Auto Insurance Policy Changes
Important changes to your auto policy are on their way! By now you have likely received a notice in the mail from your car insurance company or can expect it is on its way. Effective June 1st, 2016 the Ontario Government is introducing changes to the automobile insurance system to help make your insurance premiums more affordable. These changes mean you now have more choice over the coverages you select.
We have already seen certain changes mandated by the Ontario Government to help make auto insurance more affordable. For example it is now mandatory for insurance providers to offer a Winter Tire Discount to anyone who installs certified winter tires on their vehicle in the winter months. The Ontario Government did not want to stop there and that is why effective June 1st we are going to see the 2016 auto reform. Here is what you can expect:
Minor Collisions May Not Affect Your Rate
Ever been involved in a minor collision where there is minimal damage to the involved vehicles and no one is hurt? You awkwardly get out of the car, check your vehicle and see that it is fine. The vehicle you rear ended also looks fine but the person that you hit calls to report an accident. Well guess what? Even though there was minimal or no damage you now have an at-fault accident on your record and at renewal you can expect to see your rates jump up. Well come June 1st that will be no more. As long at the following criteria applies, a minor collision will not be factored into your premiums:
- The minor collision happens on or after June 1st, 2016
- There are no injuries and the damage is less than $2000 to the vehicle
- No claims are submitted to insurance for payment
- As the at-fault driver you pay for any damages to both vehicles
There is a catch. You are limited to one minor accident every three years.
Decreasing Service Fees on Monthly Payments
For most of us paying for your car insurance on a monthly basis makes sense. However, most insurance companies charge you a service fee to do so as they would rather you pay in one lump sum. Companies used to be able to charge the insured up to 3% for a monthly payment plan, but that has now been decreased to 1.3% (sort of a random number) with several companies getting rid of the service fee entirely. Nice!
Increased Deductible Lower Premiums
The deductible under the comprehensive portion of your policy is changing. You deductible is the portion of an insurance claim that the insured (you) is required to pay in the event of a claim, the insurance company pays the rest. For comprehensive coverage you used to be required to carry a minimum standard deductible of $300 but that is increasing to $500. In general, the higher the deductible, the lower your premium but the more you are responsible for in the event of a claim.
Accident Benefits are Changing
This is an area where the Ontario Government has elected to reduce coverage in order to make auto insurance more affordable. Your accident benefits are in place should you get into an accident and are injured, regardless of who is at fault, you are entitled to certain benefits that cover things such as medical and rehabilitation care, income replacement, or home maintenance. With the new auto reform some of the standard coverages are changing, with the option for you to buy back up. For a full list of the changes to your accident benefits click here.