Frequently Asked Questions


About the Board



Established by government in 2004, the role of the New Brunswick Insurance Board (NBIB) is to regulate auto insurance rates for all companies doing business in NB.

The regulatory process consists of the Board receiving rate filings from insurance companies once a year that indicate what rates the companies want to charge their customers in the coming year. The filings are reviewed and ultimately approved once proposed rates meet the criteria that they are ‘just and reasonable’.

Although the Board was created by government, it was established to be an independent body, operating as an administrative tribunal, separate from government. The Board’s activities are reported through a separately published annual report and the Board appears before the Legislature’s Standing Committee on Crown Corporations to answer any questions that MLAs may have.



The process of developing insurance rates is complex. It involves looking at current and past results, applying sound actuarial standards and principles to that data, developing reasonable assumptions about future results, and then putting all this information together to determine what rates are required for the next year to cover expected claims, expected expenses and a reasonable return on investment.

Because of the need to use professional actuarial judgement, there is no one ‘correct’ prediction for required future rates. Accordingly, the Board reviews all of the elements that go into the pricing model to determine if the companies have ‘justified’ their proposed rates for the coming year. The analysis of the data has to be prepared in accordance with accepted actuarial principles and the assumptions that the actuaries make have to be ‘reasonable’.



The filing process begins when the Board issues its annual revised filing guidelines in late spring. The guidelines are designed to ensure that the rate filings provide sufficient information for the Board to determine if the requested rates are just and reasonable. The Board review begins as soon as a rate filing is received. Staff start the process of analysing the information contained in the filing. Rate filings contain a significant amount of financial data and staff ensure that the information filed is correct, complete and in compliance with the guidelines.

There is a lot of variation in the size of the rate filings based on the expected premiums or the number of vehicles covered. Some filings might cover a few dozen vehicles and others might involve thousands. Larger and more complex rate filings are referred to the Board’s consulting actuaries for in-depth review and analysis of actuarial standards, principles and assumptions. Smaller filings are reviewed in-house and are reviewed primarily for accuracy and reasonableness.

The file review process often results in discussions with the companies that result in adjustments and changes to the filings. This is because, as stated above, rate filings contain a lot of information. Filings can contain mathematical errors, unreasonable assumptions or errors based on misunderstandings related to the filing guidelines. Once the filing is considered correct and complete it is submitted to the Board for consideration.



Although private passenger vehicles make up 80% of the overall auto insurance market, the Board does review rates for all classes of vehicles including commercial vehicles, interurban trucks, ATV’s, taxis, snow machines, motorcycles and other types of vehicles as well. These other classes of vehicles tend to have fewer vehicles insured and the rates that companies charge for insurance change less often.



No. Although all rate filings are subject to review and are ultimately approved by the Board, appearing before that Board at a hearing is only required in specific circumstances. The Insurance Act specifies that if an insurer is seeking an increase of more than 3% over currently approved rates then it must appear before the Board. Even if a rate filing is not in excess of the 3% threshold, the Board can still require an insurer to appear before the Board in order to better investigate the proposed rates.



Once a decision to hold a hearing has been made, either through the automatic triggering process (as described in question 5 above) or as a result of a decision of the Board, a notice of hearing is issued by the Board providing the details of the upcoming hearing. The notice of hearing starts the clock on the formal hearing process.

The hearing process used by the Board is designed to allow interested parties an opportunity to review the rate applications subject to a hearing, to ask questions of the company making the rate filing and to make representations to the Board with respect to the rate filing.

Once all of the evidence has been received by the Board from the various parties, the Board will deliberate and render a decision on each rate application that has been subject to a hearing.

Decisions of the Board are posted on this website.

For more detailed information on hearing processes please click here.



Anyone can apply to have intervenor status during the rate hearing process. However, a request for intervenor status has to provide the Board with the purpose behind the request. If the Board determines that the request will add value to the hearing process, then the request for intervenor status will be granted.

Over the past number of years, the Office of the Attorney General (OAG) has intervened during each rate application subject to a hearing. The OAG and the Office of the Consumer Advocate for Insurance have provided representation on behalf of the citizens of New Brunswick during these rate hearings.

For more information on applying to be an intervenor please click here.



