IBC Pushes for More Auto Insurance Reform in Ontario

Forgeron calls for "balance" between premiums and benefits

In the wake of the Ontario Liberals’ surprise majority victory last week, the head of the Insurance Bureau of Canada is pushing for Premier Kathleen Wynne to bring “balance” to the province’s auto insurance industry.

In a speech before the Economic Club of Canada, Don Forgeron applauded the premier’s previous efforts to rein in insurance costs, including a pledge last year to bring premiums down by 15 percent—and added that as the Liberals return to government, “IBC will be looking for actions that address not just benefits and premiums, but the system itself and the cost of bringing it to the marketplace.”

Forgeron acknowledged that consumers’ top priority in the province is lower premiums: after a video montage of Ontario drivers complaining about high premiums, Forgeron joked, “I could probably just stop there.

He said, however, that premium reductions could not happen in a vacuum—that the most important thing was to bring balance between premiums and benefits to the industry.

Forgeron said that if some systemic issues were fixed and the costs lowered, “premium reductions for drivers will logically follow.”

Forgeron specifically praised Bill 171—government legislation that died on the order paper when the election was called—for addressing some of the factors that have driven up premiums. These factors include the towing system, a “broken” dispute resolution system, and “fraud and abuse” among some in the auto insurance system.

“With Bill 171 gone,” Forgeron said, “these reforms… will have to be re-introduced.”

Forgeron, a former IBC vice-president for Atlantic Canada, said that Ontario could learn from previous successes in Nova Scotia and Prince Edward Island, where governments have sought to reform auto insurance over the past 15 years.

“That steady process paid off and today we have stability and affordability in auto insurance in these provinces,” he said.

Though Forgeron was light on details, he said that the IBC would be looking at how to crack down on fraud and abuse and “provide meaningful incentives for safe driving,” among other priorities.

Forgeron added that this plan would be fleshed out in the fall.

Follow us on Twitter at @CITopBroker for the latest industry news.

Copyright © 2018 Transcontinental Media G.P.
Transcontinental Media G.P.