In a recent blog post, we discussed how many people view auto insurance to be much too high.
In a recent CBC news article, the Ontario government has announced that they will lobby insurance companies in an attempt to convince them to charge lower insurance premiums to those drivers who have snow tires installed on their cars.
Ontario currently has one of the highest auto insurance premiums in North America. While it is not immediately certain how much drivers will ultimately save, the snow tire pitch hopes to bring Ontario auto insurance costs in line with other provinces by making regulatory changes.
In this proposal, the government hopes to:
- Stop insurers from automatically increasing the premium for drivers involved in minor, at-fault accidents;
- Limit the maximum interest rate that drivers pay on monthly auto insurance premium payments to 1.3 per cent, down from three per cent today;
- Establish a $300 standard deductible for comprehensive coverage, as opposed to $500 — a level where it has otherwise stood for some time in Ontario;
- Combine medical and rehabilitation benefits with attendant care services as a single benefit set at $65,000; and
- Combine services as a single benefit with a limit of $1 million in the event of catastrophic accidents. Drivers will be able to pay more for coverage up to $2 million.
The government says that it is committed to collaborating with the insurance industry to implement these proposed changes.
From a legal standpoint, if a driver gets snow tires installed on their car, this means that he or she has taken all reasonably foreseeable steps necessary in order to avoid a potential accident caused by skidding. This makes insurance companies happy, because when drivers take the necessary precautions, this presumably lowers the total number of car accidents and thus reduces the overall amount that the insurers will have to pay in compensation for said accidents.
Insurance companies like insuring low-risk consumers. That said, car accidents depend upon a number of factors, including the speed of the vehicle and weather at the time of accident, so insurance companies will not necessarily get off scot-free in the event of a winter car accident.