The Board consists of a Chair, Vice-Chair and 8-10 members. The membership of the Board consists of a cross-section of New Brunswick citizens from all regions of the province and with a wide ranging variety of backgrounds. Board members, including the Vice-Chair are appointed for three-year terms and can be reappointed. The Chair is appointed to a non-renewable ten-year term.

Please see this section of our website for information on our current members.



Appointments to the Board are not made by the Board but are rather made though an Order-in-Council process. If you are interested in applying for appointment to the Board, you should watch for upcoming openings listed on the Agencies, Boards and Commissions website: http://www2.gnb.ca/content/gnb/en/corporate/abc.html



This is often the most difficult question to answer because of the significant differences in automobile insurance across Canada.

The other Maritime Provinces offer the best comparison. Nova Scotia and Prince Edward Island have very similar approaches to auto insurance. Like New Brunswick, they are each based on a private sector, competitive insurance marketplace and policy conditions and benefits are very similar. There are some variations in premium levels due to differences in driving conditions, weather, road systems and urban centres, however the average premium levels are generally very close (i.e. within +/- 5%).

Newfoundland, Ontario and Alberta are the other three provinces that have private sector insurance. Although, average insurance premiums are higher in each of these three provinces than in NB, the insurance product offered is somewhat different. For instance, where the three Maritime Provinces utilize a cap on soft-tissue injury insurance claims, Newfoundland utilizes a deductible system where the first portion of a claim is deducted from the total claim. Ontario and Alberta both offer other variations and may offer higher benefits for certain types of claims. Additionally, Ontario and Alberta have very different driving environments. This can lead to higher claims, especially in large urban centres such as Toronto, Ottawa, Calgary and Edmonton.

The other four provinces; Quebec, Manitoba, Saskatchewan and British Columbia utilize a public sector model for mandatory auto insurance coverage. This means that you must buy your mandatory insurance coverage through the government supplier. Optional coverages can be obtained from private companies or through the government supplier. Generally, the overall cost for a complete insurance package (mandatory + optional) in these provinces is somewhat higher, although again there are significant differences in the auto insurance product that can account for the variance in price.

All provinces in Canada have some form of oversight model for auto insurance. Some provinces have a stand-alone board similar to NB and others utilize some other regulatory body. In NB, the government has decided that auto insurance requires more stringent oversight in order to avoid another crisis similar to what occurred in 2002-2004. This crisis led to the creation of a stand-alone Board that reviews rates on an annual basis.

Regardless of the model used, the various bodies tasked with oversight of auto insurance rates in Canada work together through the Canadian Association of Auto Insurance Rate Regulators (CARR) to share best practices. CARR works to ensure that the Canadian driving public is well served with respect to auto insurance rate regulation.

For links to other provincial rate regulators click here.



Consumer



An insurance policy is an important but sometimes confusing and complex product.

At its most basic level, insurance represents the process by which policy holders ‘pool’ or combine their risks with the claims of the few being paid by the premiums of the many. Insurance companies have grown their businesses over the years by acting as facilitators for this pooling mechanism.

Insurance companies are responsible for evaluating potential risks and determining the probability that an insurable event will occur. The insurers then must determine what the insurable event will cost. Finally, by multiplying the event cost by the total number of claims the insurer will have an estimate of the losses expected in any given year. Once the company has an estimate of expected losses, they are able to determine the premiums that they must charge to their customers in order to cover their expected losses and expenses.

The process for evaluating the potential claims expenses is relatively complex and involves actuaries who review historical data and apply statistical processes to develop estimates of future claims. This is where the New Brunswick Insurance Board (NBIB) does its work. With respect to vehicle insurance, the NBIB has a mandate to ensure the work of the actuaries has been justified and the premiums that insurance companies want to charge consumers for the vehicle insurance are reasonable.



All vehicles licensed to be operated in New Brunswick require a minimum level of insurance coverage. This includes all types of vehicles including cars, trucks, ATV’s, buses, snowmobiles, motorhomes and others. This minimum level of coverage is usually referred to as mandatory coverage and includes the pieces of the policy that protect other drivers from the financial consequences of mistakes or accidents that are caused by the operation of your vehicle including the costs of damage or injuries. Mandatory coverage is also required to protect you from the financial consequences of mistakes or accidents caused by the operation of other vehicles that do not have insurance coverage.

Most consumers also opt to purchase additional insurance coverage that will provide additional protection from the financial implications of other insurable events. The other events might include theft or damage to your own vehicle, some types of injuries or damages to your vehicle relating to an accident where you are wholly or partially at fault, or events that are completely beyond your control.

