In an effort to fulfill their 2013 promise to Ontarians to lower their car insurance premiums by 15%, Ontario’s Liberal government is altering the current insurance system, in hopes of decreasing insurance fraud.
According to Aviva's 2017 Fraud Report, it’s estimated fraud costs Ontarians $700 million to $1.6 billion annually, by far the highest provincial number in Canada. Fraud is a large contributor to Ontarians paying the highest insurance premiums in the country.
It is estimated that 10-15% of insurance premiums goes towards covering fraudulent insurance activities.
The proposed change of the insurance system will have multiple new steps. There will be standard treatment plans for common injuries from collisions, such as whiplash and sprains. There will also be examination centres for medical assessments of more serious injuries. Lastly, a Serious Fraud Office will be opened, which will include staff from the Ontario Provincial Police. (Insurance Business Magazine).
‘’Auto insurance fraud has become an industry,’’ Charles Sousa, Finance Minister of Ontario, said. ‘’It’s time to stop it. If you know someone who has been engaged in this crime, let the Serious Fraud Office know. They will pursue and investigate these fraudsters and bring them to justice.’’
Common types of insurance fraud include:
- Sales of stolen vehicles
- Auto repair shops billing additional damages
- Intentional/suspicious collisions
- Incorrect medical billing
- Forging signatures of clients relating to medical or repair expenses
‘’It is unfortunate that these different types of fraud have become so rampant,’’ Lance Miller, CEO of Surex, said. ‘’The hardest part for insurers is trying to stay one step ahead of the fraudsters. These new steps – specifically the Serious Fraud Office – should be a strong deterrent and, hopefully, will temper these criminal behaviours.’’
The Serious Fraud Office will be opening in the spring of 2018.
