Population demographics may soon play a major role in the way personal injury claims — particularly accident benefits claims — are handled in Canada. The real question is, what can be done proactively to minimize the impact?
Boomers drive on ….
Canada’s baby boom is larger than that of most other G8 countries, and next year the first baby boomers will reach the age of 70. In fact, more than one quarter of Canada’s population (27%) is comprised of baby boomers, and in the last 10 years the number of Canadians aged 65 and above increased by 15 per cent.
Economists are concerned about how this is going to impact Canada’s workforce. It is clear that insurance companies need to consider how this is going to impact their personal injury claims. Unlike previous generations, most baby boomers maintain two vehicle households, and do not plan to give up their licenses any time in the near future.
Results of a recent Liberty Mutual study in the United States can easily be extrapolated to Canada. Despite retirement and declining physical abilities, the study found that senior drivers still drive regularly with 41% driving every day and 38% driving several times per week. Seniors responded that they plan to continue their driving habits despite indicating that:
- 78% feel they have declining physical abilities
- 16% said they tire easily when driving
- 13% report they have difficulty with hearing and/or vision
- 9% indicate they often get lost or feel confused while driving
We can only anticipate these numbers continuing to go up as more and more baby boomers reach retirement age. Based on psychological studies of this generation it is clear that they will not give up driving as quickly as their parents because of a more determined and independent mindset coupled with increased generational wealth.
Known Impacts for Canadian P&C insurers…
Leaving aside the argument/assumption that older drivers present an increased risk on the roadways, we can agree that, all else being equal, the vast majority of people over the age of 70 are not as physically robust as they were in their younger years.
The human body starts to decline after the age of 40 and muscle tone starts to decrease at a more advanced pace. Other common physical ailments start to present themselves such as osteoporosis, osteoarthritis, back pain, type II diabetes, heart conditions, etc. These conditions clearly present more of a risk in the event of physical trauma, such as a car accident. We can make a confident assumption that the injuries sustained from the accidents that do occur will be more severe for elderly drivers and vehicle occupants.
But what are the known unknowns?
Distracted driving has now become one of the leading causes of vehicular accidents, and has resulted in an increased incidence of rear end collisions. Regardless of fault, these often result in injury.
Current Health Claims for Auto Insurance (HCAI) data reveal that at least 70% of the claimants receiving treatment are being diagnosed with strains and sprains which fall under the Minor Injury Guideline (MIG) and are often the result of this type of accident. HCAI data seem to indicate that at least 23% of these claims will progress and move on to non-MIG treatment.
The real question that we want to explore is what these numbers will look like when a full 27% of the population is older than age 65 and still driving. For example:
- Will 70% of the soft tissue injuries remain in the MIG?
- How would the same accident that left a 40 year old healthy female with neck strain and a bruised collar bone impact a 73 year old woman with mild osteoporosis and a bad back?
These are important questions that need to be examined from both the insurance side and the practitioner’s side. Would the injury even remain in the MIG at all?
We know that older human bodies do not heal as quickly, especially if complicating age related factors such as diabetes are introduced. How will this affect those 23% of treatment plans that become non-MIG claims?
What’s the last question?
There is no question that the aging of Canada’s population will impact personal injury claims and how they are managed. The question is how much and what can be done to proactively minimize the impact?
Editor’s note: Sean Cassidy is Vice President, Sales and Marketing for Benchmark Independent Medical Examinations Inc. Benchmark provides professional staff and state-of-the-art customized software to provide a seamless, straightforward, and effective IME experience.