As noted above, the mandate of the NBIB is to ensure that auto insurance pricing is justified and is reasonable. This involves examining the proposed prices that insurance companies want to charge for all of the various parts of the auto insurance policy.

For more detailed information on insurance in NB please refer to the website for the Financial and Consumer Services Commission: www.fcnb.ca.





When insurance companies develop their pricing models, they take into account a lot of different factors that can affect the risk that each consumer represents. These factors include, for example; driving record and experience of the vehicle operator, type of vehicle, use of vehicle, geographic location, historical experience of the insurance company and driver education for new drivers.

As noted above, insurance companies are pooling the premiums from many customers and making a promise to pay out of that pool of funds the claims made for insurable losses. In general terms, an insurer will produce a base rate by determining expected losses and expenses and dividing by the number of customers that they expect to have.

For example, Company A has done an analysis that shows expected losses and expenses to be $8,000,000. Company A expects to have 10,000 customers next year so in this case the base rate would be $800. Company A will then adjust the price paid by each customer up or down based on the factors mentioned above. A driver with a very good driving history might have their premium adjusted downward to $700 and a driver with a number of recent claims might have their premium adjusted upward to $900 (Example for illustrative purposes only).



No. Fault is still determined when an accident occurs.

Regardless of fault, under current NB insurance rules, you will be dealing with your own insurance company either through Direct Compensation Property Damage (DCPD) if you are not at fault or through physical damage coverage (if applicable) if you are at fault.

New Brunswick introduced DCPD a number of years ago for circumstances when you are not at fault. What this process means is that you deal with your own insurer for any claim where you are not at fault. DCPD allows insurance companies to better match the risks that are insured with the premiums that are charged to customers. Prior to DCPD, insurers had to price their premiums based on an ‘average’ vehicle because they had no way to know what vehicles might be involved in future accidents. Under DCPD, your insurer can base your premium on the actual vehicle that you drive. Additionally, DCPD allows customers to deal with their own insurance company only instead of having to deal with another company in the event of an accident.

In the event of a claim, if you are found not to be at fault, the claim will not have an impact on your driving record.



There are a number of ways that you can try to reduce the amount that you pay for vehicle insurance.

The best way to keep your premiums down is to maintain a good driving record over a number of years. Be a careful driver to avoid accidents, drive safely within posted speed limits and obey traffic laws. Although many insurers will have some limited tolerance for minor traffic violations, repeated offences will have consequences for your premiums. Some insurers also offer ‘accident forgiveness’ options with their policies but you should contact your insurer for more details about the availability of this option.

Other options for reducing rates include:

  • New Driver Education – new drivers are entitled to a ‘New Driver Discount’ which grants the equivalent of three (3) years driving experience upon receiving their license for the first time. This experience bonus is extended to six (6) years if the new driver has completed certified driver training. This extra experience bonus is very valuable in reducing premiums for new drivers but will be lost if the new driver has a traffic violation or an at-fault accident within the initial 3 year / 6 year period. If this happens the driving record will be adjusted to reflect the actual number of years licensed.


  • Competition – The New Brunswick insurance market is very competitive with more than a dozen major insurers and a number of smaller insurers competing for your business. This competition combined with other factors such as business models, past results, niche marketing, group discounts, loyalty discounts mean that different insurers may provide you with insurance quotes that vary significantly. Just as you would shop around for any major purchase, you should regularly shop your insurance business.


  • Other Discounts – There can be other discounts available from various insurers. These could include discounts for anti-theft devices, winter tire installation, low mileage usage or the installation of telematics devices. Telematics is a way for the insurance company to monitor actual usage of your vehicle and offering you a discount based on good driving behaviours. When available, the usage of these devices is entirely voluntary and the insurance companies are only able to offer discounts and not increase your premiums.


  • Policy Options – By reviewing your circumstances and insurance requirements with a licensed insurance professional, you may be able to significantly reduce your premiums. For example, changing your policy deductibles may have a significant impact on the price of your policy.




The first step when dealing with an issue that cannot be resolved with your insurance company is to contact the Office of the Consumer Advocate for Insurance. This Office was set up to deal with consumer complaints and to help facilitate the resolution of issues between insurance companies and consumers.

