The Ontario Legislature recently passed Bill 15 – The Fighting Fraud and Reducing Automobile Insurance Rates Act. The bill tackles hot button topics in both the auto insurance and auto towing industries, with the intention of protecting and assisting motorists in the long run. For the insurance industry the bill works to reduce insurer costs, allowing for a trickle-down effect to eventually reduce insurance rates for drivers. For tow truck operators the bill will mean new, stricter laws and regulations.
What do drivers need to know about the bill?
Reducing Costs to Insurers
The province aims to reduce costs to insurance companies by making insurance fraud more difficult to commit. This means stricter rules when it comes to claiming benefits, shorter deadlines within which you can make a claim, and a cap on how much of a payout you can receive. While these rules will reduce insurer costs and thus (theoretically) insurance rates, they also set limits on driver benefits. There have also been doubts from the NDP as to whether or not drivers will see the 15% reduction in insurance rates that the bill aims to achieve, however several top insurance companies are already reporting an average reduction of 10%.
Regulating the Towing Industry
The other portion of Bill 15 aims to protect drivers (as consumers) by regulating the towing industry. The bill will require:
– Operators to provide customers with a list of services provided with separate charges.
– Operators receive permission from the driver, or someone speaking on the driver’s behalf, to provide services with full knowledge of the charges before towing the vehicle.
– Operators to provide customers with the option of paying by credit card
Operators will also be required to display training and certification documentation and drivers will have the option to turn down services offered by the first operator to arrive at the scene of an accident. While there has been some blowback from the towing industry, drivers will benefit from the safety and control that Bill 15 will provide.
What Should Drivers Look Out For?
If you are involved in an accident make sure you speak to your insurance representative about your rights to make a claim and the deadlines set on claims. The Ontario government is also in discussions with insurance companies to see if enforcing mandatory winter tires on drivers will help reduce insurance rates furthermore.