A provincial budget proposal to reduce auto insurance premiums by an average of 15 per cent is good news for Ontario drivers, but should not come at the cost of benefits available under the policy, says Toronto personal injury lawyer Stacey L. Stevens.
“In response to this announcement, the Insurance Bureau of Canada (IBC) predicts the reductions of premiums could result in a $1-billion loss for auto insurance companies if reforms are not put in place,” she says. Read Canadian Underwriter
In an interview with the Toronto Star, Donald Forgeron, president and chief executive officer of the IBC, says to reduce premiums, the cost of claims must also be decreased, and the government “seems committed to looking for new ways to reduce those costs.”
However, when specifically asked about the savings insurers expect to receive once the Anti-Fraud Task Force recommendations are put into place, Forgeron told the Star that “the industry will very happily and gladly pass on those savings to consumers in the form of lower premiums.”
Stevens, partner at Thomson Rogers, says, “It is premature to discuss the impact the reduction could have on insurers’ profits without being offset by further cuts to accident benefits until the Auto Insurance Anti-Fraud Task Force recommendations to the Financial Services Commission of Ontario have been put in place.”