Shifting GEARS

I’ve been asked for my wish list for auto reform in Ontario. Although I understand the appeal of a simple road map to the perfect system, the reality of auto product reform is more complex and fluid than that. A number of factors contribute to this, not the least of which is that we are not at the present time in a crisis situation that would limit the options and require an immediate, politically-driven resolution. In addition, we are not creating a new product in a vacuum of stakeholder interests. Finally, the product itself represents an integration of decisions and compromises; like multiple levers operating a complex machine, individual changes must be considered in a context of give and take among competing and conflicting policy goals.

Instead of a simple road map then, what follows is a discussion of what in my view should be the guiding principles for auto product reform. Recognizing where we are today, I include a list of options that, if implemented in accordance with the guiding principles, could enhance and improve a system that works, but still could work better.

AFFORDABLE AND FAIR

The auto product is different in every province in Canada, as a result of being redesigned or tweaked to respond to political imperatives at various times. Having been involved in a host of product reform initiatives in many jurisdictions, I have observed that, while the devil is truly in the details when it comes to outcomes, the real imperative is to ensure the product design decisions are made based on principles of affordability, fairness and indemnification, with the effect of encouraging healthy competition.

The fundamental challenge is how to balance the conflicting requirements that a system be both affordable for consumers and fair to injured persons. In attempting to find that balance, some considerations must be factored in so that the dynamics of the system will operate in the consumers’ overall interest.