Private Passenger Automobile Insurance Rates Decline During Second Quarter 1998

July 17, 1998 (NORTH YORK, Ont.) -- Ontario private passenger auto insurance rates decreased during the second quarter of 1998, marking the eighth successive quarterly decrease since 1996, according to the latest rate information published by the Financial Services Commission of Ontario (FSCO).

The rates approved during the second quarter ending June 30, 1998 indicate a decrease in auto insurance rates of 2.46%, when weighted by market share. Of the 22 rate filings that were approved for reductions, the rate decreases ranged from 0.04% to 13%.

The average cost of auto insurance in Ontario at the end of the second quarter of 1998 was 9.61% lower than at the end of the third quarter of 1996, (the last quarter prior to the introduction of Bill 59, the Automobile Insurance Rate Stability Act, 1996).

In reviewing rate filings, the FSCO looks for actuarial soundness and ensures that an insurance company's projected rates are based on solid and verifiable information. These rates must be able to sustain the company's long-term capacity to meet its claim costs. The FSCO also scrutinizes company filings for inefficiencies in the claims management process to prevent such costs from being passed on to consumers.

On July 1, 1998, the Ontario Insurance Commission which normally published the rate information, merged with the Pension Commission of Ontario and the Deposit Institutions Division of the Ministry of Finance to become FSCO. The 1998 second quarter rates were approved by the OIC before FSCO came into force.

The FSCO publishes rate information to help consumers make better choices among insurers. The information is available in its Rate Guide, or through FSCO's internet website at <http://www.fsco.gov.on.ca>. Consumers who are unclear about what prices they are paying for specific coverages should check with their agent, broker or insurance company and/or shop around to see how their premium compares in the marketplace.

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Media contact: Willie Handler, FSCO (416) 590-7230

ONTARIO PRIVATE PASSENGER AUTOMOBILE INSURANCE RATE FILINGS APPROVED

April 1, 1998 to June 30, 1998
Company
Market Share
(1997)
Effective New Business Date
Effective Renewal Business Date
Approved Rate Change
Allstate Insurance Company of Canada 3.90% May 1, 1998 Jun 15, 1998 -0.55%
Allstate Insurance Company of Canada 3.90% Jun 15, 1998 Aug 1, 1998 0.00%1
Belair Insurance Company Inc. 1.36% Jul 1, 1998 Aug 15, 1998 -3.46%
CAA Insurance Company (Ontario) 1.14% Aug 4, 1998 Sep 4, 1998 0.00%2
CAA Insurance Company (Ontario) 1.14% Aug 4, 1998 Sep 4, 1998 -4.12%
Coachman Insurance Company 0.36% May 1, 1998 May 1, 1998 -3.77%
Co-operators General Insurance Company 7.64% Jun 1, 1998 Jun 1, 1998 0.00%3
Coseco Insurance Company 1.12% May 15, 1998 Jul 1, 1998 -1.32%
CT Direct Insurance Inc. 0.00% May 1, 1998 N/A 0.00%4
Dominion of Canada General Insurance Company 4.87% Jul 1, 1998 Sep 1, 1998 -1.00%
Echelon General Insurance Company 0.00% Jun 1, 1998 Jun 1, 1998 0.00%4
Economical Mutual Insurance Company 4.65% Jun 1, 1998 Aug 1, 1998 -0.04%
Economical Mutual Insurance Company 4.65% Jun 15, 1998 Aug 15, 1998 -0.80%
Facility Association 2.71% Oct 1, 1998 Oct 1, 1998 -9.10%
Federated Insurance Company 0.04% Oct 1, 1998 Oct 1, 1998 1.88%
General Accident Assurance Company 3.43% Sep 1, 1998 Sep 1, 1998 -3.20%
Gore Mutual Insurance Company 0.66% Aug 1, 1998 Sep 15, 1998 -0.50%
Guarantee Company of North America 0.78% Sep 1, 1998 Sep 1, 1998 -5.00%
Liberty Mutual Insurance Group 3.23% Jul 1, 1998 Jan 1, 1999 0.00%5
Lloyd's Non-Marine Underwriters 0.81% Jul 1, 1998 Aug 1, 1998 -3.30%
Lombard Canada Ltd. 1.98% Jun 1, 1998 Oct 1, 1998 0.00%2
Lombard Canada Ltd. (Group Business) 0.03% Jun 1, 1998 Oct 1, 1998 0.00%2
Lumbermen's Mutual Casualty Company 1.34% Apr 15, 1998 Jun 1, 1998 -3.16%
Motors Insurance Corporation 0.26% Jun 1, 1998 Jun 1, 1998 0.00%5
Motors Insurance Corporation 0.26% Aug 1, 1998 Aug 1, 1998 -4.60%
Pafco Insurance Company 1.35% Jul 1, 1998 Jul 1, 1998 -13.00%
Pilot Insurance Company 5.53% May 15, 1998 N/A 0.00%3
Portage La Prairie Mutual Insurance Company 0.09% Aug 1, 1998 N/A 0.00%5
RBC General Insurance 0.00% Jul 6, 1998 N/A 0.00%4
Royal & Sun Alliance Insurance 4.03% May 11, 1998 N/A 0.00%5
Royal & Sun Alliance Insurance 4.03% Jun 1, 1998 Aug 1, 1998 -0.80%
Royal & Sun Alliance Insurance 4.03% Jul 15, 1998 Sep 15, 1998 0.00%3
Sovereign General Insurance Company 0.00% Jul 1, 1998 N/A 0.00%1
Waterloo Insurance Company 0.09% Jun 1, 1998 Aug 1, 1998 -0.04%
Waterloo Insurance Company 0.09% Jun 15, 1998 Aug 15, 1998 -0.80%
Western Assurance Company 0.57% Jun 1, 1998 Aug 1, 1998 0.00%3
York Fire & Casualty Insurance Company 0.48% May 15, 1998 Jul 1, 1998 0.00%3
Zenith Insurance Company 0.17% Apr 24, 1998 Jun 15, 1998 -4.78%
Zenith Insurance Company 0.17% Sep 15, 1998 Sep 15, 1998 -1.10%
Zurich Indemnity Company 0.13% Jul 1, 1998 N/A 0.00%5
Zurich Insurance Company 4.85% Aug 1, 1998 Sep 25, 1998 -0.10%
Total Market Share 57.59% a a a

1 These filings dealt with the introduction of a new rate program.
2 These filings dealt with the introduction of CLEAR.
3 These filings dealt with rating rule changes with no overall impact.
4 These filings dealt with the introduction of a rate program for a newly licensed automobile insurer and CLEAR.
5 These filings dealt with the modification of existing group rate programs.

Financial Services Commission of Ontario
July 1998