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Will the Ontario Liberals Deliver on the 'Promised' Car Insurance Discount?

July 30, 2014
5 mins
Professional couple in grey vehicle

Thousands of Ontario car drivers are now enjoying discounts on their auto insurance policies thanks in part to the Ontario Liberal Party. As you recall, the Liberals initiated measures to curb insurance fraud last year and introduced Bill 171 and Bill 189 in March 2014 before an election call was made. In addition to a 15% discount on insurance by 2015, Ontario drivers would benefit from clarity and tightening in towing costs and better management in settling disputes.

So far the Liberals report that insurance rates have dropped by an average of 5.44%, although that's obviously not the case across the board or throughout the province. The Liberal government also notes that more than a dozen insurance firms have reduced rates by 10% or more since the policy recommendations last year.

So the big question remains: Will the Liberals still be able to deliver the 15% discount, and help Ontario drivers save an average of $225 annually on their car insurance, by August 2015?

In a recent Toronto Star report, Liberal Finance Minister Charles Sousa said because the original legislation was delayed due to opposition from the Conservative and New Democratic Party, the 8% rate discount by August 2014 will not be achieved but the 15% overall reduction is on target for August 2015.

Because the Liberals now have a majority government, passage of a new Bill 15, which combines elements of the previous two bills, should proceed smoothly and help hit the discount target for next year.

Of course, the opposition parties still point out that Ontario residents pay the highest insurance rates in Canada and that costs continue to increase for many drivers in the province despite the action from the Liberals.

The Insurance Bureau of Canada is more optimistic, however. In addition to pointing out that reducing fraud and insurance costs is still within reach, Bill 15 would help control the cost of vehicle storage after a collision, prevent settlement dispute backlogs and drive down unnecessary claim costs for Ontario's nine million drivers.

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