Automotive

[Ontario] Will this work for Bramptonians? Private members' bills aim to end auto insurance postal code 'discrimination

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  • Oct 25th, 2018 12:23 pm
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alanbrenton wrote: https://www.cbc.ca/news/canada/toronto/ ... -1.4863724

A pair of private member's bills set to be introduced today aim to stop auto insurance companies from using a person's postal code or phone number to set premiums.

Legislators from both the Progressive Conservative government and the NDP say they will introduce their own pieces of legislation today to stop the practice that they called discriminatory.

Parm Gill, a Tory legislator from Milton, says the practice means drivers from the suburbs around Toronto pay higher rates than people in other areas of Ontario.

Gill says his bill would ensure drivers are evaluated based on their driving record and not where they live.

NDP legislator Gurratan Singh says his bill, if passed, would require the Financial Services Commission of Ontario to refuse to approve risk classification systems that don't consider the Greater Toronto Area as a single geographic region.

Singh says his bill would result in lower insurance rates for GTA drivers.
What an idiotic plan. Brampton has the highest auto insurance rates for a reason and not because of some imaginative geographic rule. Highest rate of fraud and highest accident rates would generally mean higher auto insurance premiums. We all know that men pay higher insurance rates than women because of higher risk. I am perfectly fine with that..but if this idiotic bill passes through I expect the rates between women and men to become equal.
alanbrenton wrote: Is this an election ploy?
Nothing but an election ploy..
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I read insurance companies may increase rates due to legalization of marijuana.

More people driving while stoned.
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Iamashill wrote: Don't care if it's actually cheaper or not.

It will end the postal code, age, driving record etc discrimination.

$4000-$8000 a year insurance needs to end.

Insurance in this province is out of control.
If you're paying that much, get off the road.

Even when I was a teenager my rates were never ever close to that high amount. Sorry, anyone who has premiums that high more than likely deserves it to be that high!

Anyone who lives in the GTA knows that Brampton has more accidents and more fraud than any other municipality.
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chimaican wrote: If you're paying that much, get off the road.

Even when I was a teenager my rates were never ever close to that high amount. Sorry, anyone who has premiums that high more than likely deserves it to be that high!

Anyone who lives in the GTA knows that Brampton has more accidents and more fraud than any other municipality.
I'm in my 20s and a quote on Kanetix gives me near ~$4000 annual premiums for a typical car with $1 million in liability coverage and $1000 deductibles.

I'm from Richmond Hill, been driving for a few years with my full G. No tickets/accidents.

If I were a year or two younger, I'd definitely exceed $4k.

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You guys don't need a private members bill. What you need is proper drivers education. The problem is that people come here from other countries and bring their bad driving skills and then wonder why they are paying so much.

I drove to Mississauga/Brampton recently and you guys drive like $hit! Weaving around in traffic like morons! I say the same thing for the guys in Markham/Richmond Hill.

Now before someone thinks I am some racist white guy, let me set the record straight. I am Desi and have been in Canada over 40 years. 0 at fault accidents and 0 speeding tickets in the last 19 years.

Improve your driving habits, drive the conditions of the road, and use common sense. This applies for any gender, age, orientation or ethnicity. People just don't seem to get this. :facepalm:
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chimaican wrote: Want to pay less, live and/or commute in an area with fewer motor vehicle accidents and less automotive fraud.
That will not matter soon . The insurgence companies will raise the rates everywhere . This time using the government legislation as excuse .
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rugerty100 wrote: I'm in my 20s and a quote on Kanetix gives me near ~$4000 annual premiums for a typical car with $1 million in liability coverage and $1000 deductibles.

I'm from Richmond Hill, been driving for a few years with my full G. No tickets/accidents.

If I were a year or two younger, I'd definitely exceed $4k.

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Insurance companies in Ontario can no longer rate based on age. They use a proxy - years of driving experience (actually, years of insurance coverage). Even much older drivers, if they are just starting out, now have to pay rates as you describe. That was the biggest complaint when they used the years of experience (insurance coverage) as a new rating method. There were a lot of complaints from older new drivers, but they fell on deaf ears because the insurance industry had to reckon for the high accident rate experienced by young drivers without having to hike rates massively across the board. Older new drivers that weren't that much of a higher risk ended up paying the price of lowering premiums for young drivers. I mentioned years of insurance coverage because some friends or workmates who got posted overseas and let their Canadian insurance lapse while they weren't driving in Canada faced very high premiums when they came back home. The trick was to keep at least PLPD on a car if it went into storage to keep rates from going up massively.

The biggest driving factor that makes insurance in Ontario the costliest in the country is fraud. There is no incentive for industry to deal with fraud. Because we are all obliged to have insurance and industry is guaranteed a profit of at least 12% under current rules, insurance companies simply hike rates when claims cost rise. We have no choice but to pay since none of us can walk away from coverage without giving up our transportation - not an option in areas with no public transportation.

