Auto Insurance in Ontario: A Call For Transparency

by Kris Bonn
All cars in Ontario must have auto insurance in case of collisions

Auto insurance in Ontario is big business. The law requires that every vehicle have auto insurance and this creates a readymade market for insurance companies. In 2017 and 2018 auto insurance companies in Ontario made pre-tax profits estimated at $2.3 billion. That is a lot of money. When an industry is making that much money from a government regulated and mandated business, there must be transparency to hold the private, multi-national insurance companies accountable.

Stricter government-imposed requirements for transparency from auto insurers is needed. 

Currently, there is no requirement that insurance companies provide the details of what exactly they earn from their different lines of insurance business in Ontario. This needs to change. 

We need our government to require auto insurance companies to be more transparent about the profits they are earning from Ontario drivers.

Innocent victims of auto collisions are forced to deal with increasing deductibles on their claims for pain and suffering damages. This means that in 2021 the innocent injured victim of an auto collision will: 

  • not be paid the first $39,753.31 of his or her pain and suffering damages. 
  • only be compensated for 70% of their pre-trial income.
  • likely be forced to wait years for an insurance company to settle their file or to get to trial and will not be paid the market rate for interest on the money that should be paid to them.

Instead, the for-profit private insurance company keeps this money.

The auto insurance system in Ontario needs to change.

The most pressing area for change with regards to the auto insurance system here in Ontario starts with increased transparency. The auto insurers need to come clean about what they actually pay out on claims compared with what they bring in for premiums. This requires full details on first-party accident benefits, property damage claims for repairing the physical damage to vehicles and what is paid out to the victims of auto collisions.

We will be starting 2021 with a new Finance Minister. This is an opportunity for Peter Bethlenfalvy to bring new accountability to the auto insurance sector.

 

Kristian Bonn

Personal Injury Lawyer

Bonn Law