Indeed, Brampton and Rural Huron County are completely different, which is why they should be paying different rates. Whether it's due to population density, idiot drivers, people milking the system, money-hungry lawyers, or otherwise, the reasons don't matter. The fact is that rural Huron County residents claim much MUCH less on AB than Brampton residents, so they should pay a MUCH smaller premium to be fair. Population density is not the issue with Brampton, but rather the people driving there. The claims experience in downtown Toronto (more dense than Brampton) is much better than Brampton.
The proposed bill makes a lot of changes without going into specifics. The "order of importance" for rating variables that is mentioned doesn't even make sense. I can't even tell you which rating variable is most significant to an individual's rate, since it completely depends on the individual. For someone living in Brampton, territory is probably the most significant variable; however, for someone living in London, annual kilometers driven might be the most significant. etc. Your rate is calculated by multiplying many factors together, such as the following simplistic examples:
Example #1 with Territory:
Premium = (Base Rate) * (Territory Factor) * (Years Experience Factor) * (Years Claims Free Factor) * (Commute Factor) * (Annual kms Factor) * (Discounts )
Premium = ($1000) * (1.560) * (0.800) * (0.800) * (1.350) * (1.100) * (0.750)
Premium = $1390
Example #2 with Territory:
Premium = (Base Rate) * (Territory Factor) * (Years Experience Factor) * (Years Claims Free Factor) * (Commute Factor) * (Annual kms Factor) * (Discounts )
Premium = ($1000) * (0.650) * (1.500) * (1.400) * (1.000) * (0.750) * (0.800)
Premium = $819
Now what if we removed Territory rating? Something like the following would result:
Example #1 without Territory:
Premium = (Base Rate) * (Territory Factor) * (Years Experience Factor) * (Years Claims Free Factor) * (Commute Factor) * (Annual kms Factor) * (Discounts )
Premium = ($1000) * (1.000) * (0.800) * (0.800) * (1.350) * (1.100) * (0.750)
Premium = $713
Example #2 without Territory:
Premium = (Base Rate) * (Territory Factor) * (Years Experience Factor) * (Years Claims Free Factor) * (Commute Factor) * (Annual kms Factor) * (Discounts )
Premium = ($1000) * (1.000) * (1.500) * (1.400) * (1.000) * (0.750) * (0.800)
Premium = $1386
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