Ensuring Auto Insurance rates are fair and accurate

The Financial Services Regulatory Authority of Ontario (FSRA) is releasing its Annual Review Guidance and Benchmarks to ensure auto insurance rates remain fair and reasonable for consumers.

FSRA uses these benchmarks to review insurance companies’ proposed rate changes and monitor trends in the auto insurance industry.

Some highlights of the updated expectations include:

• Auto theft: Although still above pre-crisis levels, theft-related claims in Ontario are improving. Insurers should reflect these improving trends in pricing for high-theft-risk vehicles. FSRA will evaluate insurers’ actuarial justifications to ensure pricing is fair for consumers.
• Electric vehicles (EVs): When electric vehicles first entered the market, insurers had limited claims data. With more data now available, FSRA expects insurers to ensure EV rating practices are supported by actual and emerging claims experience.
• Personal vehicle use for app-based rideshare: Many Ontarians use their personal vehicles for rideshare purposes. Some insurers have underwriting rules that restrict or penalize this use. FSRA expects insurers to review their rating and underwriting practices to ensure consumers with commercial rideshare coverage are not denied personal insurance, nor charged additional premiums because they use their vehicle for rideshare.
• Driving experience from outside of Canada: The Ministry of Transportation (MTO) recognizes driving experience from outside of Canada through reciprocal agreements. Insurers are expected to recognize the MTO-verified foreign driving experience in their rating and underwriting practices as soon as practicable.

FSRA continues to evaluate and enhance its processes to achieve regulatory efficiency and effectiveness. FSRA will continue to consult annually and update its benchmarks twice a year.

Learn more:

• Annual Review Guidance and Benchmarks
• Benchmarks Consultation Summary

FSRA continues to work on behalf of all stakeholders, including consumers, to ensure financial safety, fairness, and choice for everyone.

Learn more at www.fsrao.ca.