Insurance brokers across Ontario have been hearing from customers who are unhappy or concerned that their car insurance rates are rising. We understand your concerns. We are drivers too. We are eager to help you keep your car insurance rates as low as possible.
To help you understand why Ontario’s auto insurance costs are increasing, how the auto insurance industry is regulated and – most importantly – what you can do to keep your car insurance costs as low as possible, we have prepared this blog with many helpful tips to help keep your car insurance rates as low as possible.
In Ontario, automobile insurance is regulated by the Financial Services Commission of Ontario (FSCO), a regulatory agency of the Ministry of Finance. FSCO is accountable to the Minister of Finance. FSCO was established in 1997 under the Financial Services Commission of Ontario Act. On its website, FSCO states that it regulates the insurance sector; pension plans; loan and trust companies; credit unions; the province’s mortgage brokering sector; co-operative corporations in Ontario; and service providers that invoice car insurers for accident benefits claims set out in the statute.
In Ontario, motorists are required by law to have car insurance. If you do not have auto insurance, the owner of a vehicle, lessees, and drivers without valid auto insurance can be fined from $5,000 to $50,000. If you are found driving without valid car insurance, your driver's licence may be suspended and your vehicle impounded.
If a driver is convicted of driving without car insurance, the insurance company may charge a higher premium or refuse to sell the driver insurance altogether. Also, if you are injured in an accident while driving or while you are in a vehicle that is not insured, you may not be entitled to receive income replacement and/or non-earner benefits. You also may not be allowed to sue an at-fault driver for compensation if you sustained injuries in the accident. Further, if you are found to be at fault for an accident causing injury or death, you may be responsible for medical costs and other losses. This is serious stuff.
The Financial Services Commission of Ontario released its fourth quarter report for 2018 and this showed an approved rate increase of 3.35 per cent on average. The operative word is average. Some drivers many see their rates increase very little – below the average - while others will see increases far above the average.
FSCO reports on approved rate changes four times a year. Most rate increases are related to the costs of repairs on cars and looking after those who have suffered harm in accidents or other car mishaps.
In November 2018 the Ontario government said it would review the auto insurance system and work to lower auto insurance rates. In its budget the government noted that it would be reviewing some elements of auto insurance and it will look at practices in other jurisdictions. It also said it would consult with insurance companies, the public and others to get their views on how to improve the current situation.
Finance Minister Vic Fedeli has stated that the government will work to cut red tape and modernize the auto insurance sector with electronic communication and issuance of electronic proof-of-insurance cards.
However, the director of consumer and industry relations for the Insurance Bureau of Canada, Peter Karageorgos, has said that addressing fraud in the system, and tackling auto-repair and health-care costs, are issues that need to be looked at.
In 2017 B.C.’s average annual auto premiums were $1,680. Ontario had the second highest auto insurance prices with average annual auto premiums at $1,445. Quebec had the lowest rates at $661 per year in premiums. Prince Edward Island had $796 on average in 2017.
Here is the list by province:
Source: Canadian Underwriter.
Insurance companies take into account several factors when determining your premium. Driving experience, and the type, make, model and age of your vehicle, are among the factors. Other factors include your driving record, age of the driver, who else will be driving the vehicle, and where you live (rural areas generally have fewer collisions, cities with high-density populations have more collisions and theft, and will result in a higher premium). If you have any claims, convictions or license suspensions on your record or have previously been cancelled by an insurance company for a reason such as non-payment of premium, this can impact on your rates. Another factor is if you use your car for business. This is likely to mean you will pay more because you are probably driving more and perhaps in busier areas. Essentially, insurance companies are determining the likelihood that your car will be involved in a collision, the likelihood of theft, and how expensive it will be to repair or replace. When the risk is lower, the premium is lower.
The cost to pay claims is the largest determinant of how auto insurance rates are set. Some of the factors included in claims’ costs are the amount of awards of injury claims, legal costs, and auto repair costs (parts and labour).
Some tips to cut auto insurance costs include shopping for the best prices and coverages, getting all the discounts you deserve, increasing your deductible, and keeping your driving record clean.
Our broker team can do the shopping for you! We will ask you some questions and shop more than two dozen insurance companies for the best car insurance coverage at a competitive price. We will compare coverages and prices at dozens of companies to get you what you need. One call is all it takes to get many quotes, professional advice and service at Morison Insurance.
These ‘extras’ can save you a considerable amount of money. Here are many of the discounts we offer:
Before you buy a car, consider the insurance costs to insure it. In short, some cars cost more to insure than other. Contact our broker team and we will give you all the details.
The deductible is the portion of a policy that you pay before the insurance company does. A higher deductible can lower your insurance costs.
