Toronto, ON (Jan. 16, 2014) – For the 4th consecutive quarter, and the second year in a row, private passenger automobile insurance rates, set out in filings that are approved by Financial Services Commission of Ontario (FSCO), dropped on average.
“The Government’s approach to reforms appears to be working and auto insurance rates are continuing to fall. That’s good news for Ontario’s 9 million drivers,” said Ralph Palumbo, Vice-President, Ontario, Insurance Bureau of Canada.
“Insurance companies are cutting rates and offering discounts to good, responsible drivers. That’s the direction we want rates to go,” said Palumbo. “The industry supports the Government’s crack down on fraud, and its hard look into other cost reduction initiatives, including provincial oversight of the towing industry and collision repair shops. Some insurers are also looking at adopting new technologies like usage-based insurance, which monitors the way you drive, linking it to the price you pay.”
Today’s notice from FSCO is an overview of the private passenger automobile insurance rate filings that are set and approved by FSCO each quarter. Not all companies were ordered by FSCO to file for new rates. This report reflects just 32 companies that filed. Of the approved filings, the average for these specific companies declined more than 6% with the largest decline being 14%.
The insurance industry has achieved these reductions despite the fact that claims costs in Ontario continue to be much higher than in other provinces:
- Average insurance payout for a no-fault injury claim in Ontario is (2012) $26,863. In Alberta, it is $3,628 and in Atlantic Canada, it is $7,713.
- Average insurance payout for a non-minor injury claim where there is an at-fault driver in Ontario is $157,133. In Alberta it is $50,964 and in Atlantic Canada, it is $49,454.
According to Palumbo, this illustrates that more needs to be done. “Further momentum will only happen when all of us – the insurance industry, government, service providers in the car accident business and consumers – work together to do what is necessary to drive down claim costs. Costs are still too high but we’re committed to doing whatever it takes to continue to find a better way and to help build an auto insurance system that will work for decades to come. The affordability of insurance is fundamental to the health and success of Ontarians.”
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 118,600 Canadians, pays more than $7 billion in taxes to the federal, provincial and municipal governments, and has a total premium base of $46 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