June 15, 2016 by Canadian Underwriter
Only 10% of Ontario’s nearly 10 million drivers report that they are “very knowledgeable” about the elements in a standard auto insurance policy, according to a recent survey commissioned by the Financial Services Commission of Ontario (FSCO).
The survey, released on Wednesday, found that while 75% of Ontarians who have auto insurance state that they are familiar with the benefits and coverages in their auto insurance policy, only 10% are very knowledgeable about the elements in a standard auto policy. The online survey, conducted by EKOS Research Associates in April, was completed by 1,159 Ontarians with a current auto insurance policy. The margin of error is +/- 2.9 percentage points, 19 times out of 20.
The study found that 82% of respondents state that collision coverage is included in a standard auto policy, when in fact it is an extra coverage that must be purchased, FSCO noted in a press release. In addition, of those who indicate they were “very familiar” with the benefits and coverages in their policy, only 37% knew that medical, rehabilitation and attendant care – one of the key benefits in Ontario – was included.
On June 1, new auto insurance reforms took effect, including some reductions to benefits and coverages, as well as options to give consumers more choice and greater flexibility, FSCO noted. The reforms make it “more important than ever that drivers understand how their policy protects them in the event of an accident,” FSCO said, noting that Ontario drivers will receive detailed information about the changes with their renewal package. They are encouraged to call their insurance representative to learn more and read their policy carefully before renewing.
“Understanding your policy is the first step towards making sure you are protected if you are ever in an accident,” said Tom Golfetto, executive director of FSCO’s Automobile Insurance Division, in the release. “There are many options that allow Ontarians to tailor their coverage to meet their needs, but drivers need to take a more active role in learning about their policy and making educated and informed decisions.”
Another survey, conducted on behalf the Insurance Brokers Association of Ontario (IBAO) just before the reforms came into place, found that only four in 10 respondents reported that they were aware of the changes.
Based on feedback from 1,000 Ontarians, the survey undertaken by Bond Brand Loyalty on behalf of IBAO considered consumer views on both home and auto insurance. A total of 42% of consumer polled were aware of the changes and less than one in five could cite specific changes within the legislation, the study found.
Rates/premiums were rated as the most important feature of an auto policy by 54% of respondents, followed by the amount of coverage (23%), service (10%), deductible (5%), insurance provider (4%), and broker (3%).