Nov 6, 2013 | News
Young Ontario drivers may soon benefit from a new program aimed at cutting vehicle insurance costs for this high risk group.
Ontario parents and their teen drivers could have some relief for the high cost of car insurance, when a variation of a Quebec program by insurer Industrial Alliance comes to Ontario. While it won’t be run by Industrial Alliance, it will be loosely based on its Mobiliz program aimed at 16-to-24-year-old drivers.
The program involves installing a small wireless device in a car’s diagnostic port, designed to measure driving behaviours such as speed, time of travel and distance, hard braking, pace of acceleration and turn speed.
In the past 18 months, the program in Quebec has reduced accident claims by this high risk group by about 40 per cent, allowing Industrial Alliance to reduce the cost these drivers pay for its insurance by an average 23 per cent.
A 20-year-old male insuring his first car typically pays around $3,000 a year in the Greater Toronto Area, so reducing that by $690 is a significant savings.
An application is before the Financial Services Commission of Ontario (FSCO), to launch such a plan. Paul-André Savoie, whose Montreal firm Baseline Telematics is working with a large insurer to launch the program, told the Toronto Star that he hopes to have approval and a product available within three to six months.
“The savings for young drivers will be substantial,” Savoie told the newspaper. “It’s going to be a game changer.”
Savoie’s company developed software that allowed Industrial Alliance to introduce Mobiliz. These telematic products measure how you drive — and the results are available to you and your insurer online.
Suzanne Michaud, a vice president of client services with Industrial Alliance, says the Mobiliz program has exceeded expectations.
“Are we happy? Yes, very much,” she said. The company is a small player in the national auto insurance market and has no plans to bring Mobiliz to Ontario.
Quebec-based Desjardins Insurance introduced a usage-based plan in Ontario last spring. Spokesman Joe Daly says one-third of eligible new customers are trying its Ajusto program and it has 40,000 people in Ontario and Quebec using it.
Daly says the average savings is 12 per cent, though the company says you can earn up to 25 per cent by exceeding all its benchmarks. Unfortunately for many GTA commuters, the scheme penalizes those who drive more than 15,000 kilometres a year. These drivers cannot earn more than a 15 per cent reduction, no matter how well they drive.
Savoie has six projects underway with Ontario insurers, including the one he hopes to see available by the spring. He says insurers are eager to explore the potential of telematics. For example, it can help them target niche markets, whether it is the worst drivers, low mileage drivers or urban vs. rural drivers.
Applying for a Mobiliz policy is easy and quick. The online form asks for your age, gender, postal code and make of car and instantly returns a quote with the monthly payment. Mobiliz price adjustments are made monthly, rather than annually upon renewal. The instant reward is a powerful incentive for young drivers on tight budgets, Savoie says. It pairs good driving with immediate saving.
The use of telematics and usage-based insurance policies is only in its infancy. A recent article on industry website Property Casualty 360 notes that the global market share of usage-based insurance has doubled in the past year. One area where insurers see potential is wearable technology devices that can monitor your heart rate and blood pressure among others.
“Health Insurance companies are starting to take a long look at this type of technology,” says Carole Beatty with SAP Canada.
Excerpted from an article by Adam Mayers in the Toronto Star
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Sep 12, 2013 | News
The Toronto Police Service and insurance company Aviva Canada have released details of a recent insurance scam that has left individuals without auto insurance coverage and cost them hundreds and, in some cases, thousands of dollars.
“With the anonymity and ease of classified websites, we have seen a sharp increase in the amount of fake motor vehicle liability insurance cards, also known as pink slips, being sold online,” said James Russell, Chief Underwriting Officer for Aviva Canada. “Consumers need to be aware that some individuals have made a business out of defrauding others and use this type of scam as a regular source of income.”
On Sept 10, Toronto Police Service officers arrested Serafattin (George) Solak outside of his Edmonton home and he has now been charged with:
- 1 count of Fraud over $5,000
- 13 counts of Fraud under $5,000
- 8 counts of Uttering a Forged Document
- 4 counts of Misleading Receipts
- 8 provincial charges of Sell, Give, Distribute Insurance Card
During the arrest, police officers seized fraudulent Aviva Canada motor vehicle insurance liability cards.
“We want to emphasize that the charges against Mr. Solak are just one instance. Other would-be criminals are trying this over and over again,” said Russell. “What people are buying from these individuals is not insurance – it’s just a piece of paper that comes with a big risk. Any driver using a fake insurance slip instead of securing valid coverage could potentially be sued for millions of dollars.”
The charges were laid by Toronto Police Service after Aviva Canada provided evidence of fraudulent activity. It is alleged that Mr. Solak advertised insurance for sale on various online classified websites including Kijiji and Craigslist. It is also alleged that he met with a number of potential victims in person, accepted cash or cheques and provided false motor vehicle liability insurance cards.
The Financial Services Commission of Ontario has also issued a public warning about Mr. Solak and his connection to a fake insurance scam.
What happens to those who are caught with false insurance?
Having false insurance means a driver has no insurance at all, which is illegal. If it is discovered that a driver has a false auto insurance card, they could be charged with a criminal offence, possibly leading to first-time penalties of:
- A minimum $5,000 fine, up to a maximum of $25,000.
- Vehicle seizure for up to three months, with the owner responsible for all storage costs.
- Driver’s license suspension for up to one year.
- For a second conviction the minimum fines double, and there is the possibility of being charged with a criminal offence.
What happens to those who have false insurance and who are involved in an auto collision?
Those having a false auto insurance card (meaning no valid insurance) and are involved in a vehicle collision:
- Will not be covered for any collision damage to their vehicle.
