Thompson's News article: CADRI asks to use credit scores for Ontario auto
The Canadian Association of Direct Relationship Insurers wants its members to be allowed to use credit scores in auto insurance ratings in Ontario.
In its pre-budget consultation submission, the association said lower credit scores would translate into lower insurance costs for Ontario drivers.
“We seek automobile insurance that is priced fairly for Ontario’s drivers and a system that sustains competitive insurers to provide Ontario families with greater choice,” the association said in its submission. “To achieve these goals, we recommend a regulatory framework for auto insurance which is principle-based, outcome-focused and efficient.”
CADRI acknowledged that the Financial Services Regulatory Authority of Ontario has been revising its portfolio of rules to ensure that they are consumer-friendly, but pointed out that the provincial government, in its 2019 budget, recommended that ‘drivers should have the choice to lower their premiums by allowing insurers to consider their credit history.’
“We support the Ontario government moving to the next stage in its strategy and providing Ontario drivers with this opportunity.”
The association said that how an individual manages their finances is more predictive of whether they’ll make an insurance claim than other traditional risk variables.
“Credit scores are widely recognized as valid tools to predict insurance claims,” it said.
In provinces like Alberta and Nova Scotia, where credit information can be considered in auto insurance pricing, consumers typically have the option to consent to its use. However, if consumers decide not to provide consent, they won’t be refused insurance coverage.
(Copyright Thompson’s World Insurance News.)
February 9, 2024
Our pre-budget consultation submission asks government to
let Ontario customers allow insurers to use their credit ratings when