Bill 45 explained in plain English
Insurance Amendment Act (Risk Classification Systems for Automobile Insurance), 2012
Ontario legislature bill summary, status, timeline, sponsor, votes, and official sources.
At a glance
Official Legislative Assembly of Ontario snapshot for 40th Parliament, 1st Session. Representative vote breakdowns appear when the Assembly publishes an Ayes and Nays page for the bill.
Our plain-language take, written for civic education.
Source: By PoliticalData.ca
Bill 45 amends Ontario's Insurance Act to mandate specific factors and their order of importance for determining automobile insurance risk classifications and rates, while prohibiting the use of geographical region and requiring clearer explanations to policyholders.
This bill, the Insurance Amendment Act (Risk Classification Systems for Automobile Insurance), 2012, changes how insurance companies in Ontario can determine the risk classifications and rates for automobile insurance. It introduces mandatory factors that must be considered in a specific order of importance: driving safety record (only for accidents where the insured was primarily at fault), annual kilometers driven, years of driving experience, and the population of the statistical area where the driver lives. Insurers are prohibited from using the insured person's geographical region as a factor. The bill also requires insurers to provide clear, written explanations to policyholders about how their rates are determined, especially in cases of rate increases upon renewal. The Superintendent of Financial Services has the power to refuse approval of risk classification systems that do not meet these new criteria. The changes are set to take effect on January 1, 2014.
- Amends the Insurance Act to establish mandatory factors and their order of importance for automobile insurance risk classification systems.
- Prohibits insurers from using an insured person's geographical region as a factor in risk classification.
- Requires insurers to provide written explanations of risk classification systems and rate determinations to policyholders.
- Grants the Superintendent of Financial Services the authority to refuse approval of risk classification systems that do not comply with the new requirements.
- Specifies that only accidents where the insured person was primarily at fault can be considered in their driving safety record for risk classification.
- Automobile insurance policyholders in Ontario
- Insurance companies providing automobile insurance in Ontario
- The Superintendent of Financial Services in Ontario
- Insurers must use specific factors in a defined order of importance when classifying risks for automobile insurance.
- Insurers are prohibited from using an insured person's geographical region as a risk classification factor.
- Insurers must provide written explanations of risk classification systems and rate determinations to policyholders in plain language.
- Policyholders have the right to receive clear explanations about how their automobile insurance rates are determined.
- The Superintendent of Financial Services has the power to refuse approval of risk classification systems that do not comply with the law.
- This Act comes into force on January 1, 2014.
- The bill may affect the calculation of automobile insurance rates by insurers, potentially leading to changes in premiums for policyholders based on the mandated risk classification factors.
- The Superintendent of Financial Services is empowered to refuse to approve an insurer's risk classification system if it does not comply with the requirements outlined in the Act.
- The bill does not specify the exact monetary amounts or percentages for rate changes that would trigger a phase-in application, as these are to be prescribed by regulation (Section 5(1)).
- The specific 'other prescribed information' that insurers must provide regarding rate determinations is not detailed in the bill and is subject to regulation (Sections 1 and 2).
- The definition of 'statistical area' is based on Statistics Canada's classification, which may be subject to updates or changes by that agency (Section 3(1.3)).
- The precise determination of 'principally at fault' for accidents is to be made in accordance with regulations, as mentioned in Section 3(1.2).
- The exact weight to be given to additional factors used in risk classification, beyond the mandated ones, is subject to regulations, as is the weight for the population of statistical areas with less than 10,000 residents (Section 3(1.4) and 3(2)).
This bill amends the Insurance Act to change the rules for how insurance companies classify risks and set rates for car insurance. It mandates specific factors to be used in determining these rates and requires insurers to provide more information to policyholders.
Source: Throughout the bill, particularly Sections 1, 2, 3, 4, and 5.
This section is amended to define the mandatory factors that must be used in determining automobile insurance risk classification systems, their order of importance, and to prohibit the use of geographical regions. It also clarifies how additional factors can be used and sets rules for statistical areas and population thresholds.
Source: Section 3
This subsection is repealed and replaced to specify the grounds on which the Superintendent of Financial Services must refuse to approve an automobile insurance risk classification system, including non-compliance with Section 410, or if the system or rates are deemed not just, reasonable, predictive of risk, or fair in distinguishing risks, or if they would impair the insurer's solvency or are excessive.
Source: Section 4
This subsection is amended to grant regulation-making powers regarding information that must be provided to policyholders about rate determinations, rules for using risk classification factors, and transitional matters. Certain existing paragraphs related to risk classification rules are repealed and substituted.
Source: Section 1
This section is added to require insurers to provide written explanations in plain language to individuals about the risk classification system used to determine their automobile insurance rate before a new contract is entered into, and upon renewal if there is a rate increase of 5% or more not related to a claim.
Source: Section 2
This section is amended to replace provisions concerning the prescribed maximum monetary amounts and percentages by which a rate for a class of risks may increase or decrease due to the application of Section 410 or related regulations. It also modifies rules regarding applications for phasing in rate changes over a specified period.
Source: Section 5
Generated using AI from official bill text. Not legal advice. It is written by PoliticalData.ca for civic education, automatically checked and spot-reviewed before publishing.
Official textProcess Snapshot
Vote Summary
This bill does not have a published recorded division in the current official sources, so representative-by-representative vote counts are not shown.
No published representative vote breakdown
The current official sources do not publish a recorded division breakdown for this bill, so there is no representative-by-representative table to show.
Official sources
Status, sponsor, votes, and timeline on this page are drawn from these official legislative sources and public records. Each summary above is attributed to its own source.
How this data is sourced