With car insurance rates going up an average of 19 per cent over the last year, consumers are looking for change. The newly elected provincial government has promised insurance rate reform and has begun by freezing insurance rates. But what does this mean for consumers?

More increases are possible

Freeze or not, car insurance costs may still go up for some people - even people who've not had any new accidents or tickets. What you see on your next insurance bill will greatly depend to the timing of your renewal and when your insurance company made its last rate change.

Explaining the "Freeze"

In Ontario, every insurance company must have rate adjustments approved by the Financial Services Commission of Ontario (FSCO). Usually, insurance companies only make rate changes once or twice a year, but over the last year, we have seen some companies apply for changes each quarter.

Car insurance rates were frozen as of October 23, 2003 for a planned 90 days. This means FSCO will not be approving any more rate increases in Ontario and rates will now stay at the level of the last approval.

What to expect on your next renewal

Here's where timing becomes a big factor. When a company changes its rates, the consumer doesn't see this impact until their next renewal date (usually only once a year). This means your insurance company could have made rate changes before the freeze that you won't see until you get your renewal documents in the future.

For example, if your car insurance renews in December 2003, and your insurance company was approved for a rate increase in September 2003 (before the freeze), you could still see your rates go up.

The same is true even if your policy doesn't renew until next summer. If your car insurance renews in August of 2004, and this same company was approved for rate increases back in September 2003, you may see your rates go up well after the freeze was implemented.

See the rate changes for your insurance company

Each quarter, FSCO publishes the new average car insurance rate changes for each company. This number represents the average change, which means some people will see less impact and some will see more. Click below to see the details of rate change made by your insurance company.

Auto Insurance Rates Q3 2005
Auto Insurance Rates Q2 2005
Auto Insurance Rates Q1 2005
Auto Insurance Rates Q1, Q2, Q3, Q4 2004
Auto Insurance Rates Q3 2003 (.pdf)
Auto Insurance Rates Q2 2003 (.pdf)
Auto Insurance Rates Q1 2003 (.pdf)

Bottom line - if the freeze remains in place, it will take up to a year for rates to stabilize, and Ontario drivers could still experience a rise in their car insurance costs well into 2004.

How to find savings now

If you are looking for quick savings, you should consider raising your deductibles. Most people have $300 or $500 deductibles but would never consider filing a claim for that little amount. If you can afford to absorb repair costs up to $1000, consider raising your deductibles to $1000 and save 5-10% off your yearly premiums.

What if you don't see a change?

If you get your renewal and your rate is the same, you should still consider shopping around. Rate changes usually include increases for some people and decreases for others. There may be another insurance provider who can offer you a better rate for your profile.

Find out what you will be paying

Interested in how the rate changes will affect you in the future? Compare car insurance quotes at Kanetix. Our service is always free, and if you see an insurance rate that interests you, one of our customer service representatives would be happy to connect you to the insurance supplier of your choice - no service charges, just savings for you.

Originally published in November, 2003

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