Reducing Auto Insurance Rates: Ontario Takes Action

Reducing Auto Insurance Rates: Ontario Takes Action

As part of the next step in auto insurance Cost and Rate Reduction Strategy, Ontario has introduced new legislation that, if passed, will help reduce insurance rates as well as fight fraud within the auto insurance system.

Bill 171, Fighting Fraud and Reducing Automobile Insurance Rates Act, 2014, proposes to amend such acts as: The Insurance Act, The Repair and Storage Liens Act, The Licence Appeal Tribunal Act, The Motor Vehicle Accident Claims Act and The Financial Services Commission of Ontario Act.

The Insurance Brokers Association of Ontario believes that this bill is essential for Ontarians. Back in August of 2013, the province announced its plan to reduce auto insurance rates by around 15% within the coming two years. Without the introduction of this Bill, they believe that it would not happen.

If this bill is passed, then consumers would gain added protection from insurers and Ontario could continue to combat auto insurance fraud by:

  • Transforming the auto insurance dispute resolution system could help settle claims in a more timely manner; this will also       decreases administrative costs and reduce financial pressures, meaning more money in your pocket at the end of the day
  • Tackling questionable practices by towing and vehicle storage industries by regulating them
  • Allowing the province to change its current 60-day after accident storage period

Some Highlights of Bill 171 include:

  • Proposal to disallow policyholders from bringing disputes under any conditions (Bill 171 says that no one can bring a  proceeding in any court with respect to a dispute over accident benefits, other than an appeal from an Appeal Tribunal
  • Proposal to allow only licenced health care providers to get paid on claims directly by insurance provider
  • Proposal to change the “prejudgment interest rate on general damages for pain and suffering” in auto claims (currently at 5%), to a fair market rate

The Liberals have proposed implementing a public sector administrative tribunal to deal with all auto insurance disputes. If this Bill is passed, the onus will switch from the FSCO to the Ministry of the Attorney General to administer the dispute resolution system.

 

Lisa-Marie Hill is a Paralegal student at Centennial College in Toronto studying professional communications with Omar Ha-Redeye.

Leave a Reply

Your email address will not be published. Required fields are marked *