Summary#

Bill 103, the Ending Automobile Insurance Discrimination in the Greater Toronto Area Act, 2022, would amend Ontario’s Insurance Act. Its stated goal is to prevent automobile insurance rates from differing because of which municipality or area within the Greater Toronto Area (GTA) a person lives in.

• The Chief Executive Officer of the Financial Services Regulatory Authority of Ontario (FSRA) would have to refuse approval of certain insurer risk-classification systems: those that use where a person lives within the GTA and allow different rates for the same coverage or category in different GTA municipalities or areas.
• Insurers would be prohibited from offering, entering into or renewing GTA residents’ insurance contracts when the rate is based on such a system and would differ depending on the resident’s GTA municipality or area.
• The bill defines the GTA as Toronto and the regional municipalities of Durham, Halton, Peel and York.
• The bill would not set insurance prices or require every GTA driver to pay the same rate. It targets differences based on municipality or area; rates could still differ for other reasons.
• The bill would take effect on Royal Assent. The supplied material does not give its current passage status.

What it means for you#

• GTA drivers: If passed, your insurer could not charge a different rate for the same coverage or category solely because you live in one GTA municipality or area rather than another. The bill does not guarantee that your premium would fall or that every GTA driver would pay the same amount.
• Drivers elsewhere in Ontario: The bill’s restrictions apply to GTA residents. It does not directly change how rates are set outside the GTA.
• Insurers: They would have to avoid using the specified kind of geographic rate difference in contracts for GTA residents.
• FSRA: Its Chief Executive Officer would have a mandatory duty to refuse approval of risk-classification systems that meet the bill’s conditions.
• The supplied material does not include the current Insurance Act, so the existing approval and rate-setting rules could not be checked against this bill.

Money#

No cost information is in the available material.

• The bill assigns a new approval duty to FSRA’s Chief Executive Officer, but gives no estimate for staffing or administration costs.
• It gives no estimate of how premiums might change for drivers, insurers’ compliance costs, or any effect on public revenue.

What is unclear#

• The bill does not explain how insurers would change their rate systems or how FSRA would assess compliance beyond the approval rule.
• It does not define “geographic region” or “other areas” within the GTA.
• It does not specify monitoring, penalties, complaints, appeals or reporting rules for the contract prohibition.
• It does not say how the change would affect premiums overall or how differences between drivers would be handled after GTA location-based differences are restricted.

Case for#

• The bill appears intended to stop a driver’s GTA municipality or area from being used to charge a different rate for the same coverage.
• Requiring FSRA to refuse approval of qualifying systems, and barring insurers from using them in contracts, gives the restriction a direct legal effect.
• Treating the GTA as one geographic area for this purpose could make rates less dependent on municipal boundaries.

Case against#

• One concern is that the bill restricts insurers from distinguishing between GTA areas even when they use those areas as risk factors. The bill does not explain how insurers would set rates instead.
• It is unclear how FSRA would identify and enforce the contract prohibition after approval.
• The bill gives no cost estimate, implementation details or process for resolving disputes about whether a rate difference is based on GTA location.