News: GTA drivers face 14% insurance hikes, TorStar

[TorontoBoy]

I'm not surprised that Toronto has terrible drivers, as this is a given, but double digit increases in a year seems excessive. Today's Toronto Star. I wonder how this will affect MC insurance?

Millions of Ontario drivers are about to be slammed with double-digit premium hikes, with the average Toronto-area driver likely to pay nearly 14 per cent more.

Ten insurers serving more than a quarter of Ontario drivers have just been cleared to raise their rates a second or third time in about 12 months.

Their policyholders will be hit with increases averaging between 11 and 19 per cent when the policies come up for renewal, joining drivers insured by several other companies that had already been cleared for double-digit increases. Another seven companies have been cleared for smaller increases in the latest round of approvals.

But these are only provincial averages, which do not represent what most GTA drivers can expect to pay.

Calculations by the Star show that Toronto-area policyholders of the 17 companies face an average increase of 14 per cent, while in the province as a whole drivers will see an increase of 9.1 per cent.

Insurers serving about 27 per cent of drivers have been granted double-digit province-wide increases. These include AXA Insurance (Canada) at 12.2 per cent, Kingsway General Insurance (recently renamed Jevco Insurance) at 21.2 per cent, State Farm Mutual Automobile Insurance at 12.5 per cent and Wawanesa Mutual Insurance Co. at 15.1 per cent.

[Leathal]

I'm not surprised that Toronto has terrible drivers, as this is a given, but double digit increases in a year seems excessive. Today's Toronto Star. I wonder how this will affect MC insurance?

CP24 just said this morning that four of the big insurance companies have been given the go ahead by the government to raise their rates. They have done do by 15 to 19% right across the board, and CP24 went on to say that rates could be raised to as high as 30% by the time the dust settles.

Leathal

[chinto]

it's criminal.

[mxs]

It looks like that this government instead of dealing with public transit and insurance scams (excessive milking by health care a car repair providers ...) decided to make people just quit driving /riding and thus get some more vehicles off the road by letting the rates run significantly up withing one year.

Absolute joke what these clowns are doing.

[topendz]

This will no doubt affect motorcycles sales in 2010. This luxury item is becoming more out of reach for the average consumer. This is very bad news for the motorcycle industry. I would hope that people like the MMC will show their displeasure.

[meme]

Good point Simon. If my insurance hikes a great deal this year that's it. I will pull the plug and just hit the track.

It's too bad really, but it is becoming an expensive luxury as you state.

[2smokewilleh]

This is all because the government wont step up and reform our current insurance regulations so that the milking/abusing of the system will be stopped, allowing rates to come back down by reducing the exploding claim costs.

[jailbreak]

These criminal insurance companies.. Totally bs.. And what's worse is that the government is on their side.. Of course they would be if they are getting more money from them when they make more from us..

[2smokewilleh]

These criminal insurance companies.. Totally bs.. And what's worse is that the government is on their side.. Of course they would be if they are getting more money from them when they make more from us..

You are totally uninformed and completely wrong.
1) If you look at published data, almost all of the Ontario insurance companies are actually LOSING money on auto insurance due to rising claim costs (Paying upwards of $1.70 for every dollar taken in on premiums). This increase has been fought for so that the insurance companies can return to profitability.

2) The government is NOT on side with insurance companies. They oppose them all the way, to get an increase like this, the insurance companies had to prove to the regulators that they need to be able to raise rates to stay in business.

[Trowa]

You are totally uninformed and completely wrong.
1) If you look at published data, almost all of the Ontario insurance companies are actually LOSING money on auto insurance due to rising claim costs (Paying upwards of $1.70 for every dollar taken in on premiums). This increase has been fought for so that the insurance companies can return to profitability.

2) The government is NOT on side with insurance companies. They oppose them all the way, to get an increase like this, the insurance companies had to prove to the regulators that they need to be able to raise rates to stay in business.

regardless of a loss or not. insurance companies are still scams in ont compared to out west.

[roadtoruin]

ah fantastic, just another cost of life going up while my wage stays the same...

[2smokewilleh]

regardless of a loss or not. insurance companies are still scams in ont compared to out west.

No they're not. THey offer a different product..

If you get in a car accident in ontario, your policy covers you for $100,000 of med/rehab over 10 years, plus income replacement and many other benefits.. possible claim costs can exceed $500,000 for non-catostrophic injuries..

Out west: You might get $5000 over a 4 month period, tops. Much less, you just get what you pay for. Insurance companies in ontario would like to offer a lower-costing (less rich) policy, which many people would prefer to take, like they do out west, but the government wont allow that.

Just think, you get what you pay for.. You'd probably pay much more out west to get the same coverage for everything (injuries included), than you do here.

[VifferFun]

2smokewilleh has already explained the issue, and if you want to learn more you can read my sticky.

