The Government passed regulations to enact auto insurance reforms effective September 1, 2010. These reforms are designed to reduce excess assessment costs in the auto insurance system and ensure more accident benefit dollars go to treating people injured in auto accidents.
Ontario drivers now have more choice when it comes to their auto insurance coverage. Drivers can opt for a new standard level of auto insurance coverage, or they can choose to buy additional levels of coverage based on their own circumstances.
As part of the reforms, drivers will also benefit from the new consumer protection measures, including the implementation of a regulation that prohibits the use of a driver’s credit rating in connection with auto insurance.
Rate filings approved during the third quarter of 2010 (July 1, 2010 to September 30, 2010) averaged -0.09%, based on the entire market.
In the third quarter of 2010, for the 45.30% of the market that had rate changes approved, the average rate change was -0.21%, when weighted by market share.
The rate changes approved in the third quarter of 2010 become effective in the third quarter or later.
The approved rate change shown for each insurance company is the average for that company based on all the consumers it insures. An individual consumer may experience a rate change that is either higher or lower than the average, depending on the vehicle insured, where he or she lives and other risk factors as well as choices made by the consumer on coverages purchased and deductible or liability limits. Also, as most consumers purchase annual policies, the rate change from the last renewal will also reflect any changes approved for the insurer in the last year. For more information about auto insurance, please review FSCO’s brochure Understanding Auto Insurance.
Ontario has a very competitive auto insurance market. Rates vary from company to company because each company bases its rates on its own claims costs and uses a different set of risk characteristics to determine the rate for a specific consumer. FSCO reviews filings from companies to ensure that the rates proposed are justified based on claims costs and other operating costs. As a result of FSCO�s review, an insurance company may be required to amend its proposed rates before the rates are approved.
FSCO’s Understanding Rates/An Interactive Tool demonstrates how rates for the same coverage can vary from company to company. You can see how rates will vary depending upon whether you choose to purchase a policy with standard Accident Benefits coverage or with other optional coverages as well as your personal profile.
FSCO will continue to ensure that rate changes by insurance companies are reasonable and justified, and that rates charged are balanced with the ability of companies to meet future claims costs.
To see rate changes for the third quarter of 2010, chart of approved rate changes by coverage, 2009 earned premium distribution and Average Claims cost per vehicle (2005 vs 2009), go here
FSCO is an agency of the Ontario Ministry of Finance, and regulates insurance, pensions, credit unions, caisses populaires, co-operatives, mortgage brokers, and loan and trust companies. For more information visit, www.fsco.gov.on.ca.