York Region collision investigations become financial hot potato

YorkRegion.com
Feb. 26, 2015
Jeremy Grimaldi

York Regional Police is raising the price it charges for conducting collision investigations and offloading it from the region’s taxpayers on to insurance companies.

But before you get too excited, auto insurers are suggesting the move will likely affect auto insurance prices in the region.

Jeffrey Channell, the manager of financial services, said in search of savings, York police discovered only 11 per cent of money spent on investigating was being recouped by the force.

He said that despite the exercise costing the police almost $500, the department was only charging taxpayers $60.

“We’re always looking for efficiencies and ways to improve,” said Channell. “The cost is currently with taxpayers and the option is billing users directly.”

The move is a nod to new Ministry of Transportation charges resulting in fees if collisions on provincial roadways result in damages to signs, the road or guardrails.

More fire departments are also charging for services around the province.

Starting March 30, after the measure was passed by the police services board last week, police will charge insurance companies $260 for collision reports and $490 as of March 30 next year.

Police are estimating the new measures will result in $1.2 million in annual savings.

However, Pete Karageorgos, the director of commercial and industry relations at the Insurance Bureau of Canada, said the cost will have a number of side effects that could be put back onto customers.

“Companies will try hard to minimize price adjustments,” he said. “But insurance, as you know, is numbers driven. This will be reviewed by companies to see what the numbers will be.”

He added that he was surprised by the large hikes — 330 per cent in the next few months and 716 per cent in the next year — adding it might mean insurance companies simply chose to order fewer collision reports from York Regional Police.

“As an adjustor, you don’t need to order reports on every claim,” he said. “Now they may think whether they need collision reports from York Region.”

In terms of falsifying collision reports, he also noted fraudsters may gravitate to areas with this sort of system.

“That could be a factor,” he added, also noting the move could also affect the provincial government’s attempt to cut auto insurance fees by 15 per cent.

However, John Bordignon, spokesperson for State Farm, said the new charge will not change its prices.

Fee amendments do not affect the business as the company does not utilize any of the services/fees that have been updated, he said, adding the company utilizes the general occurrence report that remains unchanged at $60.