Ontario government commits to auto insurance regulation review
Published: November 19, 2018
CATEGORY: Car Insurance
During the summer elections in Ontario, most parties run with the promise of making changes to the troubled auto insurance system in the province. However, since winning office the governing Progressive Conservatives under Premier Doug Ford have not detailed their plans, aside from some movements to end territorial assessment.
There now seems to be more changes afoot as the Ontario government announced last week it will commission a “review how auto insurance rates are regulated”. Additionally, the government confirmed it will continue to control the Motor Vehicle Accident Claims Fund.
Under the current system, auto insurance rates are determined by the Financial Services Commission of Ontario (FSCO). To change rates (either increase or decrease), an auto insurance company must make a request to the FSCO, along with information that supports the change.
Private auto insurers in Ontario generally disapprove of having to go through the FSCO. Whether a review will help change this situation remains to be seen. However, the government says it will review regulations “jointly with the Financial Services Regulatory Authority of Ontario.” The announcement was made during the Progressive Conservative’s Economic Outlook and Fiscal Review.
In 2017, Ontario formed the Financial Services Regulatory Authority (FSRA), which will eventually become the auto insurance regulator, replacing the FSCO. Earlier this year, the then ruling Liberal government announced the FSRA will begin operations in April 2019.
The Progressive Conservatives have not said if this timetable has changed, although it is likely to remain in place. Not least because the review will be developed by the FSRA alongside the government and any changes made as a result of the findings will fall under FSRA’s regulatory control.
The Ontario government said Thursday it “is committed to creating a regulatory framework that allows for a more modern auto insurance sector.”