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Insurance rates from all aspects ranging from health, and property to automobile premiums, have been
rising steadily for the last couple of years. With the entry of Covid 19 back in 2020, things took a
different direction, and the insurance rates graph rose so high, breaking records. Over two years after
the pandemic, things have yet to change. Here in Canada, many folks are decrying the high insurance
rates, which seems like they are never returning to normal.
If you are wondering how the rising insurance rates affect the Canadian people, this article is the right
guide to answering that. We’ve sampled the core reasons behind the increase in Insurance rates, the
effects of the high rise in premium rates, and finally, ways to evade the high insurance rates.
Why are Insurance rates rising in Canada?
Before understanding why the insurance rates are rising in Canada, we first have to learn the reasons
behind the rise.
#1.Pre pandemic effects
If there is one thing that paralyzed the entire world’s economy is the 2020 Covid 19 pandemic. The
pandemic blazed through the entire globe, leaving every economic sector numb. Most companies came
to a halt, while others survived just by grace. The Covid 19 effect was a total menace. During the
pandemic, restrictions were put in place to curb or cut down the spreading of the virus. One measure
was working from home and avoiding traveling from one place to another.
This measure reduced the number of cars on the roads since many people chose to work from their
homes. But since the resumption of normalcy, there have been more cars on the roads, and that is now
when the car insurance rates rose. With many cars on the roads, the possibility of accident risk
increases, hence increasing the premium rates.
#2.Inflation
Inflation is the main reason behind the high rise in premium rates. By August 2022, this year's inflation
rate was at 7.6%. This is the record high the inflation rate has ever reached. Not only has Canada felt the
high inflation but the entire globe. With such a huge inflation rate, the price of basic commodities surely
goes up. In that case, the insurance rates are always included. The case is so severe for auto insurance
since inflation has hit it as a sector so hard. The shortage of repair labor and the reduced supply of basic
spare parts have resulted in inflation.
Therefore, if an accident occurs, the claim cost gets more than doubled because of inflation. The insurer
then has no option but to increase the price of premiums to counter the high claim costs.
Effects of high insurance rates in Canada
Termination of coverage.
With the increase in insurance rates ranging from health, auto, and property insurance, many
consumers are forced to act. One way many customers opt for this is to cut down on the coverage completely. This move has seen most insurance companies lose most of its customer as a result of the
high premium rates.
Customers don’t see the need to struggle to pay huge insurance rates, yet at the same time, the cost of
living is almost unbearable. Therefore, the only working solution for some customers is to end the
coverage and terminate the agreement.
How to ease the pain of high insurance premium rates
Yes, the cost of insurance rates is unbearable and almost unmanageable, but experts still believe there
are some ways you can evade that pain. Below are some ways you perhaps have to try out;
Compared and shop around for the best rates
You are advised that before settling down on a given insurer, create time and check out the
market thoroughly. This move will see you settle on the insurance provider with the best rates
ever. Take your time shopping for a premium; a little patience might help.
Pick on a coverage that you need.
Again, when shopping around for an insurance premium, you are advised to only go for
coverage that works for you. Avoid extra add-on coverage that you may never use. Also, ensure
that the price of the premiums is within a manageable range that fits right into your budget and
will avoid problems.
Conclusion
Canadian insurance rate from all angles is rising, and things like not getting back to normal any time
soon. We’ve seen the possible causes behind the high insurance premium cost and what can be done to
evade the high costs. Insurance is important in protecting any asset from the risk that could lead to
financial losses. Therefore, it is something one can never do without.
Aside from that, if you own an automobile, A-protect Warranty Corporation invites any customer willing
to secure their car from unforeseen damages. Extended warranty coverage is what you need aside from
insurance coverage, and that is what we offer. If you need one, do not hesitate to call us on our toll-free
line at +1-866-660-6444 or email us for a free quote at info@a-protectwarranty.com.