Ontario reforming auto insurance to make it more affordable

Dec 5 2017, 5:24 pm

Changes are coming to Ontario’s auto insurance plans.

The province announced on Tuesday that it will be slashing rates while addressing fraud in its new Fair Auto Insurance Plan.

The plan is based on recommendations made by David Marshall, Ontario’s advisor on auto insurance, in a report released in April 2017.

In his report, Marshall “urged transformative changes aimed at improving the care received by people hurt in collisions, reducing disputes around diagnosis and treatment — and promoting innovation, competition and other steps to improve consumer protection.”

Minister of Finance Charles Sousa said that previous changes that resulted in lower insurance costs for drivers didn’t go far enough.

“That’s why we commissioned David Marshall to uncover the root of the problem and provide recommendations to improve consumer protection and system efficiency. Based on the findings of his report, we are taking action through the Fair Auto Insurance Plan to help victims, tackle fraud and further reduce premium costs,” he said in a statement.

As per the province, the government’s new plan includes:

  • Implementing standard treatment plans for common collision injuries such as sprains, strains and whiplash to help people receive the treatment they need after an accident, changing the emphasis from cash payouts to ensuring appropriate care for victims
  • Reducing diagnosis and treatment disputes between insurance companies and people injured in collisions by instituting independent examination centres to assess more serious auto collision injuries
  • Cracking down on fraud by launching the province’s first Serious Fraud Office in spring 2018. The office will use an integrated and dedicated approach to combat serious fraud, with a focus on auto insurance fraud, which has been identified as one of the factors contributing to higher premiums
  • Directing the Financial Services Commission of Ontario (FSCO) to review risk factors used by insurers to calculate premiums with the goal of ensuring drivers in certain parts of the province are not subject to unfairly high rates
  • Ensuring that lawyers’ contingency fees are fair, reasonable and more transparent

The province will be establishing a panel to guide the enactment of reforms contained in the Fair Auto Insurance Plan.

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