Toronto, ON (Jan. 21, 2016) – This notice provides an overview of the private passenger automobile insurance rate changes approved or ordered by the Financial Services Commission of Ontario (FSCO) for filings reviewed in the fourth quarter of 2015. The number of filings reviewed by FSCO and the overall average rate change for the Ontario market may vary from quarter to quarter, based on updated information about claims costs, market conditions and other financial factors and the resulting impact that these factors have on the adequacy of an insurance company’s current rates.
Average Rate Changes
FSCO approved 26 private passenger automobile insurance rate filings during the fourth quarter of 2015. A total of 21 insurers submitted the filings.
These 21 insurers represent 51.23% of the market based on premium volume. Approved rates decreased on average by 0.15% when applied across the total market. Rate changes approved for each insurer this quarter and effective dates of the rate changes are shown in Table 1 (follow the link below).
This compares to a decrease of 0.50% on average for the third quarter of 2015.
Regulatory changes have been made to require insurers to offer a winter tire discount to private passenger automobile policyholders for contracts issued or renewed on or after January 1, 2016. Filings for winter tire discounts were approved in the third and fourth quarters of 2015.
Further regulatory changes were made to reduce costs and fraud in the auto insurance system. These changes, effective June 1, 2016, include reductions to the compulsory standard Accident Benefits coverage, with the continued ability for consumers to buy enhanced optional benefits. Changes also included a prohibition on rating for certain minor accidents that occur on or after June 1, 2016. Insurers were required to submit automobile insurance reform filings to FSCO by October 30, 2015 to reflect these changes. Four auto insurance reform filings were approved in the fourth quarter.
For more details, refer to Auto Insurance Rates for the Fourth Quarter of 2015 on the FSCO website. Information includes:
- How an individual’s rates may differ;
- FSCO’s rate approval process;
- List of rate filings approved or ordered;
- Detail of claims costs by coverage for accidents in 2014.
About the Financial Services Commission of Ontario
FSCO was established under the Financial Services Commission of Ontario Act, 1997 (FSCO Act) with a legislative mandate set out in the FSCO Act.
FSCO’s legislative mandate is to provide regulatory services that protect the public interest and enhance public confidence in the sectors it regulates.
FSCO regulates the insurance sector; pension plans; loan and trust companies; credit unions and caisses populaires; the mortgage brokering sector; co-operative corporations in Ontario; and service providers who invoice auto insurers for statutory accident benefits claims. FSCO is accountable to the Minister of Finance.
In order to support FSCO’s legislative mandate, the FSCO Act sets out a three-part structure for FSCO, which includes the Commission; the Superintendent of Financial Services and Staff; and the Financial Services Tribunal (Tribunal).