Last week, the government of Ontario announced that it would be amending some regulations on insurance premium rebates, in turn allowing auto insurance companies to more easily provide financial relief to customers during the COVID-19 pandemic. The Canadian Press reported that this change will mean insurers can offer premium rebates for up to 12 months after the emergency has ended.
Before this announcement, some Canadian insurers had already moved to offer customers premium adjustments and rebates based on less driving during the outbreak. These included Intact Financial, Allstate Canada, Aviva Canada, La Capitale, and Desjardins.
In response, the Insurance Bureau of Canada (IBC) said that the provincial government’s announcement reinforces these moves made by insurers “to help alleviate some of the financial burden for the most vulnerable.”
“We recognize that many drivers are no longer commuting or using their vehicle as regularly and their premiums should reflect the reduced risk. IBC expects this offer could initially result in $600 million in savings to consumers across Canada – more than half of that in Ontario alone,” explained Steve Kee, IBC’s director of external communications.
Besides adjusting premiums for drivers, IBC member companies have also committed to several other measures to help Canadians, according to Kee. They include:
- Exploring flexible payment options for consumers who are in a vulnerable position or facing financial hardship as a result of COVID-19;
- Waiving the NSF fees they would have charged if a driver had insufficient funds to cover their premium, though the insured remains responsible for any fees their bank may charge them; and
- If the policyholder is temporarily using their car or home differently (such as for commuting to work instead of taking public transit, or they may be working from home) it will not affect their premium or ability to make a claim.
Kee noted, “These measures will continue for the next 90 days. Insurance customers whose driving habits have changed significantly or who are facing financial hardship as a result of the pandemic should contact their insurance representative. We look forward to working with government to support Ontarians.”