Auto insurance costs likely to go up | Ottawa and Region | News ...

Some Ottawa motorists can expect up to a 7% increase in auto insurance premiums, thanks to soaring costs in payouts for accident health benefits, according to industry officials.

The jump in premiums for Ottawa-area drivers are still lower than the provincial average of 8.5% and the rate hike of nearly 14% for Toronto drivers, said Leonard Sharman, spokesman for the Co-operators General Insurance Co.

The main driver for the premium increases is the ballooning costs from accident health benefits from minor auto accidents, said Dennis Prouse, director of government relations at the Insurance Bureau of Canada.

“This is injuries in auto accidents, it’s not tin and glass and replacement windshields,” said Prouse.

Prouse said the jump in rates serves as a wake-up call for Ontario consumers whose minor fender benders lead to benefits claims of up to $100,000.

“Ontario’s product is the richest and most generous in North America,” said Prouse of relatively minor accidents leading to pricey health assessments for physio, massage therapy and chiropractic treatment.

Ontario’s accident benefits are four times the cost of Manitoba’s and while Alberta drivers pay an average of $1,000 annually for auto insurance — about $300 less than Ontario drivers — Alberta’s average accident benefits costs are $3,000, compared to Ontario’s $38,000 average benefits payout, said Pete Karageorgos, spokesman for State Farm Insurance of Canada.

“When you look at Ontario, our numbers are out of whack compared to other provinces,” said Karageorgos, adding most of State Farm’s Ottawa policyholders will see a 3% drop in rates when their policies are renewed next week.

“The majority of our drivers who are good drivers will see decreases,” said Karageorgos.

Ontario Premier Dalton McGuinty said Tuesday auto insurance rates are still lower now than when the Liberal government was first elected in 2003.

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