If you drive, you need auto insurance and you have probably heard about the auto insurance reforms that became effective in Ontario on September 1st. What you may not have heard about though, is what those reforms are and why they were necessary.

The auto insurance industry has been faced with an overwhelming increase in costs and fraudulent claims over the years and needed to do something to put an end to, or at least reduce, the number of illegitimate claims made. According to Finance Minister, Dwight Duncan, between 2004 and 2009, caregiver costs ballooned 450%, costs of exams and assessments skyrocketed 258% and housekeeping costs went up 280% while the number of accidents stayed stable.

With an eye to reducing costs, preventing fraudulent claims and controlling premium increases for responsible drivers, Ontario has introduced many changes to the auto insurance industry that will give consumers choice over how much coverage they purchase and at what cost. Some of these changes include reduced limits to the standard, mandatory auto insurance benefits packages and different “buy-back” options.

With more choice; however, comes more responsibility on the consumer to be educated on the options available. The Insurance Bureau of Canada has posted an easy-to-use guide to these changes on its website. Learn everything you need to know by visiting their website at www.ibc.ca. Financial Services Commission of Ontario (FSCO) has also posted information on the auto insurance reforms.