IBC sets record straight about auto insurance prices in Ontario

Toronto, ON (May 30, 2013) – The New Democratic Party’s deliberate attempts to mislead consumers serves only to deflect attention from the real issue, which is reforming Ontario’s auto insurance system.

“It is too simplistic to raise a couple of examples of rate increases without knowing the entire story,” says Ralph Palumbo, VP of IBC for Ontario. “We categorically reject any suggestion that rate increases represent an attempt to raise premiums in anticipation of proposed rate decreases as part of the Liberal government’s sensible cost reduction strategy. The reality is that any current rate increase is based on rate filings made by insurers and approved by the provincial regulator well before the NDP demanded an arbitrary rate cut. To suggest otherwise is irresponsible.”

Auto insurance rates are approved quarterly by the Financial Services Commission of Ontario. Rates approved during the first quarter of 2013 declined on average by 0.03%, based on the entire market.

“An individual’s rates may change for a number of reasons: if they have moved, bought a new car or had a change in driving record”, said Mr. Palumbo. “This is why we ask insurance representatives to work closely with consumers to help them better understand their policy, as well as any change in rates.”

To help lower rates, the 2013 Ontario budget proposes a strategy that targets auto insurance fraud and other high costs in the system.

“The government has signaled its commitment to reforming auto insurance.” says Mr. Palumbo. “If the NDP is truly serious about lowering rates, they should work on implementing these reforms, instead of maligning the 63,000 men and women who work hard to provide Ontarians with peace of mind.”

IBC continues to work with government, consumers, and all other stakeholders to develop workable solutions to the problems plaguing the current auto insurance product.

About Insurance Bureau of Canada

Insurance Bureau of Canada is the national industry association representing Canada’s private home, car and business insurers. Its member companies represent 90% of the property and casualty (P&C) insurance market in Canada. The P&C insurance industry employs over 115,000 Canadians, pays more than $7 billion in taxes to the federal, provincial and municipal governments, and has a total premium base of $44 billion.

To view media releases and information, visit the media section of IBC’s website at www.ibc.ca and for IBC on Twitter follow @insurancebureau.

SOURCE: Insurance Bureau of Canada