In the province of Ontario, and in much of the rest of the world, auto insurance rates decreased during the pandemic due to less volume on the roads, and the fact that many insurance companies offered rebates or cut premiums during this time. Unfortunately, as traffic has begun to return to its pre-pandemic levels, premiums are once more on the rise again – and continuing to remain as such, due to national and regional influences out of drivers’ control.
The car insurance Ontario drivers pay for on a monthly or yearly basis has changed yet again. Here are the influences that may be impacting your car insurance rates.
Inflation rates are up in Canada.
Inflation. It’s one of those buzz words, but what it really means is the rising price of goods and services. Insurance is not immune to inflation’s impacts. Inflation won’t impact your car insurance rates throughout the policy term luckily, but drivers will see the effects upon renewal time.
Accident rates are increasing post-pandemic.
During the pandemic, everything was pretty casual on the roads. Because people were working from home, there wasn’t a whole lot of reason to be out-and-about, save for bare necessities. After the pandemic’s stay-at-home orders have been lifted, people are starting to see the repercussions of impatient drivers once more. During the pandemic, a lot of people didn’t drive at all, and a lot of people returning to driving post-pandemic are now struggling with refreshing their driving skills. This, unfortunately, has resulted in a lot of accidents post-pandemic, increasing the amount insurance companies need to pay out for claims, and consequently resulting in them having to raise rates to manage their “pool” of payout money.
Labour shortages and repair costs.
More repercussions from the pandemic – unfortunately, for a lot of reasons, but partly due to disruptions in the supply chain, labour shortages have resulted in heightened repair costs. In tandem with inflation, professional auto body services cost more, as do replacement parts, which makes repairs for damaged vehicles much more expensive to do. In turn, insurance companies have hiked rates to ensure they have enough money to cover the rise in costs.
Vehicles cost more.
As we advance in technology and create more “smart” cars with interesting safety technology and tech that, we create safer roads, but we also create more expensive cars. See, these vehicles with their Infotainment centers, their blindspot monitors, rearview cameras, etc. are becoming commonplace, but with those commonalties also comes an added cost. Cars are simply becoming more expensive to make, even while they’re making the roads safer.
Unfortunately, this means that collision and comprehensive insurance portion on your vehicle may cost you more. This results in an overall hike in your insurance costs.
Natural disaster rates are climbing.
Due to climate change and global warming, the frequency of natural disasters is climbing. We see a lot of vehicles out for repairs due to things like flooding, wildfires, and even hailstorms. As a result, more claims are being made and therefore insurance companies are having to, once again, raise your rates to compensate for claim payouts.
How to manage your car insurance rates
While these factors raising your rates are out of your control, there are a few things you may be able to do to compensate and manage your car insurance rates. Those are as follows:
- Raise your deductible to qualify for a deductible insurance discount.
- Inquire about group discounts.
- Acquire multiple policies through a single provider.
- Drive less. Use public transport instead.
- Drop comprehensive coverage and collision coverage on an older vehicle.
- Drive safely. Take a defensive driving course if you have a poor driving record.
- Ask about telematics or usage-based insurance if you’re a good driver.
- Go paperless. Get your insurance documents digitally rather than having them mailed to you. Some companies offer up to 15% for paperless discounts.
Try acquiring a few car insurance quotes from multiple different companies to gauge costs if you don’t love the amount your insurance has increased by and you’d like another option. You can also enlist a broker to do this work for you.