Bill 100 2013

An Act to amend the Insurance Act in respect of automobile insurance risk classification systems

Her Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows:

   1.  Subsection 121 (1) of the Insurance Act is amended by adding the following paragraph:

36.3 prescribing circumstances for the purposes of subsection 417.0.3 (5);

   2.  The Act is amended by adding the following sections:

Risk classification systems, minor accident paid by insured

   417.0.2  (1)  No insurer shall use a risk classification system in classifying risks for a coverage or category of automobile insurance that permits an insurer to consider a minor accident within the meaning of subsection (2).

Minor accident

   (2)  For the purposes of subsection (1), an accident is a minor accident if,

  (a)  the accident did not cause more than $2,500 in damages;

  (b)  the accident did not cause any bodily injuries or the death of any person; and

   (c)  no insurer made any payments as a result of the accident that were not fully reimbursed by an insured party.

Definitions

   (3)  In this section,

"insurer" includes the Facility Association.

Risk classification systems, new drivers

   417.0.3  (1)  No insurer shall use a risk classification system in determining rates for each coverage and category of automobile insurance unless the system provides for lower rates for new drivers in accordance with this section and the regulations.

Credited driving experience

   (2)  Subject to subsections (4) and (5), in fixing rates for new drivers under a risk classification system, an insurer shall credit new drivers with additional years of driving experience.

Same

   (3)  For the purposes of subsection (2), the total number of years with which a new driver shall be credited shall be at least,

  (a)  six years, if the driver,

           (i)  has completed a Ministry-approved driver education course at a driving school that is licensed under the Highway Traffic Act, or

          (ii)  has completed a driver education course at a licensed driving school in North America that is substantially similar to a Ministry-approved driver education course; and

  (b)  three years in all other cases.

Disqualifications

   (4)  A new driver is disqualified from receiving credit for additional years of driving experience under subsection (2),

  (a)  if he or she has been found to be more than 25 per cent at fault in a claim arising out of a motor vehicle accident;

  (b)  if, subject to clause (6) (a), his or her licence has been suspended for non-payment of a fine for an offence relating to the use or operation of a motor vehicle; or

   (c)  if, subject to clause (6) (b), he or she has been convicted of,

           (i)  a provincial offence in relation to the use or operation of a motor vehicle,

          (ii)  an offence under the Criminal Code (Canada) in relation to the use or operation of a motor vehicle, or

         (iii)  an offence under the laws of another jurisdiction in North America that is substantially similar to an offence described in subclause (i) or (ii).

Further prescribed disqualifications

   (5)  A new driver is disqualified from receiving credit for additional years of driving experience under subsection (2) in the circumstances prescribed by regulation.

Exception for parking offences

   (6)  A new driver is not disqualified,

  (a)  under clause (4) (b) as a result of a suspension of his or her driver's licence for non-payment of a fine that is solely related to the unlawful parking of a motor vehicle; or

  (b)  under clause (4) (c) as a result of a conviction for an offence that is solely related to the unlawful parking of a motor vehicle.

Definitions

   (7)  In this section,

"insurer" includes the Facility Association; ("assureur")

"Ministry-approved" means approved by the Ministry of Transportation under the Highway Traffic Act; ("approuvé par le ministère")

"motor vehicle" has the same meaning as in subsection 1 (1) of the Highway Traffic Act; ("véhicule automobile")

"new driver" means a driver with less than six years driving experience. ("nouveau conducteur")

Commencement

   3.  This Act comes into force on a day to be named by proclamation of the Lieutenant Governor.

Short title

   4.  The short title of this Act is the Insurance Amendment Act (Minor Accidents and New Drivers), 2013.

 

EXPLANATORY NOTE

The Bill requires that a risk classification system used by an insurer to determine rates for automobile insurance shall not consider minor accidents and shall provide for lower rates for new drivers by crediting new drivers, in certain circumstances, with additional years of driving experience.

Minor accidents are accidents that result in $2,500 or less in damages, no injuries or death, and that did not result in an insurer making any payments that were not fully reimbursed by an insured driver.

A new driver is disqualified from receiving additional years of credit in a number of circumstances, including if the driver has been found to be more than 25% at fault in a claim arising from an accident, has been convicted of certain driving offences or has had his or her driver's licence suspended for non-payment of certain fines.