FYI, you can find the Auto Quarterly Rate Approvals (by company) on FSCO's website. Note that this is the AVERAGE rate change by company. Depending on the company's targeting or experience with certain risk characteristics (such as age, location, driving history, etc.) your increase could be more or less than the published average. In fact, it is possible that your rate will decrease when the average rate increases, or that your rate will increase when the average rate decreases. Here are FSCO's (the regulator) approved rate changes:

http://www.fsco.gov.on.ca/English/insurance/auto/rates/

Motorcycle premiums will not necessarily follow suit, but if auto claims are increasing than chances are pretty good that motorcycle claims are as well. Motorcycles are analyzed independently of Auto, and usually Motorcycles aren't analyzed as often for insurers that also write Auto (since the percentage of motorcycles on a company book of business is usually pretty small in comparison). I would expect that motorcycle-specific insurers such as Jevco would be more responsive to changing claim costs, since this is the only line of business that they deal with.

[TorontoBoy]

I'm trying to figure this out.

This year my cage insurance company was approved for a 3.41% increase just before my renewal, and I received a 6.85% decrease. My bike insurance increased 3.92% during the same time.

Vifferfun, I see the Auto Quarterly only covers private passenger cars. Is there a similar "Motorcycle Quarterly" web page that publishes comparable rate increases for motorcycles? I tried looking this up before but could not find it.

FYI My house insurance went up 18.71%. Go figure?

[Avi Singh]

I'm trying to figure this out.

This year my cage insurance company was approved for a 3.41% increase just before my renewal, and I received a 6.85% decrease. My bike insurance increased 3.92% during the same time.

Vifferfun, I see the Auto Quarterly only covers private passenger cars. Is there a similar "Motorcycle Quarterly" web page that publishes comparable rate increases for motorcycles? I tried looking this up before but could not find it.

FYI My house insurance went up 18.71%. Go figure?

The increases approved are for average overall increases. So while your auto may have decreased someone elses will increase. As already stated the primary driving force behind the auto rate increase is the accident benefits, as such it is reasonable that a motorcycle would see an increase.

Property will likely see the highest percentage increase as the number of large weather related claims is on the increase. While that is happening, it is increasingly difficult to find a qualified, licensed contractor able to start tomorrow, and the cost to get them to a site is also on the rise.

[VifferFun]

I'm trying to figure this out.

This year my cage insurance company was approved for a 3.41% increase just before my renewal, and I received a 6.85% decrease. My bike insurance increased 3.92% during the same time.

Vifferfun, I see the Auto Quarterly only covers private passenger cars. Is there a similar "Motorcycle Quarterly" web page that publishes comparable rate increases for motorcycles? I tried looking this up before but could not find it.

FYI My house insurance went up 18.71%. Go figure?

I don't know of any Motorcycle Premium Changes being published. You are an example of the person who's rate decreases even though the overall rates have increased. Everyone's rate does not change equally due to the risk targetting involved with a rate change -- some premiums go up, and some premiums go down. If you are familiar with statistics, the rate change is usually a normal distribution (bell curve), with the peak number of policyholders experiencing the average rate change:

[Buddhacide]

ah fantastic, just another cost of life going up while my wage stays the same...

This. Off to eat another $3.00 can of tuna now....

Edit: BTW Jevco seems to be increasing more than others. I just read in the paper it was the one company I took note of that will be increasing rates by more than 20%.

[eastcoast_gsx]

Time to take liability insurance OUT OF PRIVATE hands and make it a non-profit Public Corporation, and Stop the insane payouts for BS claims.

If you want more, go get it from mom and dad robs allot.

[Avi Singh]

This. Off to eat another $3.00 can of tuna now....

Edit: BTW Jevco seems to be increasing more than others. I just read in the paper it was the one company I took note of that will be increasing rates by more than 20%.

Remember that when you read Jevco in the papers in regards to Auto Insurance, it really is the former Kingsway General.

[twinn]

This will no doubt hurt the motorcycle industry. Insurance rate increases added to the already weak economic picture will mean less sales for new bikes next year as well as more downward pressure on used market. It will hurt the whole SS segment, and will kill the large displacement market.


I wonder what effect this will have on the new car market as well, as I remeber when I was 20-25, the only thing that kept me from buying a brand new car was the insurance premium on them, it was almost the same as the actual car payment itself.


I am mixed about my feelings about the industry as a whole. I understand the numbers and why they need to raise rates, however, in my mind, insurance companies along with lawyers seem to be okay with the fraud taking place.

I am not going to look it up, but the latest private members bill that was proposed re insurance ( i beleive it was supported buy the insurance companies as well) was to lower our minimum from 200K liabilty to something like 25K.

Thats just insane, why don;t the insurance companies and their lobbies go after tort reform laws instead? By decreasing the min liabiity limit, all they are doing is going after the the low income population, the people that can;t afford to pay the higher premiums and need to drive anyway (students, under 30 crowd,etc..) These are the people that are going to be screwed should there accident benefits cost more then 25K.