Ontario Liberals to Cut Auto Insurance; but is it Enough for the NDPs? | Canadian Mortgages Inc. , 'opacity': false, 'speedIn': , 'speedOut': , 'changeSpeed': , 'overlayShow': false, 'overlayOpacity': "", 'overlayColor': "", 'titleShow': false, 'titlePosition': '', 'enableEscapeButton': false, 'showCloseButton': false, 'showNavArrows': false, 'hideOnOverlayClick': false, 'hideOnContentClick': false, 'width': , 'height': , 'transitionIn': "", 'transitionOut': "", 'centerOnScroll': false }); })
  • Follow us on
  • Facebook
  • Twitter
  • Linked In

For a no fee consultation call: 888-465-1432

Ontario Liberals to Cut Auto Insurance; but is it Enough for the NDPs?

The Ontario Liberals have pledged to cut auto insurance rates for Ontario drivers by 15 per cent, thought of as a move to appease the NDPs so they’ll push the budget through and therefore, avoid an election. The question is though, will it be enough?

It’s no wonder that an outcry was heard. Finance Minister Charles Sousa has said that rates in Ontario were as much as 10 times higher than they are in the rest of the country. ┬áIt’s no wonder that the NDPs have already called for a 15 per cent rate cut across the board. But they likely won’t get it with the Liberals’ new budget.

The problem is that the entire issue is a tricky one. Implementing such a major rate cut will take time, and will require both the government and the insurance companies to communicate and work together. Plus, with different regions of the province charging different auto insurance rates, it only further complicates the situation.

“My proposal would be to maintain some flexibility, so that we can achieve those targets as quickly as possible,” he said when announcing the proposed legislation. “But we need to ensure we have oversight and that we work collaboratively with the industry and find ways to implement those targets as quickly as possible.”

The NDPs want auto insurance rates cut by 15 per cent, but just how much drivers would actually see in a discount is still unclear. It is known that the Liberals want to require insurers to provide a discount for drivers with a good driving record. Sousa says that he expects the Liberals new measures to reduce insurance by $225 a year for all drivers.

He also pointed to the different regions being a priority though, and wants to focus on getting the rates down in areas where they’re highest first.

“In certain circumstances, let’s be realistic, there’s going to be areas where we need to ensure that those risks are eliminated, and that is what we need to do to enable those rate reductions to occur in those areas that are at higher risk,” he stated.

But whether it’s enough for the NDP has yet to be seen.

“We have not yet seen any details from the government and we want to look at the budget closely,” said NDP Leader Andrea Horwath. “New Democrats have made it clear we want to see a plan that works for drivers and reduces their premiums by 15 per cent over the next year.”

If this goes through, it will be very similar to the last time the Liberals reduced auto insurance rates, back in 2004 – that time it was in an attempt to get re-elected. It worked, and rates were lowered for a short time. But it was only six or so months before rates went back up. That fact is something that will surely be under scrutiny should rates be cut this time.

Leave a Reply








Security Code: