A Jiffy Cabs operator claimed that increasing insurance rates are driving him and his fellow operators out of business, and that the Newfoundland and Labrador government is to blame for everything.
“As of the first of March, with the 25.6% increase, my insurance has now gone up over the last four years 234%,” taxi operator Doug McCarthy told CBC. “It used to be with five cars you qualified for fleet insurance [and] now they’ve changed that to 10. A friend of mine has five vehicles. His insurance went from $22,000 to $45,000 – that’s just in one year.”
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McCarthy argued that the Facility Association – an unincorporated non-profit composed of automobile insurers – maintains a monopoly on taxi insurance in the region, allowing it to set high rates unchallenged.
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Originally, the Facility Association was established as a last resort to handle licensed, high-risk drivers that have been turned away by insurers. The group’s rates are reportedly more expensive than other insurers in the market.
McCarthy pointed out that the province’s Public Utilities Board had just received an application from Facility Association for another 29.7% increase, to take effect this October.
He wants the government to right its wrongs and claim responsibility for the unfair rate hikes.
“[The] provincial government created the problem. They’re the ones that, back in the early 2000s said, ‘We’re going to put all taxi drivers in this category and Facility will be the company to insure them.’ So the problem was created by the province – let the province solve the problem,” McCarthy said.
“Right now, for a brand-spanking-new taxi operator in this city, you’re looking at in the neighbourhood of $10,000 to put your taxi on the road – just for car insurance.”
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