Ontario auto insurance rates drop 4% after budget deal
Rates have dropped an average of about 4 per cent
By Robert Benzie, Queen’s Park Bureau Chief
Auto insurance rates have dropped an average of about 4 per cent as part of the minority Liberals’ budget deal with the NDP to reduce them by 15 per cent, sources say.
The Financial Services Commission of Ontario, the provincial government’s insurance regulator, is expected to formally announce that Wednesday.
That means the Liberals would be halfway to Finance Minister Charles Sousa’s promise of an 8 per cent rate cut by August with an eye toward fulfilling the New Democrats’ 15 per cent demand next year.
Sousa has said the changes have to be phased in to allow time to tackle fraud and find other savings to make the auto insurance system more efficient.
But NDP MPP Jagmeet Singh (Bramalea-Gore-Malton), who spearheaded the policy that was a cornerstone of the agreement to win his party’s support for Sousa’s budget last spring, said “drivers are tired of waiting.”
“Eight months after the budget promised a 15 per cent reduction in auto insurance, some drivers are still seeing hikes despite healthy industry profits,” Singh told reporters Tuesday at Queen’s Park.
“They’re nowhere near 15 per cent and they’re nowhere near the 8 per cent that they promised in one year. It’s unacceptable,” he said.
“For them to think they can achieve this goal magically at the end of the year is, in my opinion, not being forthright with the people of Ontario.”
The promised rate cut, which would be about $225 a year for the average motorist, was critical to securing NDP backing for the Liberal budget, which kept Premier Kathleen Wynne’s government in power by preventing an election last year.
Ontario motorists pay the highest auto insurance premiums in Canada. One reason for that is fraud has been rampant in parts of the Greater Toronto Area.
Last June, new anti-fraud measures took effect and the government has been trying to crack down by licensing health clinics that invoice insurance companies.
The Liberals are also looking at provincial oversight of the towing industry and collision repair shops and forcing insurers to offer discounts to motorists with safe driving records.
Susie Heath, Sousa’s press secretary, said the government was “looking forward to the results of this progress” Wednesday.
“We’ve been taking action to reduce auto insurance rates for Ontario consumers. We were clear all along that our strategy would reduce auto insurance rates by 15 per cent on average over the next two years and would have an 8 per cent reduction within the first year.”