Our auto and home insurance renewal documents arrived in the mail the other day. Last year, the cost to insure our two automobiles went up by 22 per cent and the cost to insure our home went up by 14 per cent. And when I replaced our rusty old 1992 Accord with a shiny new (relatively speaking) 2004 Accord, our auto premiums went up another 31 per cent (a part of this increase was due to the addition of comprehensive coverage). So, when our auto and home insurance renewal documents arrived in the mail the other day, I opened the envelope with some trepidation. I was hoping that 2011 wouldn’t see a repeat performance. Unfortunately, I wasn’t so lucky.

The news isn’t so bad on the auto insurance front. The changes to new and renewing auto insurance policies implemented in Ontario beginning September 1, 2010 meant that our auto premiums went up by just 7.6 per cent. The smaller increase is a direct result of a decrease in benefits for car owners who are injured in an auto accident. For example, medical and rehabilitation benefits for non-catastrophic injuries have been reduced from $100,000 to $50,000. The good news is that I was quickly able to eliminate the premium increase by boosting the deductible on direct compensation.

Home insurance turned out to be a different story. The premiums went up by 28 per cent for exactly the same coverage and same situation (no claims in the past year). I was able to get a 6 per cent discount for running what Belair Direct calls a home diagnostic (once again, showing that there is real money in some of the bill insets, so at least take a glance before chucking them away), which still means a premium increase of 20 per cent. Insurance companies are blaming increased payouts for wind and water damage due to climate change for the increase in home insurance premiums.

This article has 36 comments

  1. Benefits for ALL Ontario car owners injured in an auto accident were radically cut as a result of recent changes in the government mandated Ontario car insurance policies. Some benefits were completely eliminated, some cut by 50%. The insurance premiums still went up, mine is up 15%! To me this is the largest car insurance premium hike in several years. When I first heard about the upcoming changes being implemented by the government I was thinking about buying less coverage and paying less. Boy, was I naive :( !!

  2. Wow – the “reason” cited here (home insurance) is a crock!

    Will you shop around CC? We shopped last summer after buying our new car and moving into a new house and managed to saved about $10/mo on the car (oddly we went from a 2002 to a 2011) and over $60/mo on the home insurance.
    I told my Dad about the company and he is now saving over $110/mo on his home and auto insurance .
    I won’t plug the company here but drop me an email if you’d like to get the name and if you so choose edit this response w/ the company name later.

    • It’s now 2013 and I’ve just got my home insurance renewal: up 50% from my 2011 cost

      I have a problem getting Insurance companies to cover me in my home since I have University and/or College students stay with me.

      Also, my Honda (1999) and still going strong is what they dub “branded” since it was repaired after a wreck. So most Insurance companies don’t want me! Ironic isn’t it. They probably would not give me anything for the car and yet I value it highly. It’s a great six cylinder top of the line (then) Honda.

  3. I have found Belair Direct to be more expensive than some other companies – shop around and you’ll find MUCH better deals for both home & auto.

  4. Here in New Brunswick, many home insurance policies have seen similar increases. Last year my policy went up by 19%, followed by another 30% this year for a total of 55% over two years.

  5. Car insurance rates were the biggest surprise for me when I moved from Alberta to Ontario. I don’t really understand how families of average income can afford to drive in this province. Even for a used car, taking into account depreciation, insurance, maintenance, etc., it’s pretty hard to project to spend less than $8k a year on a vehicle, which is somewhere in the neighborhood of $11.5k in pre-tax income. I ended up getting rid of my car, but this is not an option for everyone.

  6. Definitely shop around. I just had the bill for condo insurance and it had gone up by almost 25% even though I’m claim free — they cited some new coverages for sewer and ground water damage, which is a bit strange considering that I live far above ground level! I did a bit of looking and found the same coverage for less than I paid last year.

  7. As other say, shop around! I had the exact same experience with Belair Direct coverage increasing year over year with a 21% increase in auto premiums in one year and 25% increase in home over two years (despite a small discount with the home diagnostic questionnaire). After getting some quotes I switched companies and got my premium back down to the same level it was a year ago.

  8. I’m definitely going to shop around. I used to be with Co-operators before and one year when I shopped around, I found Belair to be 1/3rd cheaper on auto and slightly more expensive on home. So, I switched. With all these increases in the past couple of years, I’m now paying more than I used to with Co-operators.

    I’m going to check out Co-operators again and a few other companies. I’ll keep you posted on what I find.

  9. Don’t forget Meloche Monnex, P.Eng or alumni discount.

  10. Don’t forget to check into affiliation program discounts with various insurance companies. I’ve found insurance discounts available both through my university alumni association (the code is advertised in the alumni magazine) as well as from my professional association (again, the ad with the code was in the association’s magazine). I actually managed to achieve a significant discount on my auto insurance this way last year.

  11. I’ve used State Farm for my entire working life (20+ yrs), using them when I lived in New Brunswick, New York, Ontario and Indiana – and they now give me a discount for being a long time customer. I tried shopping their premiums a few times in the past and although I found some places to be slightly lower, it wasn’t enough of a discount to motivate me to switch.