Making insurance claims, and having driving tickets can negatively impact your car insurance rates. Serious infractions such as driving under the influence (DUIs) can lead to price increases or cancellation of your insurance. Conversely a clean driving record can lower your auto insurance costs. Some companies offer accident and ticket forgiveness which means if you maintain a record of no accidents or tickets for a certain period you won’t see a car insurance rate increase.
Give some thought to dropping collision and/or comprehensive coverages on older cars. This can help you to save.
New drivers will qualify for lower rates when they have completed an accredited driving course.
If you drive a car that is less likely to be stolen this will impact your rates in a positive way. A 2018 news article, citing a report by the Insurance Bureau of Canada, reported that auto theft is up 6% across Canada. Ontario’s rate was 15%. At the top of the list of most stolen vehicles were Ford F-series pickup trucks and high-end SUVs.
If you are now driving your car less than you used, this will help to drive down your car insurance costs. Moving to another city or neighborhood can also mean lower insurance rates. Also, if you used your car for work and no long do so, this can help to lower your insurance costs.
If you have multiple policies with one insurance company this will help to lower your rates. Bringing your home and car policies and/or additional policies together helps you to save. It can also make it easier to manage your insurance with aligned renewal dates.
If you are able to exclude a non-standard driver from your policy - meaning they don’t drive your vehicle – this can help to lower your rates. Ask our brokers for more details. We are here to help.
In some cases, full pay is better than paying in installments.
Our team is all over the effort to get you the insurance you need at the best price possible. We want to be clear though that the lowest-priced insurance is not always the best. The right coverage matters.
Be sure that you are getting the coverage you need. Be cautious. Ensure you have insurance with the right protection. Know what you are insured for. Remember the adage of ‘You Get What You Pay For’. It generally holds true. Also remember that coverage is protection and if you decide to go with minimal coverage, you get minimal protection. Our insurance brokers will be happy to discuss the details of your insurance needs. We want you to save money AND be properly protected.
Some companies appeal to would-be customers by saying they will get your insurance super-fast. Our broker team is definitely committed to getting you insurance quickly, but we are also very committed to getting you the proper insurance protection. If it takes a wee bit longer to do it right, we believe this is time very well spent. Have you seen the TV commercial where a man has his car hit while it’s parked in an underground garage? Yes, he got his car insurance quickly, says the narrator, but he didn’t get the coverage he needs to be properly protected. Remember, it’s too late to get the proper insurance coverage AFTER an event happens – in this case physical damage to this man’s car.
We know car insurance can be complicated. There can be lots of things to think about and many unfamiliar terms to understand. Liability. At-Fault Accidents. Comprehensive Coverage. All-Perils Coverage. Vehicle Depreciation Waiver. These are just a few of the terms that insurance brokers use every day. We don’t expect everyone to be as familiar with them as we are.
Our team of broker professionals is pleased to explain these terms to you and to discuss your coverage needs. Contact us for all of your insurance needs. We provide vehicle, home, business, recreational, life insurance and more. If you have it, we can insure it.
Morison Insurance’s brokers are licensed to provide many kinds of insurance in Ontario, including car insurance. Our brokers are Registered Insurance Brokers. We will get you the insurance you need, provide you with several competitive car insurance quotes AND we will get you all of the insurance discounts you qualify for.
Our brokers represent many different insurance companies from across Canada, and we will find you the auto insurance policy to protect you and at a competitive price. We will ‘shop’ for the best coverage to meet your specific insurance needs. There are insurance agents and direct sellers in Ontario who sell car insurance, but these organizations do not represent the wide variety of insurance companies that we do as brokers. Typically they represent one – yes, one – company. When we get you an insurance quote, our team reaches out to many insurance companies across Canada that compete for your business. This often means a better price for you.
Further with our team you will receive great service to meet all of your insurance needs. We are here whenever you need us – to get answers to your questions, change your insurance policy, report a claim, insure you home, another vehicle, business, cottage, recreational vehicle and much more. We provide outstanding service. Every Morison Insurance customer has a designated broker who looks after your account personally. We are not a call centre. We are a full-service brokerage where the focus of on our customers. We can be reached by phone, email or text. We have 24-hour claims service. We are here for you.
When it comes to insurance, like most things, price is very important. We understand this because we, like you, want to save money whenever possible. We will save you money whenever we can. We will make sure you get any discounts you are entitled to. There are many auto and home insurance discounts.
Aside from price, however, there are other important things to think about when it comes to insurance coverage. What are your deductibles, what are the limits on your coverages and do you have all of the optional coverages you want and need. We are pleased to discuss all of these with you.
Morison Insurance is pleased to be the recipient of numerous awards, including being named #1 broker in Ontario by the Insurance Brokers Association of Ontario, an association that represents thousands of brokers across the province. We have also won numerous community awards annually in the communities we serve. When you are looking for insurance, choose the best, choose Morison Insurance.
This blog is provided for information only and is not a substitute for professional advice. Please call our Morison Insurance brokers at 1-800-463-8074 for more information.