To garner NDP support for the 2013 budget, the minority Ontario Liberals offered up a 15 percent reduction in auto insurance for the province’s drivers, long thought to be overpaying for their annual car insurance premiums. The budget deadline for the reduction was August of 2015. The government fell short of the seven percent mark, reporting an average decrease of about 6.96 percent at the end of September 2015.
In January, Premier Kathleen Wynne insisted that the goal was always a lofty target and was not expecting to hit the full reduction in that time frame.
The NDP is, however, calling foul on the stalling, saying that there has never been previous mention that August 2015 was not a hard deadline. Critics from opposition parties suggest that Liberals knew the target was unobtainable and the commitment was made only to earn the NDP’s support to prop up the minority government. They feel now there was no intent of follow-through by the provincial government.
Some companies have reduced rates by the target amount. Wynne described the number of companies as “many,” however quarterly statistics show that only a few have achieved the reduction.
The Liberals have introduced legislation to further reduce car insurance premiums by lowering costs for insurance companies, which can then pass the savings along in the form of reduced rates to its customers. The Liberals will not forecast a date when these legislative changes might achieve the 15 percent reduction.
The Future of Ontario Car Insurance Rates
The Financial Services Commission of Canada (FSCO) commented that the additional 0.15 percent decrease in the fourth quarter of 2015 is a promising indicator for the general direction of car insurance premiums. Calling Ontario’s insurance marketplace “very competitive,” the FSCO pointed out that rates for the same coverage varies between insurers, so the consumer’s best bet is always shopping around and comparing rates to find the best fit.
The FSCO also noted that not every driver will see rates going down, that the overall reductions are averages. This may indicate high-risk drivers are bearing more of the premium load.