Provincial regulator approves auto insurance rate increase

Hike comes despite hints of "transformative change"

Despite a provincial budget promising auto insurance industry reforms, Ontario’s insurance regulator has approved a series of rate hikes.

The rate increases affect 21 insurance companies in Ontario, representing some 40% of the province’s motorists. The Financial Services Regulatory Authority approved the move, which could lead to customers’ premiums going up by about 1.6 per cent across the market.

Related: Provincial Budget Aims to Tackle Deficit

Ontario is among the most expensive provinces in which to insure a car. During the presentation of his budget last year, then Finance Minister Vic Fedelli said the provincial insurance industry is broken and Ontarians deserved “transformative change”. Ontario’s no-fault insurance system is fraught with fraudulent claims, costing the industry about $1.3 billion annually.