One of Premier Doug Ford's vehicles sits parked at the Ontario legislature in a 2020 file photo.Frank Gunn/The Canadian Press
Doug Ford is going where several of Ontario’s premiers have gone before: on a quest to reduce the province’s astronomical auto insurance premiums.
Mr. Ford’s suite of changes comes into effect on July 1, when a number of benefits that provide financial support for people injured in motor vehicle accidents are set to become optional. The point is to give drivers “an opportunity to lower their premiums,” the government said in its 2024 budget.
The province is preserving a core, mandatory standard of coverage for the cost of medical expenses, rehabilitation services and attendant care – think paying for someone to help you bathe and get dressed after a serious car crash injury. But everything else that is currently included in every policy as standard coverage will be extra.
The benefits that will become elective include coverage for expenses ranging from funeral costs, through housekeeping and maintenance, to paying for a caregiver, if you can no longer look after dependents such as children or elderly relatives. Crucially, they also include benefits that provide some temporary financial assistance if you become unable to work.
What to know about auto insurance changes in Ontario and Alberta
One frequent criticism of the reform is that it will be the drivers who can least afford to reduce their coverage who will be most likely to drop or skip the optional benefits to reduce their monthly premiums. Particularly at risk are low-income and gig workers with no employer disability benefits who’d be left to rely entirely on meagre public supports such as employment insurance sickness benefits, the Canada Pension Plan disability benefit or social insurance.
Young people are also more likely to choose bare-bones coverage because, like anyone taking out a new auto insurance policy, they’ll be asked if they want to opt into newly optional benefits. By contrast, those with existing policies will have to tell their insurers they want to reduce optional benefits.
But there’s another, less talked-about problem. For all this, the savings that drivers can expect from these changes are likely to be small and, potentially, only temporary, a number of experts warn.
The reform delivers “very little affordability,” said Harvey Naglie, a consumer advocate and former senior policy adviser with the Ontario Ministry of Finance.
Mr. Ford is grappling with an age-old problem. Auto insurance in Ontario has long been among the most expensive in Canada. On average Ontarians pay twice or more what drivers in Quebec spend on premiums, industry data show.
To make matters worse, Ontario’s already high premiums have been rising at a staggering pace over the past few years, as the industry faces ever higher car repair costs and an auto theft crisis. Between June, 2024, and October, 2025, the province’s average premium climbed to $2,164 from $1,927, an increase of more than 12 per cent in 16 months, provincial government data show.
Mr. Ford’s solution is to cut costs for drivers by allowing them to pay less for less coverage.
Doug Ford is the latest Ontario leader to attempt to reduce the province's high auto insurance premiums.Chris Young/The Canadian Press
The government argues that many of the accident benefits that are currently mandatory are unnecessary or redundant for many people.
For example, if you have no dependents, you don’t need caregiver benefits. If you have workplace benefits, some of them likely overlap with the auto insurance benefits that will now become elective. (Also important to know, the new rules ensure that auto insurance will pay first for the cost of medical and rehabilitation expenses caused by a car accident, before you have to tap your employer or private insurance coverage.)
It’s also not clear that chiseling away at your accidents-benefits coverage will result in substantially lower premiums.
Last year, Colin Simpson, the CEO of the Insurance Brokers Association of Ontario (IBAO), estimated that the savings would likely amount to $100 a year at most, according to Canadian Underwriter, a trade publication. That is not much on average annual premiums hovering around $2,000. And whether those – potentially small — savings will last is also an open question.
In 2019, Mr. Ford’s first provincial budget noted that “over the past 30 years, Ontario’s auto insurance system has gone through a series of ineffective patchwork reforms implemented by different governments.”
Yet, his own government is now delivering another tweak at the margin that “doesn’t take costs out of the system,” Mr. Naglie said.
In fact, the changes could end up pushing up costs over time, some industry watchers, including Mr. Naglie, say.
The big guide to auto insurance
Part of the reason why premiums are so high in Ontario is that the province has the most complex auto insurance architecture in Canada. It allows people who get hurt in an accident to access a limited menu of benefits regardless of who’s at fault in the collision, through what’s known as a no-fault regime. But in some cases, it also allows injured parties to sue those presumed at fault for damages, in what’s known as tort litigation.
It’s a setup that has been breeding disputes between accident victims and insurers about benefits eligibility, in addition to allowing years-long legal battles over tort claims, said Erik Knutsen, a law professor at Queen’s University. By one estimate, legal and other dispute-related fees make up 30 to 35 per cent of Ontario’s auto insurance costs for personal injury claims.
Navigating such a complex and litigious system is expensive for insurers, and those costs have been finding their way back to consumers through high premiums.
Mr. Naglie worries that making more no-fault benefits – and particularly income replacement support – optional means that people injured in a car crash who only have access to bare-bones coverage will have more of an incentive to sue for damages in tort claims.
Shawn Patey, a Toronto-based mediator with decades of experience in personal injury and insurance cases, expects the changes will also add a slew of new variables to consider in tort cases.
What an injured party receives through no-fault benefits is typically subtracted from what they can be awarded in a lawsuit. So Ontario’s new à la carte benefits model will complicate the math of calculating damages, according to Mr. Patey.
“You could have two people with very similar injuries arrive at a mediation with completely different benefit structures, depending on what optional coverage they purchased or declined years earlier,” he said.
Vehicles turn onto the Gardiner Expressway in downtown Toronto.Fred Lum/The Globe and Mail
Not everyone shares these concerns. Prof. Knutsen doesn’t see much risk of more tort lawsuits as a result of the reform, in part because large sums of money are typically at stake in tort cases.
Whether or not a driver has opted into income replacement benefits – which currently provide only up to $400 a week, tax free, for up to two years, as part of the standard coverage – isn’t likely to significantly affect whether people decide to sue over financial losses caused by an accident, Prof. Knutsen said.
But he still sees the risk that the upcoming changes will lead to more disputes – not against at-fault drivers but between policy holders and their own insurance agents or brokers.
“Maybe in your life circumstances you should have turned on one of these optional coverages or didn’t understand you might need it. And then you get in a car accident and find out, ‘Hey, I thought I had that or I should have needed that. Why didn’t my agent or broker tell me?’” he said.
“In that instance, your lawsuit is not with your driver, your lawsuit is with your insurance agent or broker.”
In short, the reform does nothing to simplify the current system and reduce its reliance on costly litigation. If anything, it may make things worse.
“It moves risk onto consumers rather than actually taking risk out of the system,” Mr. Naglie said.