I was quoted something ridiculous for my cottage - three times what I pay for my house and for less coverage - and not all insurers would cover it. The cottage is not some sort of Taj Mahal, just a 3-season place that wouldn't cost all that much to fix or rebuild compared to a house. I chose to self-insure as a complete rebuild cost will be covered after only a dozen years of premiums. Apparently, my waterfront location made my cottage a high risk for flood damage, in spite of the fact that the property sits on limestone bedrock over fifteen feet above the water level on Lake Ontario. Yeah - right - a flood of biblical proportions is nigh upon us. The point is, where insurance is nonsense for me, I can choose to self -insure. Cottages are probably too small a category for many insurers to deals with so competition is much more limited. Those cottage owners that do agree to pay such premiums are probably in a high-risk category and so are ready to pay such premiums. If I was forced to pay such premiums, the rates of those at greater risk might go down a bit. If I could get insurance that more reflects my real risk, then I would probably get it.

As to my house insurance, I had pretty good coverage from a local broker at a pretty decent price - quite competitive. The insurer was a Canadian company - Dominion Insurance. They got bought out be an American company. The next year, my renewal cost was double. The American company needed more income to cover their losses from U.S. claims following a few years of natural disasters down there. Needless, to say, I bailed and now have insurance with PC Financial (underwritten by Economical Insurance, another Canadian company). My rates are now a bit lower than they were with Dominion before they got bought out. The rates went down again once I paid off the mortgage, probably because I no longer was required to have coverage, unlike auto insurance which is obligatory across Ontario. My point with these last two examples is that because property insurance is not mandatory, insurance companies have more incentive to deal with fraud. They control their costs to maximize revenue to be profitable in the face of competition. Insurance companies that don't control costs in a competitive environment and simply hike rates, including in the situation of customers who may not want insurance at all, lose customers.
Last edited by Enlgma on Oct 17th, 2018 11:58 am, edited 1 time in total.
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Iamashill wrote: Don't care if it's actually cheaper or not.
It will end the postal code, age, driving record etc discrimination.
$4000-$8000 a year insurance needs to end.
Insurance in this province is out of control.
postal code, age, driving record, these are not discrimination? they are statistics based pricing, and particularly driving records are your OWN BEHAVIOR based statistic.
If you are paying $4000-$8000 a year insurance, you shouldn't be allowed to drive - it is terrible idea to even allow driver like this to drive and even allow them to skid on everyone else money.
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Enlgma wrote: Insurance companies in Ontario can no longer rate based on age. They use a proxy - years of driving experience (actually, years of insurance coverage).
Do you have a source for this? I tried Googling, but couldn't find anything. I know years of continuous insurance is a factor when calculating rates, but I'm pretty sure age is too.
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Why can't we just have it run by the province, i'm always jealous of my Quebec friends who quote their insurance in the hundreds of dollars... for the year.
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Ecsta wrote: Why can't we just have it run by the province, i'm always jealous of my Quebec friends who quote their insurance in the hundreds of dollars... for the year.
So in Quebec, all injuries stemming from a car accident is still paid by the government vs in Ontario, OHIP doesn't cover injuries relating to car accidents (your physio and chiro following an accident). You also cannot sue another party for their shitty driving which leads to your injuries. Both have their merits.

People don't want to be rated by postal codes (which is one of the only statistics that can be used) and the same people don't want to install a driving tracking monitor because it invades their privacy.
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kmarcie wrote: So in Quebec, all injuries stemming from a car accident is still paid by the government vs in Ontario, OHIP doesn't cover injuries relating to car accidents (your physio and chiro following an accident). You also cannot sue another party for their shitty driving which leads to your injuries. Both have their merits.

People don't want to be rated by postal codes (which is one of the only statistics that can be used) and the same people don't want to install a driving tracking monitor because it invades their privacy.
If only postal code is used, why is age, credit rating and years licensed rated?
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Enlgma wrote: Insurance companies in Ontario can no longer rate based on age. They use a proxy - years of driving experience (actually, years of insurance coverage). Even much older drivers, if they are just starting out, now have to pay rates as you describe. That was the biggest complaint when they used the years of experience (insurance coverage) as a new rating method. There were a lot of complaints from older new drivers, but they fell on deaf ears because the insurance industry had to reckon for the high accident rate experienced by young drivers without having to hike rates massively across the board. Older new drivers that weren't that much of a higher risk ended up paying the price of lowering premiums for young drivers. I mentioned years of insurance coverage because some friends or workmates who got posted overseas and let their Canadian insurance lapse while they weren't driving in Canada faced very high premiums when they came back home. The trick was to keep at least PLPD on a car if it went into storage to keep rates from going up massively.

The biggest driving factor that makes insurance in Ontario the costliest in the country is fraud. There is no incentive for industry to deal with fraud. Because we are all obliged to have insurance and industry is guaranteed a profit of at least 12% under current rules, insurance companies simply hike rates when claims cost rise. We have no choice but to pay since none of us can walk away from coverage without giving up our transportation - not an option in areas with no public transportation.

