NDP Fights IBC Over Car Insurance Rates

By: Gary Parkinson on February 6, 2013

A face-off over car insurance is underway in Ontario as the government prepares to return to Queen’s Park after an extended break.  NDP Leader Andrea Horwath has demanded the governing Liberals support her party’s motion to reduce car insurance rates by 15 percent.  However, IBC Ontario says car insurance fraud has cost the industry billions of dollars, and asks all political parties to work on finding a solution instead of playing politics.

Horwath says Ontarians are forced to pay for coverage to legally drive their cars, and despite the industry announcing profits last year, drivers are still paying more money for coverage.

In fact, in 2011 the value of statutory accident payouts fell by just under $2 billion, an astonishing 50 per cent reduction from 2010, but that same year Ontario’s auto insurance rates still increased by 5 per cent.”

The NDP challenged the IBC in December regarding this very issue, and Horwath has made the fight central to her policy in this upcoming session of government.  However, IBC Ontario Vice President Pete Karageorgos – who was dismissive of the NDP two months ago – accuses Horwath of trying to score political points.

“The NDP’s math has always been wonky to begin with.  I don’t think she has thought it through.”

Karageorgos says car insurance fraud has run rampant across the province over the last few years, and increases the cost of insuring all drivers.  He says there were approximately $1.5 billion worth of fraudulent claims during 2011, costing every driver in Ontario an average $236 extra on their car insurance premiums. 

The IBC says the NDP should demand that Premier Wynne implement the anti-fraud task force report issued in November, which makes recommendations to reduce car insurance fraud and the costs associated with falsified claims.  Karageorgos says he agrees that car insurance rates are too expensive, but firmly believes premiums will come down when costs are reduced – and that reducing car insurance fraud must be a priority for Ontario.