• Fri. Dec 8th, 2023

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NDP plans to ban postal code rating for auto insurance

Editor’s Note: The Conservative government outlined its plans for insurance in their budget document, released before the Ontario election, which will take place June 2. Canadian Underwriter is asking Ontario’s political parties for their platforms on insurance. We are printing the results as we receive the commentary.


With Ontario’s upcoming provincial election, the NDP have expressed their plan to end the practice of charging higher insurance rates based on customers’ postal codes.  

In their platform to make auto insurance affordable for Canadians, the NDP say they will “stand by the consumer,” Brampton North NDP candidate Sandeep Singh tells Canadian Underwriter.  

The NDPs commitment to achieve cheaper auto insurance for consumers includes the following campaign platform:  

  • Ban postal code discrimination so “nobody is gouged” on auto insurance because of where they live. 
  • Explore every avenue possible for bringing down auto insurance rates and improving service.  
  • Enforce transparency and “put drivers first” at Ontario’s auto insurance regulator, the Financial Services Regulatory Authority (FSRA). 

“In communities like Brampton, a driver will pay premiums nearly twice as high as a driver with the same driving record in other parts of the GTA. That’s not fair,” the platform reads.  

As a Bramptonian, Singh says he has witnessed the unfairness of territorial rating.  

“Bramptonians are frustrated with rising monthly premiums,” he says. “Even if my driving record is good, I would still have to pay for higher auto insurance, which doesn’t make sense at all.” 

Historically, Brampton has been the most expensive city in Ontario for car insurance, although in 2021 it dropped to fourth place and was succeeded by Vaughan.  

Across Ontario, the average auto premium last year was $1,555 — a 3.8% decrease from 2020, when the average was $1,616, according to data from Ratesdotca, previously reported in Canadian Underwriter. 

“What we are looking to do is, we will ban postal code discrimination so nobody is gouged on auto insurance because of where they live,” Singh says. “No one should be penalized just because they live in Brampton, or some other location.”  

But if the territorial rating system is abolished, would driving record be up for consideration as a rating variable? 

“We need to explore every avenue possible for bringing down auto insurance rates,” Singh says in response. 

How the NDP plans to ban territorial rating remains to be seen. Singh says the NDP will release a “full-fledged plan” in the next few days on how they will address auto insurance rates.  

“The agenda is that everyone living in Ontario should be considered one,” he says. “Not because someone is living in Brampton, has the same driving record, has similar car, is paying much more because he’s living in Brampton. That’s not right.”  


Ontario NDP Leader Andrea Horwath speaks to the media before visiting communities across the GTA, as part of the 2022 Ontario election campaign trail, at Queen’s Park in Toronto, on Wednesday, May 4, 2022. THE CANADIAN PRESS/ Tijana Martin


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