Renewing your auto insurance in Ontario is perhaps one of the most dreaded times of the year. You’re almost sure that your premium is going to increase. And… when your teen gets their driving license, any happiness about not having to chauffeur them around anymore is quickly overshadowed by the extra thousand or so you will now have to cough up for several years. If you have the misfortune of having more than one teen (or new driver) on your family insurance, it’s like paying a mini mortgage. You wonder why you insisted they learn to drive in the first place!
You may do your due diligence and shop around for lower rates but in the end difference is almost negligible. All those hours spent getting online quotes and answering the same questions while on the phone with different agents helped you save a few pennies. On the rare chance, you find a good deal, expect to catch up to the higher rates you came across with each renewal. This has been my experience over the years.
The recent Allstate report that Mississauga (my city of residence) is one of the least safe cities to drive in brought more bad news—my insurance rates are likely to rise again.
Anyone with a basic knowledge of how insurance works understands that rates are tied to risk levels. The higher the liability meaning the claims, the higher the cost. Brampton drivers, for instance, have borne the brunt of living in a city with the highest premiums in Ontario (according to Kanetix). Friends who have moved here from other cities immediately noticed the significant jump in their auto insurance rates. Now those in Mississauga and Caledon will share their pain.
That the province is looking to crack down on insurance fraud in order to lower rates should not come as a surprise to many Ontarians. Those living in the immigrant-rich areas of the GTA where insurance fraud has become a popular means of generating additional income are all to familiar with this scenario. (Pardon the cliché, but there is a striking coincidence.)
It would be interesting to see how the provincial government expects to tackle this problem. A huge nexus involving auto drivers, tow truck operators, lawyers, collision centres and medical practitioners (like chiropractors and physiotherapists) has been milking the system for years.
Take the case of a friend whose sedan was involved in a collision with a local transit bus. A casual conversation about his experience during a massage led to clinic staff encouraging him to press for compensation in the form of paid treatment. He had no symptoms of whiplash or any other injury from the minor collision but was advised to advocate for benefits ‘just in case’. Something that the clinic would also benefit from. Tempted by the thought of extra dollars in his purse, he proceeded to fill out forms given to him by the clinic. However, questions about his credit history (not sure how this is relevant) during the insurance inquiry led him to abandon the venture. His finances were in bad shape at that time.
After listening to his story, I realized how easily the transaction might have gone through. No doubt the clinic had plenty of experience and the resources to help him make the case. While he added to his bank account, the insurance company would have passed on the rising costs to its subscribers the following year.
The story is no different when it comes to health insurance with clinics whose main business is to process these fraudulent claims.
All this comes with a price and the big one we are paying for auto insurance in Ontario which is one of the highest in the country.
Don’t be surprised if your employer reduces your health coverage or ask you to contribute a higher amount towards it next. Misusing benefits like making fraudulent claims to cash them out will lead us in the same direction as the auto insurance scenario.
Many choose to ignore this and cash in while they can. Unfortunately, all of us will be paying for it sooner than later.
It is time we understood that nothing is free! – CINEWS