The Ontario Government handed down its first budget under the reigns of the Progressive Conservative Party on Thursday, and with it a suite of proposals aimed at “fixing” auto insurance rates in the province.
The Financial Services Regulatory Authority of Ontario (FSRA), has a “multi-year strategy” to increase competition, reduce fraud, and lower insurance rates.
- Allowing drivers to use electronic proof of insurance, instead of the current pink slip system
- Allowing pay-as-you-go plans
- Eliminating postal code-specific insurance rates
- Allowing companies to assess rates using drivers’ credit scores
- Allowing insurance companies to offer cheaper rates for drivers’ who commit to using specific auto repair or health care services.
The Government also says it plans to “reduce regulations on insurance rates” and work with FSRA to reduce the amount of court-related activities needed to finalize claims. What this means in real terms is as yet unclear, but it seems the PCs and FSRA are hoping to restructure the way at-fault claims are litigated and decided.
An online claims process has been posited, and the PCs and FSRA say they will use that process and enhanced data analysis to detect and reduce fraudulent claims.
As repair costs for modern vehicles and crash rates due to distracted driving increase, it remains to be seen whether these changes are enough to impact insurance rates in Ontario.
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