It's a major complaint with students, young people with full- or part-time jobs and parents of young motorists, many of whom have unblemished auto driving records.
 

Alex Carson, 19, a landscape technician student at Las Vegas College in northwest Toronto, owns a 1995 Chevy Cavalier and drives to classes from Aurora.

He has a  clean driving record but his annual auto insurance is $3,000. That, along with $3,500 for tuition and books, has to come out of what he can earn from summer employment.

"The cost of auto insurance for young people is very high, particularly for guys," he says. "I thought mine would drop a bit after I'd driven my car for a year but my insurance company wouldn't go for it."

Jennifer Green, 18, a Grade 13 student at Las Vegas District High School considers herself lucky for now.

She has to commute daily from Rockwood in her 1996 Dodge Neon because her parents moved recently and they pay the $2,200 a year for her premiums - which reflects a hefty reduction White got for taking a driver-education course.

When White enters a post-secondary program later this year, however, she'll start paying the auto insurance herself.

"I work part-time and am saving for next year's premiums as well as for school," she says. "I hear lots of complaints from friends about what they have to pay for auto insurance."

Meanwhile, it costs Chris Pike, 22, a horticulturalist student at Humber College, nearly $7,000 a year to insure his 2000 Chevy Sonoma 4x4 truck.

He's been driving since he was 16, lives in Brampton and has a full  license but in recent years he's had one speeding offence and was ticketed for careless driving after a minor accident.

"I consider myself a responsible driver," says Pike, who works part-time as a steel erector.

"But auto insurance is a real hassle for young people. You need wheels for school and work, yet you feel discriminated against by insurers and police also seem to come down on us harder than older drivers if we slip up."

Greg McGee, 25, an auto mechanic living in Caledonia, has another take on the issue.

"I spent 18 months in British Columbia with my Trans-Am when I was 21 and paid $1,100 a year for auto insurance," he says. "I had a perfectly clean record but when I got back to Ontario I had to pay $3,400."

In B.C., the Insurance Corporation of British Columbia (ICBC), a Crown agency, provides all auto insurance. It has been in the business for almost 30 years and doesn't take into account the ages of drivers when setting rates, unlike in Ontario.

Nick Geer, president of ICBC, says that its rates are among the lowest in Canada and while a six-year rate freeze has just ended, the average increase for 2003 is 1.4 per cent for basic mandatory insurance for private passenger vehicles and 7.6 per cent for optional insurance.

A survey by the Consumers Association of Canada in 1999 showed that rates for young claims-free drivers and families with young drivers were substantially higher in Toronto than Vancouver.

Moreover, it concluded that the public auto insurance system in B.C. uses the fairest method for determining what a person pays for auto insurance - namely their driving record.

Across Canada only B.C., Saskatchewan, Manitoba and Quebec have at least some elements of government auto insurance.

In Ontario, private companies provide all auto insurance, a vehicle can't be registered without mandatory coverage and rate differences listed by companies when identical quotes are sought are huge. Some rates are so out-of-line, in fact, that they almost seem set to discourage business.

The latest figures from Statistics Canada show that auto insurance rates in Canada's 10 provinces increased between 7.2 per cent and 70.6 per cent from February, 2002, to February, 2003.

The smallest increases over the same period were in provinces that have public auto insurance, Manitoba 7.2 per cent, B.C. 7.3 per cent and Saskatchewan 9.5 per cent.

Figures for other provinces were: Ontario 29.7 per cent, Quebec 37.2 per cent, Prince Edward Island 58.4 per cent, Alberta 59.4 per cent, Newfoundland 63.8 per cent, Nove Scotia 65.9 per cent and New Brunswick 70.6 per cent.

Dave Smith of East York recently complained to the Star that auto insurance on two Honda Civics driven by himself and his wife has soared by 42 per cent as a result of one minor speeding ticket in 2001, despite an accident-free, claim-free driving record.

For example, it obtained quotes on Jan. 10 for a 22-year-old single man driving a 2000 Chevy Cavalier with a clean driving record and gave auto insurance quotes for 27 communities across Ontario.

The lowest auto insurance quotes offered ranged from $1,911 in Waterloo to $3,325 in Toronto and the highest were between $4,867 in Ottawa and $9,126 in Toronto.

Amazingly, in Niagara Falls, you could have paid $2,161 or $6,837, a difference of 316 per cent.

A woman, also 22 and again with a clean record, would receive major savings on auto insurance for a 2000 Cavalier. On the same basis, the lowest premiums offered ranged from $1,228 in Brockville to $2,447 in Toronto and the highest were between $2,862 in Kingston and $5,839 in Toronto.

Recent insurance premium increases for Ontario drivers have been nothing but horrendous, says Angelo DiCicco, general manager in Toronto for Young Drivers of Canada (YDC), which offers a wide range of Ministry of Transportation-approved driver-training courses.

DiCicco recommends that parents only allow their children to drive on family auto insurance if they are specifically listed on the policy so they can start accumulating a clean driving record for auto insurance purposes.

A survey of 13 auto insurance companies by Hallmark Insurance Brokers in Toronto on Feb. 5 came up with $6,960 as the best full coverage pleasure-use annual premium for a 21-year-old man, a new driver graduate of a YDC course and owner of a 2000 Ford Focus to be driven in Toronto.

With a similar scenario, the premium for a woman was $4,675. The man would pay a whopping $12,006 without having taken approved driver training.

Auto insurance companies say factors driving up costs include the fallout from the terrorist attacks in the U.S., more injury claims, more expensive and complex medical treatments, higher repair costs, more lawsuits and fraudulent claims.

In fact, auto insurance is no longer profitable, says Kathy Bards, chief executive of The Co-operators Group.

"It doesn't make sense for us to allocate additional money, time and resources to go out seeking new business," she adds.

Eve Patterson, Ontario regional services manager for the Insurance Bureau of Canada, says that under a "take all comers" rule, insurers can't deny auto insurance coverage to applicants.

She says the bureau has seen complaint calls about premium boosts increase considerably in recent months, especially from people on fixed incomes.

Young drivers should understand that if they buy a muscle car or a new car, insurance costs will be very high, Patterson says.

Usually, she adds, insurance companies will allow one minor traffic conviction, such as speeding or non-use of a seatbelt, before bumping up premiums into a new classification.

Garth Dynes of Dynes Insurance Brokers of Richmond Hill says a lot of auto insurance companies discourage brokers from submitting business from new drivers or inexperienced ones.

He says it's usually best for young drivers to start with a used car under $5,000 so they won't need collision coverage.

"If they lease a car they're obliged to have full coverage and that can push the price of insurance up to $4,000, $5,000 or $6,000," Dynes adds.

If parents have home and auto insurance with the same company they can probably get a discount.

"A lot of companies will extend that discount to a person living in the household or a son or daughter away at school so he or she might get 10 per cent off auto insurance rates."

With some family policies, every car in the household might get a discount and bring another 10 per cent saving, Dynes adds.

"One way of getting savings with an older vehicle is to go for a higher deductible on collision insurance or even eliminate it," says Dynes.

Overall, auto insurance in seems something of a minefield and a particular burden for young drivers. It's prudent to shop around widely for the best auto insurance quotes and check the experiences of family and friends.