Ontario brokers support bill seeking lower auto insurance

Ontario brokers support bill seeking lower auto insurance premiums for new drivers

An Ontario member of provincial parliament has introduced a private member’s bill that could allow new drivers with clean driving records lower auto insurance premiums, in line with what more experienced drivers pay.

Mike Colle, MPP for Eglinton-Lawrence, introduced the Insurance Amendment Act (Minor Accidents and New Drivers) 2013 on Thursday, and the first reading was carried.

If passed or adopted by the provincial government, new drivers could pay less, but would have premiums increase in the event of an at-fault accident.

The bill would also require that drivers who have had minor accidents under $2,500 in damages, without bodily injury and paid out of pocket, not receive higher insurance premiums. If a driver is convicted of a traffic offence such as speeding, they could also revert back to having a poor rating.

The proposed legislation is similar to an amendment passed in New Brunswick as part of reforms in 2005 (known as the “First Chance” system).

Colle’s proposal has received support from the Insurance Brokers Association of Ontario (IBAO).

Last month, the province’s minister of finance, Charles Sousa, issued a policy statement that directed the Financial Services Commission of Ontario (FSCO) to review ways to “treat first-time drivers fairly” and to study the mandatory collision reporting threshold as a “potential cost reduction” initiative, the association noted.

“We believe the ideas laid out in Mike Colle’s bill deals with some of the affordability and fairness issues that the government is asking FSCO to address,” said Randy Carroll, IBAO’s CEO. 

“As brokers, we share these concerns because we deal directly with our customers who are affected by these issues every day.  We hope that these ideas will find support in the Legislature and within the government to make the system more fair and affordable for our customers.”

_{Source: canadianunderwriter.ca}