    But I mainly only liked State Farm because their agents were usually very local to where I was and I can always go to talk to a human being face-to-face about things. And they were more than happy to help the few times I had to make claims. So, sometimes you also have to consider the service you get.

    Just my two cents worth…

  12. We just received our renewal policy notice on our property insurance. The premium went up by 2.9% from last year. We are with a broker (Hub International Ontario Limited) that supplies insurance through Traders General which is part of the Aviva group. I always look at tthe premiums and discounts each year and if the increase is too great, start to shop around and then go back to my current insurer and ask them to match it. They have always done this. We have had no claims in the past on property, and minimal on auto. Great service in the past with this group.

  13. My 2011 premiums went UP for my home insurance and down for my (old) auto insurance. The net effect was a 10% increase.

  14. House insurance goes up in part because the insurance company automatically inflates the rebuild costs of your home every year. Call them to check the assessment. TD had ours costing $80k more than last year. There was no way. Turns out the building costs were less than indicated, remember your insuring buildings and contents, not land. Don’t pay to insure your lot! Many people like myself don’t realize this. If your house sells for 300k, your building may only be worth $100k We were able to get our property adjusted back down to a realistic amount and our insurance went up $1 without touching the deductible.

  15. @Will: Great tip. Will keep in mind. Our life insurance almost doubled and our broker told us it’s because with Life Ins. as you get older they assume that you wont want to go through the trouble of qualifying again. When he checked around he found a comparable policy for 1/2 the cost. Since we were hoping to increase our coverage this worked out and while the re-tests are a pain it’s the worth the money saved.

    @Phil S: Agreed. I’ve been with the same broker my entire life thanks to my parents who were with them before that. Our family has gone through 2 ownership changes in the same broker. We do shop around to be prudent (commonsense) but they always manage to meet the competition. I avoided a big increase with an accident many years ago based on our ‘client loyalty’. This was before accident forgiveness clauses were so popular. Do your legwork but also check with your current company to see what benefits come with staying put…and let them know your looking around and why.

  16. My last sentence was a general comment/ observation not directed to Phil. ; )

  17. Okay, I’ve already tried Meloche Monnex. Pretty much same premiums as Belair Direct.

    Also, tried State Farm. Website crashed on me midway through the quote request.

    Still on my plate, Co-operators and RBC.

  18. +1 for TD Meloche Monnex. Although one usually sees a benefit to group their home and auto insurance, I found I got a better deal with two different companies. My husband gets a discount for auto insurance through his employer and our home insurance was 40% lower by using MM.

  19. I recommend renting. I’ve doing it for 6 months now and never looked back.

  20. ‘Climate change’ claims- what a load of crap.

  21. I remember when my car insurance went up because of 9/11. 9/11 did a lot of things, but it didn’t make my likelihood of an accident increase, the cost to repair an accident increase – but that was their way of passing on a price increase.

    No different here with ‘climate change’.

    unfortunately, without enough carriers to force competition – there is little that can be done

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  23. I just applied for insurance on a new car. My insurer wanted $2,600/year. I shopped around, and got $1,200/year via BelairDirect, locked in price for next year too (no increase).

    In general, insurance premiums will also be going up because of the poor returns available in bonds and other safe investments for insurance companies. Insurance companies hold and invest your premiums, this is called “float”. A good return on “float” can held subsidize the rates they charge their customers.

  24. My auto was up, I shopped around and saved about 10% with AMA. Not sure what to do about the home insurance. ARG!

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  29. We’ve had good luck, great service and competitive rates with Johnson Inc.

    It’s worth getting a quote I think:

    http://www.johnson.ca/

    Again, like others have said, let us know the outcome.

    Cheers,
    Mark

  30. Johnson was $800 more expensive for auto. Didn’t check home after seeing that figure.

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  32. Thanks for the diverse tips provided on this web site. I have seen that many insurance providers offer prospects generous savings if they favor to insure a couple of cars together. A significant variety of households have several vehicles these days, especially those with more aged teenage kids still located at home, as well as the savings in policies could soon increase. So it is good to look for a bargain.

  33. For the years 2008, 2009, 2010 and 2011, the insurance for my 2 rental houses has gone up 9%, 10% 19% and 45%. I have never made a claim at Intact. I’ve checked into other companies and they are doing the same. Is there any limit to how much they can increase my rates?

  34. Where is our government to protect us from exhorbitant insurance fraud and constant rise in premiums with no upgrade to services. In fact, service is lousy, what you get covered for – SHOULD something happen is always questions to the point of wanting to slit your wrists if they make you jump through more hoops to actually make a claim. WHEN WILL WE ALL WAKE UP AND DO SOMETHING ABOUT THIS – HOW MUCH DOES IT TAKE TO SAY ENOUGH AND ACTUALLY GET SOMETHING DONE ABOUT IT! Where is our government to step in and say – NO – we will require a capping on insurance rates and premiums with NO upcharge to claimants who haven’t filed for anything in the last 5 years.

    WAKEUP – SEND YOUR COMPLAINTS TO YOUR LOCAL MLA’S LET’S DO SOMETHING ABOUT THIS FROM THE BACK END, GET OUR GOVERNMENT INVOLVED, THEY NEED TO EARN THEY’RE PAY CHEQUES TOO!

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