Province Announces Sweeping Changes to Auto Insurance

April 12, 2019, Kitchener, Ontario

Posted by: Robert Deutschmann, Personal Injury Lawyer

The Provincial Government released their budget yesterday and announced ‘Transformative Auto Insurance’ reforms but have provided little information on how much drivers will save, and how much injured people may lose in benefits. What is clear is that this is a wide scale plan aimed at reducing insurance rates for drivers. No targets were released as to how much they will drop. The changes seem to be aimed at making the insurance claim process easier for claimants in the event of car accidents and personal injury. The government hopes to create more competition between insurance companies as well.

It is clear that the auto insurance system in Ontario is broken. Drivers pay much more than anywhere else in Canada, and the deductibles are high. Payouts for injured drivers can be low, and often the base coverage offered by insurers is not adequate in the event of serious and catastrophic injury. I have written about this in the past.

Proposed changes will allow drivers to pick and chose coverage which may be beneficial for educated consumers. Insurance companies will also be allowed to offer a variety of new discounts to drivers – these could include things like drivers agreeing service provision from ‘preferred providers’ for personal injuries or auto repair, or for agreeing to credit checks.  Companies won’t be forced to offer these discounts though.

A radical change proposed is the Driver Care Card which is proposed to be a form of debit card for claimants. The proposal is that following an accident the card is loaded with money which is then earmarked to pay for personal injury treatment like rehab and physiotherapy. Minister Fedeli said the card will "streamline access to care by providing important information that will make the claims process easier to navigate."

It’s hoped that by stimulating competition between insurers companies will lower their premiums and give drivers the coverage they want with overall lower rates. Postal code discrimination will also be ended. This allowed insurance companies to charge higher premiums for people living in high claims areas.

Time will tell if these changes improve the system for drivers, and provide the protections they need when they are injured in a car accident.

The chapter of the 2019 Ontario Budget called “Protecting What Matters Most” deals with auto Insurance. It’s called a Blueprint for Ontario’s Auto Insurance System. I’ve attached the full chapter below or you can read it online here.


Over the past 30 years, Ontario’s auto insurance system has gone through a series of ineffective patchwork reforms implemented by different governments. After each reform, costs came down temporarily, only to rise again. Auto insurance rates in Ontario are now higher than they were a decade ago and have been among the highest in the country since 2013.   Ontario drivers deserve better. This is why Ontario’s Government for the People is going to invest the time and effort required to implement an effective, sustainable auto insurance system that actually puts drivers first. In contrast to the ineffective changes that were brought forward by the previous government, this government will take the time to get it right for the benefit of all Ontario drivers. Every driver in Ontario recognizes the need to carry auto insurance. At the same time, many drivers are left frustrated and confused by an expensive and convoluted auto insurance system in which the rates they are required to pay seemingly fail to reflect their driving record or individual needs. And during those unfortunate times when drivers do need to make an insurance claim, they are left at the mercy of a system that often seems to cater to lawyers or insurance companies, rather than to the victims it is supposed to help. LISTENING TO THE PEOPLE “We commend the government’s recent auto insurance consultation asking drivers to provide feedback on their insurance needs, and with the government’s stated commitment to review how auto insurance rates are regulated. We agree that reducing costs from the system requires a focus on initiatives that will reduce red tape, address road safety, and combat escalating claims costs. We stress that changes to territory segmentation alone will not resolve the cost challenge for Ontario drivers. We must remove costs from the system. Reduced costs will ultimately result in savings that will be passed on to consumers.” George Hardy, Viceâ€President, Home and Auto Insurance,

Lowering Costs and Fighting Fraud

The government made a commitment to work for families and to respect their hardâ€earned dollars. Auto insurance should be affordable, easy to understand and easy to buy. The blueprint focuses on lowering costs, finding efficiencies and fighting fraud to ensure that drivers’ auto insurance premiums pay for the health care services they need after an accident, rather than for costly and unnecessary disputes.   The government will work with the Financial Services Regulatory Authority of Ontario (FSRA), a new, independent financial regulator, to:

  • Overhaul the licensing system for health service providers to reduce regulatory burden and fraud, including lowering the treatment fees charged by providers; and reform the flawed medical assessment process to bring credibility and accountability to the assessments that injured claimants must undergo after an accident. The government will also work with the Law Society of Ontario to make contingency fee agreements more transparent for injured claimants who choose to hire a lawyer. As part of this work, the Province will evaluate the effectiveness of the current contingency fee arrangements to ensure consumers are being fully protected.   Insurance fraud is estimated to cost Ontario consumers billions of dollars each year. The government’s Putting Drivers First blueprint will focus on combatting fraud so that honest drivers do not have to pay for the dishonest actions of fraudsters. The government will work with FSRA and the newly established Serious Fraud Office to develop a fraud reduction strategy and modernize the systems that improve the delivery of health care benefits, including:
  • Strong antiâ€fraud measures, such as enhanced data analytics to detect fraud, and new rules on unfair or deceptive acts or practices; and a modern online claims process that lets consumers see how their auto accident benefits are being used, to make the claims process more convenient and help detect and discourage fraud. Section B: Putting People First


