Ontario Car Insurance Rates are on the Rise in 2018
Although it has some of the lowest numbers in terms of accidents and auto-related deaths and injuries in the country, Ontario has some of the most expensive car insurance premiums in the country. Ontario’s financial regulator has kicked off 2018 by approving higher insurance premiums for drivers. The approvals mean that car insurers in Canada can raise how much they charge for new and existing customers.
17 Ontario insurers had their applications for premium hikes approved in the last quarter of 2017 by the Financial Services Commission of Ontario (FSCO), which regulates car insurance rates in the province. Premiums increased by an average of 1.03% and will be applied by all insurers based on premium volume. Several insurers put these changes in place prior to the end of 2017, but many changes will not come into effect until spring of 2018.
In 2013, the Liberal government promised to cut car insurance rates by 15% before 2015. However, the Ontario Ministry of Finance announced that the rate changes of the last quarter of 2017 only brought the rate down by 5.5% — three years after the Liberals’ deadline.
Keep in mind that while rates might be rising overall, that doesn’t mean that your rates will. Even if they do, other insurers may be lowering their premiums, meaning it’s a good time to contact your broker to compare rates and find something cheaper.
Why do car insurance rates go up and down?
Car insurance rates often change, and it usually comes down to the insurance company’s claims costs. When the cost of claims go up (or down), typically premiums will follow. There are other factors that can contribute as well, like the introduction of new discounts (e.g. winter tire discount) or when coverages or options change, to name a few.
Something to note, Ontario car insurance companies cannot increase (or decrease) their rates on a whenever they see fit. The FSCO must approve changes to car insurance rates and release approved rate changes every three months.
“Consumers are urged to shop around for auto insurance,” says FSCO every quarter in its report. “Ontario has a very competitive marketplace.”
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