Get ready to pay less for insurance if you have winter tires in Ontario

Andreas Rentz / Getty Images

TORONTO – Ontario drivers will be getting a discount on their car insurance if they have winter tires once the 2015 Ontario budget passes.

But some drivers should also expect higher deductibles and less rehab coverage after an accident.

The move is part of the government’s 2013 promise to cut auto insurance costs by 15 per cent by this year. That pledge has been half realized, the ruling Liberals say, with average insurance rates down by roughly seven per cent – yet still well short of their initial deadline of this August.

Winter tire discount

The government will require insurance companies to give discounts for winter tires, but how much that discount will be is still up in the air and subject to consultation.

A handful of companies already give discounts that range from 3 to 5 per cent, but the Ontario budget doesn’t identify whether that same discount will be mandated on all auto insurers.
The government is not, however, looking at mimicking Quebec’s mandated winter tires.

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“Ontario will continue to be the most generous and we’re going to find ways to reduce those rates because we’re reducing the cost of claims and by reducing the cost of claims, we’re modifying some of the coverage without sacrificing protection,” Finance Minister Charles Sousa said Thursday.

But NDP leader Andrea Horwath said Thursday that drivers will pay more and get less.

“It’s a big of a shell game isn’t it? What we want is lower auto insurance rates but still with a robust product and I think that’s where we’re going to see Ontarians get ripped off once again,” she said.

Sousa suggested attempts to lower the cost of claims, combat fraud, and expedite dispute resolution would work to lower the cost of insurance.

But while insurance rates may fall, there will be changes to the deductibles and benefits. The standard deductible on comprehensive coverage will increase from $300 to $500, meaning if you’re in an accident, you can expect to pay a bit more.

The Ontario government is also cutting the overall funding for benefits after accidents so it is closer to, but still higher than, national averages.

Accident victims had been able to dip into two pools of funds for rehab; $50,000 for medical and rehabilitation services and $36,000 for attendant services. Now, the government is combining those and moving the funding limit to $65,000, less overall, but more for each one in isolation.

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The changes also reduce the amount of time everyone except children can claim benefits from 10 years to five years.

The government did not set a timeline for when the changes would go into effect.

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