Insurers, regulator counter auto rate hike claim

Thompson’s World Insurance News 
    Insurers and the provincial regulator say that Ontario auto insurance rates are coming down despite claims from the New Democratic Party that premiums are rising in anticipation of the recently-mandated cut. 
    “It is too simplistic to raise a couple of examples of rate increases without knowing the entire story,” said Ralph Palumbo, vp of IBC for Ontario.
    “We categorically reject any suggestion that rate increases represent an attempt to raise premiums in anticipation of proposed rate decreases as part of the Liberal government’s sensible cost reduction strategy. 
    The reality is that any current rate increase is based on rate filings made by insurers and approved by the provincial regulator well before the NDP demanded an arbitrary rate cut. To suggest otherwise is irresponsible.”
    Auto insurance rates are approved quarterly by the Financial Services Commission of Ontario. Rates approved during the first quarter of 2013 declined on average by 0.03%, based on the entire market.
    “An individual’s rates may change for a number of reasons: if they have moved, bought anew car or had a change in driving record,” Mr.Palumbo said.
    Kristen Rose of the Financial Services Commission of Ontario noted that auto insurance rates declined an average of 0.26% in 2012 and decreased further in the first quarter.
    She said it’s worth noting that when consumers see a rate change on their policy, they may be seeing a change that was approved six months to a year ago.
    “Consumers need to remember that their premiums vary based on their individual risk characteristics as well as the insurance company
    they use. 
    To ensure they’re getting the best possible deal, consumers need to shop around.”
    More in our June 10, 2013 edition

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