Drivers can opt out of some auto insurance: Ontario budget


Gov. Doug Ford revealed in his budget that drivers will be able to opt out of certain parts of auto insurance and choose from a variety of coverage options to reduce their car insurance premiums.

The government says the reforms are a central feature of the government's 2024 budget presented on Tuesday and will provide more affordable options for drivers, better access to benefits and create a more “modern” auto insurance system.

CBC News first reported the province intends to make changes to auto insurance ahead of Monday's budget.

“We are moving forward with auto-insurance reforms that will give drivers more choice and flexibility to keep their premiums more affordable,” Finance Minister Peter Bethlenfalvy said as he presented the budget in the legislature.

Compulsory auto insurance will continue to apply to “medical, rehabilitation and attendant care benefits,” according to the budget, while all other benefits will be optional. The government has not said when the changes will take effect.

A senior government official said Tuesday the province is unclear on what impact the reforms will have in Ontario and what the average interest rate will be on auto insurance premiums because it will depend on what individual drivers choose to do with their coverage.

Changes aimed at reducing paperwork, red tape: Ministry

The Ford government is also proposing to make auto insurance companies pay for medical and rehabilitation benefits after an accident – ​​before extended health care plans cover the costs. It says the policy will apply to all vehicle accidents, regardless of the extent of injury.

According to the budget, this will “help reduce paperwork and red tape for patients and their health care providers.”

“This is something we are committed to because … we want insurance to be affordable for many people,” Bethlenfalvy told reporters at a press conference Tuesday.

Bethlenfalvy said the reforms won't necessarily lower auto insurance rates.

“I don't think this is where we have any specific numbers in terms of the rate of increase or decrease,” he said.

“What we're really focused on is making sure we provide drivers as much choice and convenience as possible,” he said.

Bethlenfalvy said the government is also trying to encourage innovation and competition in the market, which could help on prices, adding that the reforms would create “stronger levels of coverage at reasonable prices”.

According to the Financial Services Regulatory Authority of Ontario, average premiums have increased by less than 10 per cent since 2019.

Ontario's 2023 budget has earmarked $49 million in funding to help police services across the province crack down on rampant auto theft and dismantle organized crime networks. (Ivan Mitsui/CBC)

Auto insurance rates have become a hot political issue in Ontario over the past few years. Official number from the provincial regulator, Cited According to the Auditor General, premiums have increased by more than inflation since 2022.

Opposition NDP worried about 'risk' of exit

Kathleen Wynne's previous Liberal government promised in 2013 to reduce auto insurance rates by 15 per cent within two years, but failed to meet that target.

The Ford government's 2019 reforms increased choice by allowing insurance companies to offer new types of discounts to drivers. Those options include lower premiums for drivers who agree to claim benefits only through the insurance company's “preferred providers” of auto repair or health care services.

Effective January 1, 2024, Ontario began allowing drivers to opt out of previously mandatory coverage called “Ontario.”Direct Compensation – Property Damage,” which reimburses drivers for damage caused to their vehicle in an accident in which they are not at fault.

Bethlenfalvy said the province is “finishing the work” of automating the license plate renewal process by eliminating license plate renewal fees and plate stickers.

The province says the proposed permanent cap on driver's license fees is expected to save drivers an estimated $66 million over the next five years. The freeze, which was implemented by the government in 2019, has saved drivers about $22 million so far.

Ontario NDP Leader Marit Stiles suggested that those who would choose less auto insurance coverage may be doing so for the wrong reasons.

“My concern and I think the concern of our caucus and our party is that this is going to force Ontarians who are looking for more affordable options to take additional risks,” Stiles told reporters. Should not be done.” A press conference at the Legislature on Tuesday.

“At the end of the day, Ontarians will be the ones who suffer.”

Stiles said the Progressive Conservatives also announced auto insurance reforms in the last budget and premiums have actually increased.

Police to get $49 million to combat auto theft, organized crime

The budget also addressed one of the major factors contributing to the increase in car insurance premiums – the persistent problem of auto theft across the province.

In response, the province has earmarked $49 million in funding to help police services across Ontario crack down on rampant auto theft and dismantle organized crime networks.

Look Ontario drivers frustrated after dealing with three car thefts:

This North York man has had three cars stolen in the last year

Michelle Levine's dealership told her to remove the anti-theft device installed in her Lexus – but when she did, it was stolen from a TTC parking lot. This is the third time in the past year that Levin and his wife's vehicle has been stolen.

According to the budget, an additional $46 million will also be invested over three years to launch a new air support program. This includes the purchase of four new helicopters that will be used by police services in the Greater Toronto Area to increase patrols and improve response times to major incidents.

“These helicopters will help police crack down on auto theft, as well as street racing, carjacking and impaired driving, while aiding the capture of violent criminals and locating missing persons,” Bethlenfalvy said at the legislature on Tuesday.


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