Amendments to the Private Passenger Automobile Filing Guidelines - Major, Technical Notes and Benchmarks

No. A-10/14
Property & Casualty
To the attention of all insurance companies licensed to transact automobile insurance in Ontario

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The Financial Services Commission of Ontario (FSCO) is releasing updated Private Passenger Automobile Filing Guidelines - Major, Technical Notes, and benchmarks for automobile insurance rate and risk classification system filings.
This Bulletin also outlines the new requirements for submitting applications for approval of automobile insurance rates and risk classification systems to FSCO. 

Changes to Filing Guidelines and Technical Notes

The Private Passenger Automobile Filing Guidelines - Major and Technical Notes have been updated to reflect changes identified over the past year as a result of review of filings.  For example, the models now include filing requirements for Usage-based Insurance Pricing (UBIP).
Also, FSCO has implemented a Return on Premium (ROP) rather than Return on Equity (ROE) approach for its review of rate filings.  Changes to the Filing Guidelines and Technical Notes have been made accordingly.
The Technical Notes have revised benchmarks, including the analysis of loss costs trends and auto reform adjustment factors based on Ontario industry private passenger data to December 31, 2013 from the Automobile Statistical Plan. Insurers are reminded that this analysis is based on the distribution of risks Ontario-wide.  In determining appropriate factors to use, insurers should consider the differences in the distribution of risks for their own portfolio as compared to the Ontario-wide analysis.
Attached is a list detailing the changes to the Guidelines and Technical Notes.  FSCO reviewed these changes with its industry advisory committee.


All insurers must use FSCO's electronic filing system – ARCTICS – when submitting rate and risk classification system filings.  FSCO is making changes to ARCTICS to reflect the revised filing requirements.


For inquiries regarding this Bulletin, please contact your Team Lead/Analyst in the Automobile Insurance Services Branch at FSCO.  On matters concerning actuarial requirements, company actuaries may contact FSCO’s actuarial staff directly.
Please note that this Bulletin, the Guidelines, Technical Notes, benchmarks and rate profiles are posted on FSCO’s website at 
Philip Howell
Chief Executive Officer and
Superintendent of Financial Services
October 3, 2014



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