Here at RateSupermaket.ca, we keep you in the loop of different ways to save, whether it be on your mortgage, through investments, or on your car insurance. The Financial Services Commission of Ontario (FSCO) has reported that Ontario car insurance rates have increased by 1.11 per cent on average.
Car insurance rates fluctuate based on a number of different factors. However, before an insurance company can change rates, it must first be approved by the Financial Services Commission of Ontario (a regulatory agency of the Ministry of Finance).
FSCO publishes approved rate changes quarterly, and the latest results are in:
In the second quarter of 2018, approved rates from auto insurance companies increased by 1.11 per cent on average – not a huge increase, but notable.
The range of approved rates seemed to be significant, with some companies lowering their rates by about 0.69 per cent, and another inflating its rates by 8.15 per cent on average.
“Consumers are urged to shop around for auto insurance,” FSCO said in its quarterly statement. “Rates for the same coverage vary based on each insurer’s claims experience and the insurer’s rating system.”
In comparison, the first quarter of 2018 saw an average increase of 2.23 per cent.
Why are car insurance rates changing?
In its statement, FSCO noted two factors that could be attributed to rising rates in Ontario.
First, insurance companies are reporting an increase in claims costs related to property damage. This is likely due to increases in vehicle repairs costs as cars become more technologically advanced.
Second, the growing number of distracted driving incidents may be driving up the overall cost of direct compensation and collision claims insurance companies need to process.
Essentially, insurance companies may be paying out more in claims and need to compensate by raising rates.
One month post-election; Uncertainty remains in the future of car insurance rates
One month following the Ontario provincial elections, it’s still unclear how rates will be affected by the change in leadership.
Prior to Doug Ford becoming premier last month, and even before he became the party leader back in March, the PC party indicated that if it was in power, it would end the practice of factoring where you live into your auto insurance rates.
During the elections, the party’s published agenda mentioned items like scrapping the carbon tax and lowering hydro fees, but did not specifically address the subject of auto insurance in the province.
Statistically, Ontario drivers pay the most for auto coverage than drivers in any other part of the country. This could be attributed to the fact that drivers in urban areas pay more for coverage than drivers in rural areas because insurers receive more claims in areas that are heavily populated and simply have more people on the road. However, the party said it would work on adjusting rates for those in Ontario’s biggest cities while still protecting the premiums of those who live in less populated areas of the province.
How do I know if my car insurance rate changed?
With rates changing so often, it can be hard to tell if your company is still giving you the best rate. The same rate you were offered last year may not apply when you choose to renew.
Thankfully, RateSupermarket.ca allows you to easily compare auto insurance quotes with their online comparison tool. Within minutes, you can see who offers the best coverage for the lowest price. It’s fast, easy and free.
Don’t be afraid to switch insurers. Shopping around on RateSupermarket.ca could save you hundreds on your car insurance.
This post is updated quarterly to reflect latest FSCO results.