The Putting Drivers First blueprint is a transformational, multiâ€year strategy. The government recognizes that consumers need change to happen now and is taking early action to make the consumer insurance experience easier and more convenient. These changes include:

  • Facilitating electronic communications through proposed amendments to the Insurance Act and the Compulsory Automobile Insurance Act, making it fast and simple to do business with insurance companies;
  • Bringing the convenience of electronic proof of auto insurance to Ontario drivers;  
  • Enabling innovation and new business models to give drivers more options, such as car subscription services that include insurance; and
  • Making it easier for insurance companies to offer more discounts and options to consumers. Increasing Accessibility and Affordability Ontario’s drivers should have more choice when deciding which auto insurance coverage suits their needs.

They also deserve to have the same convenience that they have come to expect from modern financial institutions, such as banks and credit unions.   The government’s Putting Drivers First blueprint will give auto insurance companies the flexibility to offer drivers more choices in terms of discounts and coverage options to make their insurance policy more affordable. For example, drivers should have the choice to lower their premiums by allowing insurers to consider their credit history, or by agreeing to use preferred providers of auto repair or health care services.   To make the consumer insurance experience simpler, the government is introducing legislation that, if passed, would allow insurance companies to use electronic communications and electronic commerce to do business with their customers. Ontario drivers will soon be able to use an electronic proof of auto insurance, allowing them to benefit from the same ease and convenience already offered in many other North American jurisdictions. Auto insurance forms, policies and other related documents will also be simplified so that drivers will find it easier to understand the coverage they need and make informed decisions about what they are buying. Chapter 1: A Plan for the People 80 Adopting the Driver Care Plan People hurt in auto collisions are too often not receiving timely access to care, and they find it difficult to navigate the claims process and understand the benefits available to them. They can take longer than they should to recover from their injuries because of disputes over benefits and appropriate treatment. The government is putting drivers first by focusing on care for people injured in collisions and making sure that they can access treatment faster. The Driver Care Plan will ensure that injured claimants receive quick access to treatment and care. The Plan will include:

  • A Driver Care Card, which will streamline access to care by providing important information that will make the claim process easier to navigate;  
  • A “Care, Not Cash” default clause to ensure that a driver’s auto insurance coverage will pay for treatment instead of costly legal fees while giving the driver the option to be eligible to receive cash settlements if they so choose;
  • An improved early treatment system for common injuries, including mental health treatment; and
  • A return to the default benefit limit of $2 million for those who are catastrophically injured in an accident, after it was previously reduced to $1 million in 2016. Increasing Competition

A competitive auto insurance market benefits consumers. Making Ontario open for business is one of the government’s key commitments. Ensuring that businesses can compete while encouraging new companies to enter Ontario’s auto insurance marketplace is a key element of the government’s blueprint for the province’s auto insurance system. The government will encourage innovation and reduce the regulatory burden, enabling insurance companies to better serve their customers and invest in Ontario.   The government is working with FSRA to achieve these innovation and modernization goals by:  

  • Supporting innovative business models, pricing structures and technologies, such as payâ€asâ€youâ€go insurance;  
  • Reducing the regulatory burden by improving the way auto insurance rates are regulated;  
  • Reviewing guidelines, bulletins and forms to remove the burden and simplify processes;
  • Eliminating red tape by repealing outdated and ineffective legislation and simplifying regulations such as the Statutory Accident Benefits Schedule; and
  • Working with the Civil Rules Committee to increase the monetary limit for simplified procedures, and reduce the costly and timeâ€consuming use of civil juries for simplified procedure trials.  

Section B: Putting People First 81

The Putting Drivers First blueprint will address key issues identified in David Marshall’s 2017 report on Ontario’s auto insurance system. It will improve choice and convenience for consumers and give them more control over their auto insurance rates and coverage. It will also combat fraud and increase competition, resulting in lower system costs to ensure that Ontario families' hardâ€earned dollars pay for the care accident victims need, when they need it.


Under the leadership of the Member of Provincial Parliament for Milton, Mr. Parm Gill, the Ending Discrimination in Automobile Insurance Act, 2018 was introduced. If passed, this proposed legislation would end the unfair practice of discriminating against drivers based on where they live.

Posted under Accident Benefit News, Car Accidents, Personal Injury

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Deutschmann Law serves South-Western Ontario with offices in Kitchener-Waterloo, Cambridge, Woodstock, Brantford, Stratford and Ayr. The law practice of Robert Deutschmann focuses almost exclusively in personal injury and disability insurance matters. For more information, please visit or call us toll-free at 1-866-414-4878.

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