The Health and Moral Hazards of No-Fault Insurance

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The siren call of pure no-fault automobile insurance echoes once more in Canada. This time its seductive strains are heard in British Columbia. The imminent introduction of no-fault insurance raises familiar questions. Is no-fault automobile insurance better than a tort liability system in containing premium costs, producing fairer awards and reducing injuries? The quick answer, based on empirical evidence of no-fault insurance and economic theory, is that no-fault does not deliver the benefits promised; it simply redistributes the costs which may actually increase.

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