- Are not eligible to sue anyone else for damage to their vehicle or bodily injury, even if they weren’t at fault.
- Can be sued for damage to the other vehicles involved in, or for bodily injuries that resulted from, the accident and will be held personally liable leading to wage garnishing or property liens.
It is also important to note that if a family member or friend is driving the falsely insured vehicle, they can be charged and/or sued for damages.
What can consumers do to protect themselves?
Be mindful that if a deal seems too good to be true, it likely is.
- Never purchase insurance with cash.
- Call the company listed on the policy to ensure it is valid.
- Never meet in a public place with someone that claims to be an insurance representative. Insurance brokers or insurers will have branded websites and/or an office; they will not likely ask to make a transaction in a public place.
- Remember that even if the motor vehicle liability insurance card looks legitimate, it could still be a fake.
- Report it, report it, report it! If enough consumers alert authorities of this activity, fraudsters will be easier to capture and convict. Call the Insurance Bureau of Canada’s TIPS line at 1.877.IBC.TIPS, the Financial Services Commission of Ontario’s Fraud Hotline www.fsco.gov.on.ca/TipNow or call 1-855-5TIP-NOW, or Crime Stoppers (1-800-222-TIPS).
Excerpted from Newswire.ca.
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Sep 6, 2013 | News
A recent poll from TD Insurance reveals that although 89% of Canadians feel they are ‘somewhat’ or ‘extremely’ likely to know what to do following an auto accident, only 31% know the exact steps to take. In a real-life situation, how prepared would you be to deal with an accident safely and efficiently?
“Fender benders resulting from drivers making sudden stops in intersections, or pulling out of a parking spot without checking first happen every day, so it’s important to be prepared and know what steps to take afterwards,” says Dave Minor, a vice president at TD Insurance. “The actions you take after a minor accident can affect your insurance coverage, so be sure to review the steps with your insurance provider when you renew your policy each year.”
Minor offers the following tips to drivers:
- Keep calm – Being in an accident is stressful, but try not to panic or make rash decisions. Don’t accept money or admit fault for the collision, and don’t agree to just forget about it. Most drivers (87%) say they know not to accept money or accept fault, as this can affect the coverage their insurance company will provide for the incident.
- Safety first – Check to make sure everyone involved is safe. If anyone is injured, do not move them, doing so could worsen their injuries. If you’re able to safely move your vehicle out of the flow of traffic, and protect it from further damage, do so. “Your number one priority after getting into an accident is making sure everyone in the vehicle is safe. Once you’ve established the safety of the passengers, take steps to protect everyone from any additional damage by moving your vehicle out of traffic.”
- Call the police – Call 911 to report the accident if anyone is injured, if you believe that there is major damage to your vehicle, or if you think a criminal act may have been committed.
- Take notes – Include details of the accident and identification of the vehicles and people involved, including emergency personnel or witnesses on scene. If possible, take pictures or video, and/or draw a diagram of the accident scene to assist with documentation of a claim. Keep a notepad, pencil, and a checklist of things to do after a collision in your glove compartment, just in case.
- Call your insurer – Most insurance policies require you to report any accident involving loss or damage to people or property. If you don’t report an accident, it may affect your coverage down the road. If another driver involved reports the accident, their insurance company may contact your insurance provider, which could lead to cancellation or non-renewal of your policy if you have not reported the accident yourself. “Contact your insurance provider as soon as possible to inform them of the accident, not only to cover yourself and your car, but for help with how to handle the situation,” says Minor. “Your insurance provider can confirm all of the information you should be collecting from the other party. They can also offer a list of recommended repair shops in your area that can help with getting your vehicle back in shape even faster. Review your policy before repairs are made to make sure you understand the limitations of your coverage.”
TD Insurance commissioned Environics Research Group to conduct an online custom survey of 2,466 Canadians aged 18 and older, who have driven in the past 12 months. Responses were collected from February 7-18, 2013.
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Aug 26, 2013 | News
Ontario plans to reduce car insurance rates by 15 per cent in the next two years, Finance Minister Charles Sousa announced on Friday.
Reducing auto insurance rates by 15 per cent was a condition set by the NDP when it agreed to support the Ontario budget earlier this year, however the NDP called for the reduction to happen in the first year.
NDP transportation critic Gilles Bisson told the CBC that auto insurance companies have profited by billions from legislation that reduced payouts for personal injuries. He says those savings were never passed on to the consumer.
“That’s why in the budget we said we need 15 per cent. We need it now — it has to be done this year,” he said ahead of the announcement.
Drivers have complained that Ontario car insurance costs are too high, with rates rising rapidly over the past few years even for drivers with 25 years accident free.
Randy Carroll of the Insurance Brokers Association of Ontario welcomes a rate reduction, but says the government must first crack down on insurance fraud, which he said is costing the industry $1.5 billion annually.
“If we get the rates down before the fraud is out of the system it will just put undue pressure on insurers and will end up putting undue pressure on consumers,” he told CBC News.
Auto insurance rates are determined by individual insurers using a combination of factors including driving experience, driving record, use and location of the vehicle, the type of vehicle driven, and amount of coverage and deductibles selected.
But Ontario’s Superintendent of Financial Services reviews rates proposed by every company and the Financial Services Commission of Ontario regulates auto insurance to ensure protection for drivers. The FSCO will likely enforce Ontario’s mandated rate reductions, with rates dropping eight per cent in the first year and an additional seven per cent in the second. Ontario drivers won’t see the new rates kick in until they renew their policies.
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Excerpted from CBC.ca
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