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Spotlight: Ontario motorists are peeved as record-level claims drive auto insurance premiums even higher

A new study from J.D. Power shows customer satisfaction at a low when it comes to car insurance
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The rising frequency of insurance claims and the growing cost of vehicle repairs have forced another year of auto insurance premium hikes in Ontario in 2019. And the result is exactly what you might expect.

Motorists are not happy.

J.D. Power’s latest study has revealed that customer satisfaction levels when it comes to auto insurance providers has hit a new low. And price sensitivity is playing the leading role as the ongoing drama between Ontarians and insurers continues to develop.

To offset rising costs for auto insurers, premiums have been pushed upward to where the national average has risen to $298. And while Alberta has seen the highest spike in auto insurance costs with premiums reaching $326, Ontario sits in a close second with motorists shelling out an average of $311 to stay on the roads.

“With such a dramatic increase in premiums, price sensitivity becomes an issue to which insurers should be very mindful,” commented J.D. Power insurance practice director Tom Super. “While we have seen pockets of claims frequency begin to stabilize, carriers continue to face profitability challenges in the auto sector, especially for those carriers that lagged the market on rate action.”

Key factors contributing to profitability issues for insurance providers in Ontario include the rising number of fraudulent auto insurance claims in the Province, the increased cost to repair more technologically advanced vehicles and the growing amount of claims due to distracted driving, despite the many deterrents in place.

Click here to learn how auto insurance companies adjust their rates.

J.D. Power’s study found that transparency when it comes to insurance rate increases could help limit the negative effect on satisfaction for customers. Satisfaction is higher among customers who saw an insurer-initiated increase in their premiums once they discussed their discount options and also completely understood their bill. Those customers who discussed discount options, completely understood their bill, and completely understood their policy saw their satisfaction score rise by the greatest margin.

“There are multiple ways to help customers realize the value of their policy,” Super explained. “Providing easy access to policy information via digital channels and having at least one annual touch point to review customers’ changing needs can go a long way in increasing satisfaction and loyalty.”

Although the Provincial Government has committed to exploring ways to relive the financial burden of auto insurance rates on Ontarians, motorists in the province are currently dealing with some of the highest rates in Canada.

For now, the best way for customers to find happiness with an insurer and keep up with rising auto insurance premiums is to shop around for the best rate. The easiest way for motorists to find a policy that meets their needs and budget is by using BayToday’s Insurance Hotline, an online tool that compares quotes from over thirty providers with a single search.