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Ontario drivers with winter tires soon eligible for insurance discount


October 14, 2015   by Canadian Underwriter


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Ontario’s Ministry of Finance announced on Wednesday that the province is “moving forward with its plan to help lower auto insurance rates” by requiring all provincial insurance companies to provide a discount for drivers who buy and install winter tires, starting Jan. 1, 2016.

Winter tires that are in good condition can shorten braking distances by as much as 25%, said Ontario’s Ministry of Finance

“Individual insurers will determine the amount of the discount they offer and what documentation, if any, they require from drivers to verify their use of winter tires,” the ministry said in a backgrounder, adding that about 45% of insurers already offer some form of a winter tire discount.

Drivers who are renewing their policy before Jan. 1, 2016 and who install tires should shop around for the best possible rates and the coverage that fits their needs, the backgrounder suggested. Drivers who install winter tires and whose policy renewal is after Jan. 1, 2016 should call their insurer to inquire about a possible mid-term discount on their auto insurance premiums.

Minister of Finance Charles Sousa made the announcement at a Canadian Tire in Toronto, where he participated in a demonstration showcasing the benefits of using winter tires to enhance safety in winter driving conditions.

Related: David Marshall to serve as advisor on auto reforms to Ontario’s finance minister

Winter tires enhance safety and reduce the likelihood of collisions by improving traction, braking and handling in frost, snow, slush and under cold and icy conditions, the ministry said in a statement. Winter tires that are in good condition can shorten braking distances by as much as 25%, the ministry said.

When buying these tires, Ontario is also reminding drivers to:

• Look for tires marked with a logo of a peaked mountain with a snowflake;

• Install the tires in sets of four;

• Do not mix tires with different tread patterns or size;

• Change tires that are worn close to the tread-wear indicators; and

• Check the tires’ air pressure at least once a month

Over the last two years, the government has introduced a number of “important and necessary reforms” to Ontario’s auto insurance system to reduce costs and lower the premiums of the province’s more than 9.5 million drivers. In order to continue achieving rate reductions, the government outlined a series of further initiatives in the 2015 Budget, including bringing costs more in line with other provinces and providing Ontario consumers with more choice in purchasing auto insurance to suit their needs.

Related: Ontario ‘will remove excessive costs’ from auto insurance with reforms announced in budget: Insurance Bureau of Canada

Starting June 1, 2016:

• The maximum interest rate that an insurer may charge for monthly auto insurance premium payments will be lowered to 1.3% from 3%;

• Premium increases for certain minor at-fault accidents will be prohibited; and

• Consumers will have the option to purchase enhanced optional accident benefits, should they desire additional coverage.

“Our government is committed to reducing insurance costs and lowering premiums after recently introducing important and necessary reforms to the auto insurance system,” Sousa said in the statement. “Auto insurance is dependent on individual drivers’ behaviour, and this winter season, drivers across Ontario will be able to save more on their auto insurance by installing winter tires.”


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