Ontario auto insurance rates for first quarter of 2005

Ontario private-passenger auto insurance rates
decreased further during the first quarter of
2005 (January 1, 2005 to March 31, 2005).
The rate applications approved during the first
quarter of 2005 indicate an average decrease of
1.12%, when weighted by 2003 market share
for those insurers making rate changes. The
weighted average rate change for the year 2004
was 10.6% for the entire market.

The average price of auto insurance in Ontario
at the end of the first quarter of 2005 was 7.46%
lower when compared with the end of the first
quarter a year earlier. This calculation is based
on the renewal effective dates of the rate
changes. This compares to the 7.84% average
increase reported in the first quarter of 2004
over the first quarter of 2003, and the 19.09%
increase reported in the first quarter of 2003
over the first quarter of 2002. The rate
decreases approved in the first quarter of 2005
become effective in the second quarter of 2005
or later, for renewal business, and will further
reduce the average price of auto insurance at
that time.

The approved rate change shown for each
insurance company is the average for that
particular company. The impact of a rate
change on an individual consumer will vary
depending on where the consumer lives, the
type of car he or she is driving, and other risk
characteristics.

The rate changes posted reflect cost-saving
measures arising from recent reforms to the
automobile insurance system, which are being
passed on to consumers in the form of lower
rates.

FSCO will continue to ensure that insurance
companies’ rate changes are reasonable and
justified, and that the rates insurers charge are
balanced with their ability to meet their future
claims costs.

(1) Rate changes with no overall impact.
(2) Rating rule change
only.
(3) Introduction of a new rate program.

For more information, visit the Financial Services Commission of Ontario Web site at www.fsco.gov.on.ca