I was quoted something ridiculous for my cottage - three times what I pay for my house and for less coverage - and not all insurers would cover it. The cottage is not some sort of Taj Mahal, just a 3-season place that wouldn't cost all that much to fix or rebuild compared to a house. I chose to self-insure as a complete rebuild cost will be covered after only a dozen years of premiums. Apparently, my waterfront location made my cottage a high risk for flood damage, in spite of the fact that the property sits on limestone bedrock over fifteen feet above the water level on Lake Ontario. Yeah - right - a flood of biblical proportions is nigh upon us. The point is, where insurance is nonsense for me, I can choose to self -insure. Cottages are probably too small a category for many insurers to deals with so competition is much more limited. Those cottage owners that do agree to pay such premiums are probably in a high-risk category and so are ready to pay such premiums. If I was forced to pay such premiums, the rates of those at greater risk might go down a bit. If I could get insurance that more reflects my real risk, then I would probably get it.

As to my house insurance, I had pretty good coverage from a local broker at a pretty decent price - quite competitive. The insurer was a Canadian company - Dominion Insurance. They got bought out be an American company. The next year, my renewal cost was double. The American company needed more income to cover their losses from U.S. claims following a few years of natural disasters down there. Needless, to say, I bailed and now have insurance with PC Financial (underwritten by Economical Insurance, another Canadian company). My rates are now a bit lower than they were with Dominion before they got bought out. The rates went down again once I paid off the mortgage, probably because I no longer was required to have coverage, unlike auto insurance which is obligatory across Ontario. My point with these last two examples is that because property insurance is not mandatory, insurance companies have more incentive to deal with fraud. They control their costs to maximize revenue to be profitable in the face of competition. Insurance companies that don't control costs in a competitive environment and simply hike rates, including in the situation of customers who may not want insurance at all, lose customers.
Insurance Companies in Ontario can and do rate based on age. They also use the number of years driving, etc. You may be referencing other provinces, such as NFLD, NB where age is not an acceptable rating criteria but in Ontario its an acceptable rating variable. Just like credit score is allowed to be used for auto insurance in Alberta and QC but is not in other provinces.
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Iamashill wrote: If only postal code is used, why is age, credit rating and years licensed rated?
Credit rating is not used for car insurance (in Ontario).

I didn't say only postal code is used. I was explaining why postal codes are used.

Age is used the same way postal codes are used. For instance, how many people in the database are within age 21-25? If so, how many accidents have they had? How much do these repairs/accidents cost? The number of years licensed is the first factor to look at - assuming, of course, the longer you've been licensed, the more experienced you are and less likely you are to have an accident. None of these numbers are going to be 100% accurate and applicable to everyone, but that's just how it's calculated.
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kmarcie wrote: Credit rating is not used for car insurance (in Ontario).

I didn't say only postal code is used. I was explaining why postal codes are used.

Age is used the same way postal codes are used. For instance, how many people in the database are within age 21-25? If so, how many accidents have they had? How much do these repairs/accidents cost? The number of years licensed is the first factor to look at - assuming, of course, the longer you've been licensed, the more experienced you are and less likely you are to have an accident. None of these numbers are going to be 100% accurate and applicable to everyone, but that's just how it's calculated.
Credit rating is not used?? Yeah?? Then why have multiple insurance companies and brokers asked me for consent to run a soft credit check?
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Iamashill wrote: Credit rating is not used?? Yeah?? Then why have multiple insurance companies and brokers asked me for consent to run a soft credit check?
That's likely to quote your home insurance.

Below is taken directly from FSCO website:
Regulation 664


Ontario Regulation 664 was amended in February 2005, to add certain financial information and other "lifestyle" factors to the existing list of underwriting and risk classification criteria that are expressly prohibited. This includes factors based on credit history and credit rating in addition to other factors such as residence history, occupation, profession or employment status, and level of income. None of these factors or surrogates for them are considered acceptable as underwriting or risk classification criteria. Please refer to Bulletin No. A-02/05 – Risk Classification and Underwriting Criteria, Non-Payment Terminations, and Fee Filing Guideline, for additional information.
Last edited by kmarcie on Oct 17th, 2018 3:54 pm, edited 1 time in total.
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Iamashill wrote: Credit rating is not used?? Yeah?? Then why have multiple insurance companies and brokers asked me for consent to run a soft credit check?
They asked because you're a shill Winking Face
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Oh this one time RFD, let me do down votes.
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Ecsta wrote: Why can't we just have it run by the province, i'm always jealous of my Quebec friends who quote their insurance in the hundreds of dollars... for the year.
I had a coworker from Quebec that was paying $175 per month... For a brand new car... with a newly reinstated licence after having a DUI and getting caught driving with a suspended licence.

I told them in Ontario you might pay $175 per month with a clean record easily and they nearly fell of their chair.

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