The Consumer Advocate can assist with questions relating to all types of insurance not just vehicle. You can contact their office by phone: 1-888-283-5111 or by visiting their website: www.insurance-assurance.ca



Insurance is the pooling of premiums. Many customers pay into the pool and a few will make claims out of the pool each year. The pool of funds needs to be replenished each year and in some years there will be fewer claims or the claims that are made might be smaller. The pressure to replenish the pool of funds will go down in the year after this occurs. The opposite also occurs and the pool of funds might be smaller than it should be.

Each year, insurers file rate applications with the NBIB that detail the experience of past years and provide their estimates of future requirements. These future estimates are based on actuarial analysis and are subject to review and approval by the Board. Ultimately, each year the rates required by insurers will change from previous years and may result in rates changing somewhat from year to year regardless of your own personal circumstances.



Direct comparisons are difficult because of differences in the auto insurance product and benefits for consumers that exist in other provinces.

The best comparison is between NB, NS and PEI where there are very similar benefits and marketplaces. The most recent data (2015) shows that average premium in NB is approx. $759 per vehicle. In NS the average is $775 and for PEI it’s $756. In Newfoundland the average premium in 2015 was $1,075 but NL doesn’t use a cap on soft tissue injuries like NB, NS and PEI.

Average premiums in Ontario are much higher, in excess of $1,500 per vehicle but the package of benefits is significantly different and driving habits and results can be very different in large cities like greater Toronto and Ottawa. It’s a similar situation in Alberta with average premiums in excess of $1,500 and two large urban centres in Calgary and Edmonton.

Comparisons with the other provinces (QC, MB, SK, BC) are even more difficult because they all utilize some form of public / private auto insurance mix. Generally mandatory coverage is only available through a government entity and optional coverages can be purchased through the government entity or through the private sector. Overall, average premiums for mandatory coverage only would be higher in these provinces than in NB although again direct comparisons are difficult.



Please refer to the FAQ in the section about the Board



Industry



The New Brunswick Insurance Act can be found here. Some key sections of the Insurance Act and regulations relating to auto insurance are:

  • Annual Rate Filing Requirement –Section 267.2(1)
  • When an Insurer must appear before the Board – Section 267.51(1)
  • Introduction of DCPD 2005 (Section 254.1)
  • Prohibited Risk Classifications – Age, Gender, Marital Status – (Regulation 2004-139)
  • Prohibition – Lapse in Coverage (Regulation 2004-139)
  • Minor Injury Regulation (MIR) limit increase 2013 – (Regulation 2003-20)
  • Also see MIR Guidance for Rate Filings – NBIB Decision and Bulletin


This information can also be found in the technical notes on the filing summary sheets that can be downloaded here.



Use the links below to get details on preparing and submitting a filing:





As legislated in the Insurance Act section 267.2 (1), companies must file at least once every 12 months from the date of last filing. Currently private passenger filings are due no later than September 15th of each year. A detailed company specific filing schedule is sent via email to each insurance company at the beginning of every calendar year and includes the due dates for Commercial and Miscellaneous filings required.

The mandatory filing schedule can be found here

Information about filing dates, deadlines here.



There are 4 types of rate filings that can be submitted to fulfill the mandatory annual filing requirement. The details of each type and when they are applicable are as follows:

RFG-1 Major Rate Filing is for a proposed change in rates and actuarial justification is required due to the nature of the class of vehicle (private passenger) or where the level of written premium is above a certain threshold.

RFG-2 IAO Rate Filing is for companies that want to adopt the most recent rates that have been developed by IAO Actuarial Consulting Services (IAO) and approved by the NBIB.

RFG-7 Simplified Rate Filing may be submitted where there are no changes proposed and only if the company is not required to produce another type of filing. Private passenger and commercial filings are not eligible to submit a simplified RFG-7 filing. Interurban, motorcycle, taxi, ATV and snow vehicle classes have restrictions on how often a simplified RFG-7 filing may be submitted.

RFG-8 Minor Rate Filing may be submitted where there is a proposed change in rates but full actuarial justification is not required because the amount of written premium is below a certain threshold. In some cases, an RFG-8 filing must be used for filings with no proposed changes in current rates. Private Passenger vehicles are not eligible to file an RFG-8 minor rate filing.

Companies do need to file annually even if there are no changes proposed.

