NL as a driving instructor.
“The insurance companies won’t even look at us if we are not in Facility Association,” he said. “For us right now, for two vehicles, it’s $886 per month. It’s the biggest expense we have. We’ve just retired a third car, a 2012, because that would put us up over $1,500 per month.”
The PUB heard from a number of presenters Wednesday as it wrapped up seven days of public hearings. The hearings are part of the review of automobile insurance ordered by the provincial government.
The review is expected to examine the reasons behind increasing claims costs for private passenger vehicles and taxi operators, and options to reduce these costs, and to examine the impact on rates and implications for claimants of introducing a monetary cap on claims for minor injuries, or continuing with the current deductible of $2,500, or increasing the deductible.
Jeremiah Perry and his wife, Dorothy, attended the PUB hearings Wednesday as “simple people who are very frustrated with this broken system and so we felt compelled to voice our concern.”
Perry, who admitted to being nervous addressing the hearing, said he hopes the review process will result in some justice for ordinary people who buy auto insurance.
Perry said it’s difficult to believe the insurance companies are losing money when he walks into their office buildings.
“My wife and I took some time to visit quite a few insurance firms, as our policy was expiring this month,” he said. “One thing that stood out upon entering, these folks were working in million-dollar facilities, state of the art, lavish — for us not an indication of poverty.”
While waiting on the phone for one insurance agent, Perry said, instead of background music there was an insurance company ad that stated good drivers would receive a 25 per cent discount.
When he asked the agent about it, Perry said, he was told that was meant for people in Nova Scotia, not Newfoundland and Labrador.
Perry suggested the main causes of accidents on the roads of the province are excessive speed and road rage. He proposed that if a better, healthier lifestyle was promoted, people would be in a better frame of mind and there would be less road rage.
He noted that neither he nor his wife smoke or drink, and both eat healthily and exercise.
“Unhealthy habits lead to a very frustrated and raging mindset,” he said. “We have to address the causes of this nightmare.”
He also said he fears the upcoming legalization of marijuana will lead to “zombies on our highways and bi-ways.”
“All the lawyers in the world can stand in this room and mud sling, cap or no cap,” he said. “The fact is we have a bigger problem. Our everyday lives should not be predicated on how many unhealthy restaurants open up, it should be based on healthy living and clear, healthy minds.
“At the end of the day, my wife and I, we wish for a fair insurance system for all participants in honesty and goodwill, if indeed that can be achieved.”