As of June 1, 2016 there will be a number of new auto insurance reforms in Ontario as part of the provincial government’s initiative to decrease auto insurance rates and allow insurance customers to have more choice with their policies and coverage.
What is going to change?
Auto insurance changes will include lower accident benefit limits in standard insurance policies, new provisions for reporting minor accidents, different coverage options, and changes to payments interest charges.
Most of the new reforms are going to modify statutory accident benefits. These are benefits you are entitled to receive if you are injured in an auto accident, regardless of who is at fault.
Currently in Ontario, vehicle owners must buy accidents benefits insurance. This gives you coverage for up to $50,000 in medical and rehabilitation benefits, and $36,000 for attendant care if you have a non-catastrophic injuries. As of June 1, the mandatory accident benefits coverage will change to $65,000, and combine the medical and rehabilitation benefits with attendant care for non-catastrophic injuries. For catastrophic injuries, medical and rehabilitation along with attendant care will be combined and reduced to $1,000,000 coverage total.
Caregiver and the Housekeeping and Home Maintenance benefits will also be modified. These are benefits that cover if you are unable to continue as the primary caregiver to dependents, and/or if you need to hire someone to maintain your home because you are unable to. As of June 1, you can choose to have this coverage extended to all injuries.
Reporting Minor Collisions
If you get into a minor car accident on or after June 1, 2016, it may not affect whether your insurer will issue, renew, or cancel a contract if the following applies:
- The damage to each vehicle involved in the accident (including any property damage) is less than $2,000, and the at-fault party pays the costs of all the damages.
- There were no personal injuries.
- There are no payments made by any insurer for damage to the vehicles or property resulting from the accident.
There is an exception. If you were involved in more than one minor accident in the previous years, and each time you were at fault, your insurer can factor it into issuing, renewing, or cancelling your contract or determining your premium.
Individual policyholders may experience a rate change depending on factors such as:
- The vehicle insured;
- Where he or she lives, driving experience; and at-fault accident and conviction history, what the vehicle is used for (i.e. commuting), and other risk factors;
- The amount of coverage purchased, deductibles, or liability limits.
Additionally, if you purchase your policy annually, any changes approved by your insurer and effective before the renewal date, or changes in the policyholder’s circumstance after their last renewal (i.e. tickets, at-fault accidents) will impact your rate when you renew.
Interest charges for making monthly payments will also decrease from three percent on an annual policy to 1.3%, with similar decreases for shorter-term contracts.
As an insurance customer, how will these new reforms affect me?
All of these new reforms mean that your insurance premium may be impacted. Your insurer should have notified you about the new modifications at the end of March or early April about how it may affect your policy and when the changes are in effect. You can contact your insurance representative if you have any questions.
Your policy will not change until your renewal period. After June 1, 2016, you have the option to change your current policy with some of the new amendments.
Time to shop around for a new policy
These new changes mean that it is a great time to start shopping around for a better policy. At isure, we will do your insurance shopping for you and present you with the best deal out there, all without compromising on coverage.
By Filling out the below form you authorize our licensed brokers to contact you. Among 25+ insurers we represent, they may know an insurer who can give you a better rate so you can start saving when your term comes up for renewal after June First.