Industry should refer to the specific filing guidelines for details



Yes. The filing guidelines do differ for some classes of vehicles and are summarized in the table below:

Vehicle ClassesRate Filing ChoicesEligible to file RFG-7 Simplified FilingPremium Threshold to file an RFG-1
PPVRFG-1 or 2NoNA
CommercialRFG-1, 2 or 8No≥$1M
Interurban/Motorcycle/ATV/Snow VehiclesRFG-1, 2 or 8triennial≥$0.75M
TaxiRFG-1, 2 or 8triennial≥$0.5M
Other MiscellaneousRFG-2 or 8YesNA


Other miscellaneous vehicle classes include: ambulance, antique, camper/trailer, motorhome, other personal, other public, private bus, public bus, and school bus. These classes may file an RFG-7 simplified filing annually unless rate changes are proposed.

IAO is required to file an RFG-1 major rate filing for all classes of vehicles.

Refer to the 2017-003 information bulletin.

Separate filings must be submitted for each vehicle class with the exception of commercial/interurban which can be combined. Separate emails must be sent for each company and each filing.



These type of filings are considered non-rate filings and are not considered as part of the annual filing requirement. Submission requirements are outlined for these in the Filing Guidelines.

The type of filing for each is as follows:

RFG-3 – Rate Group Table Update

RFG-4 - Rating Rule Changes

RFG-5 – New/Amended Endorsements

RFG-6 - Underwriting Rule Changes

These changes may also be included with an RFG-1, RFG-2 or RFG-8 filing.



The filing process begins when the Board issues its annual revised filing guidelines in late spring. The guidelines are designed to ensure that the rate filings provide sufficient information for the Board to determine if the requested rates are just and reasonable. The Board review begins as soon as a rate filing is received. Staff start the process of analysing the information contained in the filing. Rate filings contain a significant amount of financial data and staff ensure that the information filed is correct, complete and in compliance with the guidelines.

There is a lot of variation in the size of the rate filings based on the expected premiums or the number of vehicles covered. Some filings might cover a few dozen vehicles and others might involve thousands. Larger and more complex rate filings are referred to the Board’s consulting actuaries for in-depth review and analysis of actuarial standards, principles and assumptions. Smaller filings are reviewed in-house and are reviewed primarily for accuracy and reasonableness.

The file review process often results in discussions with the companies that result in adjustments and changes to the filings. This is because, as stated above, rate filings contain a lot of information. Filings can contain mathematical errors, unreasonable assumptions or errors based on misunderstandings related to the filing guidelines. Once the filing is considered correct and complete it is submitted to the Board for consideration.

Once approved the insurance company will be notified.



Although all rate filings are subject to review and are ultimately approved by the Board, appearing before that Board at a hearing is only required in specific circumstances. The Insurance Act specifies that if an insurer is seeking an increase of more than 3% over currently approved rates then it must appear before the Board. Even if a rate filing is not in excess of the 3% threshold, the Board can still require an insurer to appear before the Board in order to better investigate the proposed rates.

Once a decision to hold a hearing has been made, either through the automatic triggering process (as described above) or as a result of a decision of the Board, a notice of hearing is issued by the Board providing the details of the upcoming hearing. The notice of hearing starts the clock on the formal hearing process.

The hearing process used by the Board is designed to allow interested parties an opportunity to review the rate applications subject to a hearing, to ask questions of the company making the rate filing and to make representations to the Board with respect to the rate filing.

Once all of the evidence has been received by the Board from the various parties, the Board will deliberate and render a decision on each rate application that has been subject to a hearing.

Decisions of the Board are posted on this website. For more detailed information on hearing processes please click here.



Yes, however, there are guidelines to follow that are outlined in the filing guidelines under section 4.k.



Insurance licensing is handled by the Financial and Consumer Services Commission of New Brunswick (FCNB) – Insurance Division. For more detailed information please contact them directly. The following are information links provided on their website:

Licence Types, Requirements, and Fees

http://www.fcnb.ca/insurance-Licence-types.html

Licence Renewal Forms

http://www.fcnb.ca/Licence-renewal.html

See who is licenced in NB

http://www.fcnb.ca/search-the-insurance-licence-database.html

Self-Serve Online Insurance Licensing System:

https://portal.fcnb.ca/logon

FCNB Contact Information

http://www.fcnb.ca/fcnb-contact.html