Changes are coming to auto insurance policies in Ontario. Here's what you need to know
Ontario makes several previously mandatory auto insurance benefits optional as of July, potentially lowering premiums.
As of July, some benefits that were previously mandatory under standard car insurance policies will be optional. This could drop the cost of premiums for customers who opt out of certain coverages, but insurance experts warn against leaving coverage exposed to risk.
The province’s mandatory accident benefits are getting an overhaul on July 1
The audio version of this article is generated by AI-based technology. Mispronunciations can occur. We are working with our partners to continually review and improve the results.
Everything you need to know about Ontario's auto insurance changes
As part of new Ontario auto insurance rules which take effect July 1, drivers will be able to opt out of some accident benefits that were previously included in standard coverage. CBC's Mercedes Gaztambide breaks down what drivers need to know.
Auto insurance premiums could go down this summer — but at the cost of many people's coverage.
As of Wednesday July 1, Ontario is changing what is considered mandatory under accident benefits — coverage that is embedded within standard insurance policies. This will offer drivers more flexibility over what they're paying for, though some experts say it leaves more drivers vulnerable, and may not have a large impact on overall premiums.
Lance Miller, insurance broker and CEO of Surex Insurance, says the average customer can save $100-200 annually on insurance by opting for the most basic coverage, but says the draw of lower premiums may not be worth the savings when disaster strikes.
"If you opt out of funeral expenses, maybe that is going to be a $30-50 charge annually," said Miller. "But if there's a funeral, those cost tens of thousands of dollars."
The change comes after a 2022 report by the province’s auditor general, which found Ontarians were paying the highest auto insurance rates in the country.
As a result, Doug Ford's 2022 election campaign featured a promise of changes that over time would provide consumers with more options when purchasing automobile insurance.
Auto insurance changes coming in Ontario budget: sources
Car insurance costs to rise in 2024 thanks to inflation, rampant auto thefts: report
Previously, income replacement, lost educational expenses, death benefits, funeral expenses and more were automatically covered, but as of July they will become optional. The updated mandatory benefits will be stripped down to only include medical care, rehabilitation and attendant care benefits.
Miller said this means the onus now falls on consumers and their insurance brokers to understand which optional benefits they are giving up. "I think it's going to require a shift in the consumer's mind to not be focused directly on what's the cheapest auto insurance," he said.
"It's going to be: ‘What really covers me and how do I find what I really need to cover myself at the best price?'"
For those with an existing auto-insurance policy, coverage stays the same — the July 1 change will only apply to new or updated policies. The province had directed insurance brokers to contact their customers and give them the option to adjust their policies.