Wynne gov’t promising to save you money on car insurance
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(Updated)
Ontario finance minister Charles Sousa says new legislation introduced today should save you money on car insurance — even though the Liberals aren’t mandating a cut to premiums. The bill aims to cut down on fraud and make it easier to settle disputes.
The Liberals agreed to cut car insurance by an average of 15 per cent over two years to win NDP support for last year’s provincial budget. Today Sousa said this bill will help them reach that goal — but drivers say they’ll believe it when they see it.
“The rates right now are wow, way out of whack.”
Sousa says in the last six months, auto insurance rates have dropped about five percent on average across the province. But drivers we spoke with in Hamilton say they have yet to see a change.
“Not yet. Matter of fact I just checked online this morning and it’s still the same as of this point.”
“I don’t see it going down. And if you do change to other insurance it goes down but when you’re with them for a while it goes back up again.”
With new legislation introduced today, Sousa says rates will fall by 15 per cent by 2015.
“Right now it’s costing us a lot more by allowing the system to work in the way that it is now.”
If passed, the Liberals say the bill would, in part, make it easier to settle disputes by moving the resolution system to the ministry of the attorney general’s licence appeal tribunal. It would ensure only licensed health service providers get paid directly by insurers, and reduce the amount of time a vehicle can be stored after an accident without notice to the driver.
Ralph Palumbo, Ontario vice-president of the Insurance Bureau of Canada says the bill will drive out unnecessary costs in the system to allow premiums to come down.
“I think it’s going to mean a lot for consumers frankly, because what it’s going to do is make sure there is a dispute resolution mechanism for starters that’s going to be more efficient and will actually get benefits sooner to those people that are waiting in those 15,000 arbitration backlogs. ”
NDP consumer services critic Jagmeet Singh accuses the government is putting insurance companies first.
“This is an issue of profits. We know that we need to get at the true profits that the insurance companies are making and we know that the profits are there. We need to make sure that those profits the insurance companies are enjoying translate into reductions for the people of Ontario.”
The PC critic for auto insurance reform, Jeff Yurek also isn’t convinced.
“You’ve seen the NDP-Liberal plan give big discounts to drunk drivers and poor drivers and rates going up for the good drivers so, I don’t know how we can believe his new plan is going to be any better going down the road.”
Critics point out Ontario made regulatory changes in 2010 that greatly reduced costs for the insurance industry, but those savings have not been passed along to drivers.
