Home Car insurance prices Auto Insurance Prices Rise Despite COVID-19 Relief Measures, New Report From LowestRates.ca Says

Auto Insurance Prices Rise Despite COVID-19 Relief Measures, New Report From LowestRates.ca Says

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As prices have increased in Alberta and the Atlantic provinces, they decreased slightly in Ontario. The good news is that the report finds that many Canadians can save on auto insurance by actively updating their driving information and comparing rates online. For some, the savings could run into the hundreds of dollars a year.

“Drivers need to ensure that their insurance policy accurately reflects their automobile use, which may have declined dramatically during the pandemic and may remain so as working from home becomes mainstream,” said Justin thouin, CEO of LowestRates.ca. “Drivers may also reconsider the need for comprehensive or anti-collision coverage on older vehicles that might not be worth repairing. But even when insurance rates go up, buying a better deal can pay off. “

The Auto Insurance Price Index Report 2020 is based on data from LowestRates.ca auto insurance quote, which millions of Canadians use each year to compare real-time fares that are right for them. The report focuses on data collected since the start of 2019 from drivers of Alberta, Ontario and the Atlantic provinces, which together represent the majority of from Canada private automobile insurance market. The index was set at 100 in the first quarter of 2019; a one point change on the index represents a change of 1% from the original benchmark of 100.

Highlights of the report:

  • Auto insurance prices have increased in Alberta and Atlantic Canada, while prices have fallen in Ontario (year / year)
  • COVID-19 discounts were not enough to offset rising auto insurance prices (quarter / quarter)
  • Insurance companies through Canada continue to worry about rising claims costs
  • Distracted driving and more technologically complex cars lead to increased claims costs
  • Insurance companies also blame government regulations and price caps for the higher insurance prices. Insurers say caps hurt competition and drive up prices for consumers

that of Alberta price caps – but for how long?







One-year premium change, until Q2-2020




Globally

Men

Women

18-24

25-44

45-79

+ 22.7%

+ 22.2%

+ 22.5%

+ 23.9%

+ 28.7%

+ 19.9%

Car insurance rates in Alberta increased by 23% year over year on average and almost 29% among drivers aged 25 to 44.

That being said, the price increase slowed down in the last quarter. Prices only increased 1% in Q2 compared to Q1. Perhaps sensing increasing pressure on consumer finances due to COVID and low oil prices, only a few insurers have asked that of Alberta insurance regulator for permission to increase rates. Many drivers also reported lower than normal mileage or refused optional coverage (such as a collision) when requesting quotes through LowestRates.ca, likely a byproduct of reduced driving due to lockout. COVID-19.

Sadly, this respite is unlikely to last any longer: Claim costs rise as insurers barely begin to recover from years of austere rate caps that were previously imposed by the government.

Ontario rates are reversing – a sign of things to come?

Ontario

One-year premium change, until Q2-2020

Globally

Men

Women

18-24

25-44

45-79

-3.7%

-3.8%

-4.2%

-1.1%

+ 4.2%

-4.0%

Car insurance rates in Ontario were down about 4% year over year, but saw a 2% increase quarter over quarter, which is worth watching.

This is an unfortunate turnaround in a province where auto insurance premiums are among the highest in the country. A sin Alberta, claims costs in Ontario are rising steadily and insurance companies are clawing back at the previous Liberal government’s attempt to cut rates by 15%. Other factors include from ontario high incidence of insurance fraud and laws allowing some injured parties to sue for damages, with insurers footing the bill.

COVID itself is suspected of driving up prices in Ontario. Countless commuters have abandoned public transit in favor of private transportation, which has increased auto sales and the demand for insurance coverage. But drivers with a long interruption in their auto insurance history or no history at all – who represented 29.7% of LowestRates.ca users in the second quarter – typically pay more for coverage than current or recent drivers.

Ontario drivers should expect insurance rates to stay high over the long term.

“Reduce auto insurance rates by Ontario is going to require a systemic change, which the government has promised, but which will take time to implement, ”said Thouin. “Until then, there is no indication that the Ford government will impose rate cuts or price caps in the same way as its predecessor.”

Atlantic Canada rate up from a year ago despite recent declines

Atlantic Canada





One-year premium change, until Q2-2020



Globally

Men

Women

18-24

25-44

45-79

+ 14.1%

+ 17.6%

+ 5.1%

+ 20.1%

+ 19.6%

-2.3%

Residents of from Canada four Atlantic provinces could breathe a sigh of relief after the first six months of 2020. During this period, the average price of auto insurance fell 8.1%, compared to a jump of 24.2 % in the last six months of 2019. Year over year. , prices are up 14%.

Our data suggests that a large number of older drivers getting quotes on LowestRates.ca have helped drive prices down (insurance companies offer lower prices to older, more experienced drivers as they are considered less risky. to ensure). In the second quarter, the number of LowestRates.ca users aged 45 to 79 increased by 25% from the previous quarter, lowering the average rate displayed on the site.

Unfortunately for drivers, this downward trend is likely to be short-lived. Government policy has forced insurance companies to charge less for auto coverage than they thought possible, leading insurers to be more hesitant to do business in these provinces, limiting consumer choice and increasing consumer choice. prices in the process.

To read the full report, visit: https://www.lowestrates.ca/blog/auto/auto-insurance-price-index-q2-2020.

Our methodology

The LowestRates auto insurance price index tracks the average auto insurance prices. We set the index to 100 in the first quarter of 2019 and use the average prices for that quarter to assess whether prices are rising or falling relative to it.

About RatesLess.ca
LowestRates.ca is an online rate comparison site for insurance, mortgages, loans and credit card rates in Canada. The free, independent service connects consumers directly to financial institutions and suppliers across North America to provide Canadians with a comprehensive list of rates. LowestRates.ca’s mission is to help Canadians become more financially literate, and we’ve spared them over $ 1 billion euros in interest and fees.

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For more information: For media inquiries please contact: Ian Portsmouth, [email protected], 647-641-6033


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