Ontario
blames backlog for delay in auto insurance cuts: Rates will take effect three
months late |
TORONTO
- The Ontario government is defending a delay in cutting auto insurance rates,
blaming an administrative backlog in processing insurance company rate filings. |
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The Liberals said yesterday all
new rates will be approved by July 15 -- three months after the April 15 date
they initially set for lower rates to take effect. |
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"It will take some time
for people to see those, but already as of April 15 people are seeing decreases
in their rates, and we're continuing to work to bring in other reforms so we
can continue to see rates go down," said Diane Flanagan, spokeswoman for
Finance Minister Greg Sorbara, who is on vacation. |
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When the Ontario government was
sworn in last Oct. 23, Premier Dalton McGuinty immediately froze insurance
rates for 90 days, promising that rates would fall on average by 10 per cent
when insurers filed new rates on Jan. 23 as the government required. |
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But that was the first time all
of the province's 61 insurance companies filed rate changes at once, which
resulted in a mass of paperwork, and many of the filings were complex, Ms.
Flanagan said. |
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More staff were hired through
an actuarial firm to process the documents, she added. |
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Rate decreases averaging about
10 per cent were approved April 15 by the government for firms representing 55
per cent of Ontario's auto insurance market. |
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However, the remaining 45 per
cent of the market won't get approval to drop rates until July 15. Approval
must be granted before customers of those companies see rate decreases, and
only when they get their renewals. |
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Not all consumers will see
lower rates. Some rate hikes were already approved last September by the previous
Tory government, and any rate cuts would be applied to those earlier increases,
Ms. Flanagan said. |
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"People are very
frustrated," said Mark Arsenault, director of public and government
affairs at the Canadian Automobile Association. |
"What's happening is some
people might not see a rate decrease for a year or longer period depending on
when the company's decrease was approved and when they submitted for their
insurance renewal."
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