What’s happening with Ontario auto insurance premiums?
On July 5, online insurance quote comparison service Kanetix released the findings of their quarterly year-over-year auto insurance rate study for the second quarter of 2011.
Kanetix found that Ontario auto insurance rates increased 6.4 percent in Q2 2011. The site said rates have been stabilizing since the auto insurance reforms were introduced in the province in September 2010, with Q4 2010 and Q1 2011 indicating a 9.5 percent and 6/7 percent increase respectively. The year-over-year difference in rate increases is dropping, it added.
The Insurance Bureau of Canada (IBC) said that “recent claims that auto insurance rates may be rising dramatically are neither accurate nor supportable.”
IBC said that Ontario’s auto insurance reforms are addressing cost pressures and are working to stabilize the province’s auto insurance system.
IBC added that data from the General Insurance Statistical Agency (GISA) and the Financial Services Commission of Ontario (FSCO) show that auto premiums have been trending at the rate of inflation.
GISA monthly average data shows that premiums increased by 2.5 percent from May 2010 to May 2011. FSCO data from the first quarter of 2011 shows an average increase of 1.78 percent. The target range set by the Bank of Canada to contain inflation ranges from 1 to 3%.
“Auto insurance premiums that are renewed today can reflect rates that were requested up to one year ago,” said Ralph Palumbo, Vice-President IBC, Ontario, in a statement. “The tangible benefits of Ontario’s auto insurance reforms will take some time before they are realized by consumers. The good news however, is that we are already seeing that premium increases when they occur, are keeping pace with the rate of inflation.”
