Your renewal premium can rise even if you have no accidents or tickets. Company-wide rate changes, higher claim costs or revised rating data may all increase the price.
For this article, we reviewed FSRA’s guides to Ontario rating factors, market conditions and rate approvals, Ontario’s credit-information rule and FSRA’s consumer savings guidance.
Can Car Insurance Go Up Without an Accident?
Yes. A premium can increase without a recent moving violation or accident, but the insurer should be able to explain the reason. Reasons for increases include a general rate increase, higher claim costs, a change in your area’s insurance rating zone or changes to information on your policy.
Ontario insurers must get FSRA approval to change rates. FSRA-approved rate changes can affect groups of customers or all customers. However, this does not mean that everyone will be impacted equally.
Read More: Benchmark Your Ontario Premium
Reasons Your Car Insurance Rate Can Increase
Tickets and Other Violations
Driving convictions can also affect your rate. Ask your insurer whether a conviction caused a rate increase and how long they will consider it. This is different from demerit points. Demerit points are a penalty but don’t necessarily relate to how much you are charged.
Personal Changes
Insurers consider claims and insurance costs in your location when setting rates. Accidents, thefts and weather-related losses vary by area. Moving doesn’t necessarily mean higher insurance rates, but if your rates went up after your move, make sure your street address and postal code are correct. Ask your insurance company how your new address affected your rates.
Changes in drivers and/or changes to your household will affect your premium. Contact your insurer to understand which change affected your rates. Examples: adding or removing a driver; making a different driver the primary driver; gaining experience; change in licence type.
Read More: Learn How an Address Change Can Affect Your Policy
Climate Change
FSRA explains how regional weather losses can affect pricing. Storms, floods, hail, wildfires, etc., can increase the number of claims and the cost of claims in an area. Rates are based on the amount insurers expect to pay on claims in an area, not a “climate change” charge on your policy.
Vehicle Theft
FSRA notes that theft risk and claims costs can affect insurance rates in Ontario.
Before buying a particular year, make and model, get an insurance quote. Ask if there is an additional theft charge and if there is a discount for having an anti-theft device.
Inflation
Higher costs for parts, labour, vehicle replacement and technology are increasing the estimated cost of future insurance claims. Those market costs can lead to increased insurance rates even if your personal driving record has not changed.
Read More: How to Effectively Manage Car Insurance Renewal
What You Can Do to Keep Your Car Insurance Rates Lower
Take a Driving Course
Always check with your insurer whether completing a recognized driver-training course will make a new driver eligible for a discount. Completing a recognized driver-training course doesn’t necessarily reduce your renewal premium.
Check Which Discounts or Policy Details Changed
If you live in Ontario, check the discounts on last term’s policy as well as those offered on your current policy. Changes to your address, drivers, car use or annual kilometres can affect your policy. In Ontario, auto insurers can't use your credit information to determine your rate.
Buy the Right Car
Insurance costs vary by vehicle, depending on its retail price, theft rates, safety features, parts availability, repair difficulty and more. Get insurance quotes for a few different gasoline, hybrid and electric vehicles before deciding which one to buy.
Bundle Your Insurance Policies
Bundle policies, but compare prices. Although it is not always the cheapest option, insurance companies sometimes offer a discount for bundling home and auto insurance or insuring more than one car. Compare the price and coverage of bundled and separate policies before purchasing.
Pay Premiums Up Front
Always ask for both the annual and monthly totals. In some cases, you can avoid instalment fees by paying in advance; other times, there are no upfront savings.
Compare Insurance Quotes
If a quote comes in at a lower rate, make sure all coverages are the same and the drivers and usage are identical.
If you’re driving fewer kilometres per year, report them accurately and update your commute details. If you’re using your vehicle less than you used to, ask about discounts for driving fewer kilometres or pay-as-you-drive options.
Pick the Best Policy
Saving on your premium may not be smart if you’ll be paying to repair or replace your vehicle after a loss. First determine which coverages are mandatory in your province. Then look at each optional coverage, such as collision, comprehensive, endorsements, policy limits and deductibles, to determine whether you want to include it in your auto insurance policy.
Read More: Review Ways to Save on Car Insurance in Ontario
A Five-Step Renewal Diagnostic
Use this list to determine whether a rate increase applies to most policies or only to your policy.
- Compare premium amounts by coverage, limits, deductibles, vehicles, drivers, address, vehicle usage, annual kilometres and discounts between the expiring and renewal declaration pages.
- Ask your insurance company, agent or broker what changes were made to the information used to determine your premium. In Ontario, you can also go to FSRA’s rate-approval database to see whether your insurer’s rate changes were approved.
- Keep written confirmation of your home address, how you use your car, drivers, kilometres, car details and discounts. If anything is incorrect, amend it before renewal and request a revised premium.
- A cheaper policy is no bargain if you’re not getting the protection you need. Make sure you’re comparing quotes using the same drivers, coverage, policy limits and deductibles.
- If this doesn’t resolve your issue, follow your insurance company’s formal complaints procedure and/or contact your provincial regulator or ombudsperson.
Read More: See How Often to Check Auto Insurance Rates