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Ontario Automobile Insurance Reform

Ontario Automobile Insurance Reform


Posted January 15, 2019

On January 9, 2019 the Ontario Government announced that it is seeking ideas on how to make auto insurance more affordable. The Government is inviting drivers and consumers to share their opinions on how to lower auto insurance rates. The Minister of Finance said that “auto insurance is clearly broken. Auto insurance rates in Ontario are among the highest in the country, and action is needed.”  This consultation process is a first step in fixing auto insurance.

The Government has invited consumers and businesses to share their views on auto insurance by visiting this link by February 15, 2019.

The Government’s consultation corresponds with a review of Ontario’s auto insurance rate regulation system. This review is conducted by the Ministry of Finance and the Financial Services Regulatory Authority of Ontario. It will examine insurance schemes in other jurisdictions in order to identify ways to realize greater efficiencies and bring more competition to the auto insurance industry.

Ontario has almost 10 million licensed drivers and all drivers must have auto insurance. Ontario’s two pronged auto insurance system was introduced in 1990.  The Government enacted the “Ontario Motorist Protection Plan” or “OMPP”. The OMPP was designed as a balancing act: injured people with smaller claims lost their right to sue for damages and, in return, all people injured in car accidents had timely access to health care and income replacement benefits. Everyone injured in a motor vehicle accident had access to these benefits regardless of who was at fault. These “No‑Fault” benefits were meant to save the insurance industry money while providing premium reductions to motorists. Only people with serious injuries were permitted to sue for full compensation.

At first the restrictions placed on the right to sue in exchange for increased No-Fault Benefits worked satisfactorily.  However in subsequent years, the No-Fault Benefits available to injured people have been repeatedly and drastically reduced while premiums increased. As a result Ontario drivers are paying more and receiving less protection than they did in 1990. There have been additional restrictions imposed on the right to sue and, at the same time, reductions in the amount of No-Fault Benefits available. When enhanced No-Fault Benefits were introduced anyone injured in a car accident had a maximum of $100,000 available for treatment expenses. Most injured accident victims now only have $3,500 to cover treatment expenses. The most catastrophically injured accident victims have had a 50% reduction in the funding available for necessary treatments.

We all want lower auto insurance premiums.  However most people are unaware of the reduced benefits that are likely available to them if they are injured in an accident. Unfortunately many accident victims are shocked to learn how little they can recover in No-Fault Benefits and tort damages. There are optional additional No-Fault Benefits available and until there has been a major improvement in the current compensation system all drivers should consider purchasing them. Discuss your current level of No-Fault Benefits and potential additional coverage with your broker.

This blog post was written by Edward (Ted) Masters, a member of the Disability Insurance Claims and Personal Injury teams. He can be reached at 613-566-2064 or at

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