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2 weeks ago

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I sat down to read the Auditor General’s November 30, 2022 report on auto insurance.  It’s an interesting read and seems to suggest that there are some more reforms coming soon…The old David Marshall report from 2017 is being referred to by the AG….and the government has again confirmed their commitment to the 2019 Putting Drivers First Blueprint (which included care not cash as a standard policy option, more “choice” on what benefits are included, reforming the medical assessment procedure, etc. – Link to the Blueprint: )……there are also recommendations for the monitoring of Healthcare Service Providers within the AG’s new report.

The link to the AG’s November 30, 2022 report is here:

Some of the highlights include:

*In the private passenger automobile insurance sector, despite Ontario having a rate of automobile injuries per one billion kilometres travelled that is lower than most other provinces, Ontario’s average private passenger automobile insurance rate is the highest in the country…In 2020, Ontario’s injury rate of about 238 accidents per one billion kilometres was lower than all other provinces except Alberta.


*For instance, neither the Ministry of Finance nor FSRA has done significant work to … or address the costly medical assessment process, which at times results in duplicate medical assessments being performed, that occurs in certain accident benefits cases. These factors have resulted in a costlier insurance model for Ontarians and inefficiencies in how the industry operates…the average premium increased by [between 2017 and 2021], double the rate of inflation


*For example, like Alberta, Ontario could develop more protocols to treat automobile accident injuries instead of providing cash for those injured to seek their own treatment…We noted that several reports over the last decade have proposed similar initiatives to improve Ontario’s private passenger automobile insurance sector; however, the Ministry of Finance (Ministry) has not provided FSRA with direction to take any significant action on these proposals


*Over the past decade, several reports have proposed ways to make Ontario’s automobile insurance industry operate more effectively and at a lower cost (see Appendix 9). One important report is Fair Benefits Fairly Delivered: A Review of the Auto Insurance System in Ontario written in 2017 by David Marshall (former President and CEO of the Workplace Safety and Insurance Board), who was appointed by the Ministry of Finance in 2016 to review the province’s automobile insurance system and make recommendations to the government of the day for improvements. Appendix 10 lists the recommendations made in Marshall’s initial report. To date, little action has been taken on the report’s several proposals and recommendations. We have summarized four areas where improvements to the industry could potentially reduce automobile insurance premiums in Ontario and make the sector more efficient. The first three are discussed in detail in Appendix 11.


*This model of automobile insurance in Ontario creates an incentive for accident victims and lawyers to seek cash for potential health costs instead of treatment, as well as cash for legal and settlement fees that insurance companies pay, which are costs ultimately passed onto insurance policyholders.


*Ontario has a Minor Injury Guideline (MIG) in place, but it has not been reviewed since 2014. Reforming the current system in Ontario by creating a more structured approach or “programs of care” for both minor and non-minor injuries—outcome-focused treatment plans designed around the patient’s needs—could potentially reduce legal and frivolous claims, thereby decreasing overall private passenger automobile insurance premiums


*The current system can result in multiple assessments being conducted to determine the severity of an accident victim’s injuries. This can delay when an accident victim receives the care they require. In his 2017 report to the Ministry, Marshall also discussed the high costs of medical assessments to the system in Ontario.


*The government of Ontario has put forward proposals to improve the regulation of the automobile insurance sector. Its 2019 The Blueprint for Putting Drivers First Plan included 21 initiatives to, for example, lower costs, reform the medical assessments process and make the automobile insurance market more competitive. Some of the items within this plan align with recommendations Marshall made in his 2017 report to the government, such as implementing a “Care, Not Cash” approach. However, partly due to the COVID‑19 pandemic, no action has been taken on multiple initiatives (see Appendix 12 for the government of Ontario’s progress against its 2019 The Blueprint for Putting Drivers First Plan). In its 2022 Budget, the Province reaffirmed its commitment to this blueprint and to “continue fixing automobile insurance”


*We found that a major insurance company, Aviva, had a disproportionately large number of applications and appeals at the Tribunal. As shown in Figure 18, this insurer held about 12% of the total market share of the industry in Ontario in 2020, but was involved with over 19% of the appeals at the Tribunal in the 2018/19 fiscal year. This does not necessarily mean that Aviva is over-utilizing the LAT or engaging in inappropriate behaviour with its customers, or that other automobile insurance companies are appropriately using the LAT. However, without further discussion with or inspection of automobile insurance companies or further analysis of cases heard before the LAT, this is still unclear.



-develop and implement up-to-date programs of care for injuries such as sprains, strains and whiplash to standardize the treatment provided to clients after an accident and the costs of such treatment, beyond just those of minor injuries; • assess the cost of implementing a centralized medical assessment process, and if beneficial and cost-effective, implement that process while requiring both insurers and consumers to use the process to reduce the amount of medical assessments and disputes related to those assessments;

MINISTRY RESPONSE: The Ministry acknowledges there have been a number of valuable reports on automobile insurance in the past and will continue to consider them where relevant as it works with FSRA to implement The Blueprint for Putting Drivers First Plan, first announced in the 2019 budget and the 2022 budget commitments to continue improving automobile insurance in Ontario.



*To improve regulatory oversight of health-care service providers (HSPs) who provide medical treatment to individuals involved in private passenger automobile accidents, we recommend that the Financial Services Regulatory Authority of Ontario (FSRA): • determine under what conditions should further review of an unlicensed HSP occur; • return to on-site inspections of HSPs as soon as operationally possible; and • require HSPs to provide evidence (such as through attestation) that they have corrected all issues identified during an inspection, and conduct follow-up examinations or desk reviews to confirm this on a risk basis.

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