An Important Change to Telematics for Auto Insurance in Ontario
An important change to how telematics or usage based insurance is used for setting auto insurance rates in Ontario has been announced. Read on to learn more about what this means for you and your coverage…
Telematics in a nutshell
What is telematics or usage based insurance? In a nutshell it involves insurance companies monitoring how and when one drives, either with a device plugged into a vehicle or via smartphone app, and using this data to set auto insurance rates. Many drivers have taken advantage of the discounts available to good drivers.
Click here to learn more about telematics and how it can help you get the best auto insurance rates possible.
The new change to telematics
So what has changed? Previously, auto insurers leveraging telematics in setting insurance rates were only able to use the data around driving behaviour to offer better rates to good drivers. In other words, insurers could only offer discounts on their rates and you could not be punished with higher rates for bad driving.
This has now changed. Insurers that operate with the usage based model can now use surcharges against risky or undesirable driving behaviour. Any insurer that wants to do so must propose this to the Financial Services Regulatory Authority (FSRA) of Ontario in a rate filing. The reason the FSRA is requiring an approval process is that they want to be sure that how insurance rates are set using this type of telematics data is clear to the consumer.
Telematics surcharges arrive for Ontario auto – Canadian Underwriter
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Do you currently use telematics and want to learn more about what this change means for you and your auto insurance rates in Ontario? Are you curious about how usage based insurance could get you cheaper insurance? Please feel free to reach out to one of our insurance professionals with any questions you might have around telematics and insurance. We’ll be happy to help you decide on what the best option is for you and your situation.
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