Regulatory Changes Open the Door for Auto Insurance Rebates
“My message to insurance companies has been clear: they should provide relief that reflects the financial hardships their dedicated customers are facing due to the COVID-19 outbreak.” – Ontario Finance Minister Rod Phillips
News from Ontario’s Ministry of Finance
Posted April 16th, 2020 on Niagara At Large
TORONTO — The Ontario government is enabling auto insurance companies to provide temporary insurance premium rebates to drivers during the COVID-19 pandemic. The province has amended a regulation under the Insurance Act to help ease the financial pressure on working people and families during this public health crisis.
By amending this regulation insurance companies would be able to provide auto insurance premium rebates to consumers for up to 12 months after the declared emergency has ended.
“We are in an unprecedented time and people are experiencing extraordinary financial pressures,” said Rod Phillips, Minister of Finance. “My message to insurance companies has been clear: they should provide relief that reflects the financial hardships their dedicated customers are facing due to the COVID-19 outbreak.”
“All of us will remember how companies treat us during these unprecedented times. I often remind business leaders that their customers from the past five years are likely to be their customers for the next five years,” said Phillips.
“Insurance companies indicated that the regulation preventing rebates was a barrier to providing relief to their customers. That barrier has now been removed so auto insurance companies can step up and do the right thing for the people and families of Ontario.”
The Government and the Financial Services Regulatory Authority of Ontario (FSRA) will continue to work together to monitor how the auto insurance sector is responding.
- Ontario is the first jurisdiction in Canada to remove existing restrictions on rebating so auto insurers can provide additional consumer relief.
- The rebating prohibition is designed to protect consumers from being misled in purchasing decisions based on a rebate and to provide consumer protection from insurers who may discriminate between consumers.
- Auto insurance policy terms generally last for 12 months. The 12-month time period of this regulation would allow insurers to provide rebates to all policyholders, regardless of their annual policy renewal date.
- The Financial Services Regulatory Authority of Ontario (FSRA) is an independent regulatory agency designed to improve consumer and pension plan beneficiary protections in Ontario. FSRA is responsible for monitoring compliance with and enforcing the Insurance Act and its regulations.
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