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The Financial Services Commission of Ontario has released its quarterly rate update, with a raft of rate increases approved in the province. Auto insurance rates will be going up on average 2.70 percent in the sixth-straight quarter of rate increases. The trend started with a spike in Quarter 4 of 2017 on average 2.70 percent, followed by an increase in Q1 of 2018 of 2.23 percent, and 1.11 percent in Q2. Q3 saw rates climb 2.06 percent and in Q4 of 2018, 3.35 percent.

What’s causing the rise?

FSCO has listed two evolving causes for the increasing rates of auto insurance in Ontario:

  1. Increased claims costs related to auto insurance fraud and costly vehicle repair
  2. Collisions caused by distracted driving

The trend is worrying and is not lost on the Canadian government, as the Ontario Budget 2019 (announced on Aril 11th) stated a promising plan that will bring respite to drivers in Ontario.

It includes:

  • Backing Bill 42, which disallows postal code as a factor in determining your premiums.
  • Reducing regulation around insurance rates.
  • Allowing pay-as-you-go insurance premiums.
  • Creating a framework that will allow technological product innovations.
  • How rates get approved

Auto insurance companies apply for a rate increase when they are paying out more in claims and need to compensate by raising interest rates. The interest their customers pay, depends highly on their past claims experience, rating system, and the rates they are allowed to implement by FSCO.

They present their actuarial data and supporting documentation to show that the rate changes are reasonable.

Shop around

Consumers are strongly advised to shop around and compare insurance quotes, to get the best price for the required coverage. With frequently changing rates, you might not be offered the same rate at the time of renewal that was offered last year.


The RATESDOTCA editorial team are experienced writers focused on sharing stories and bringing you the latest news in insurance and personal finance. Our goal is to provide Canadians with the information and resources they need to make better insurance and financial decisions.

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