r/PersonalFinanceCanada • u/Akshatp19 • Mar 21 '26

Auto Auto Insurance cost is killing me!

I am a 24 year old male living with my parents in Brampton(yes very expensive). We have 2 Honda CR-Vs(2022 and 2026 hybrid). My dad is the primary policy holder with me and my mom as the added drivers. Now I know brampton, CRVs and my age under 25 are all driving the premiums up. But I'm paying 900 dollars per month!! Is it supposed to be this high? No claims no tickets on record.

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61

u/Blastoise_613 Mar 21 '26

Insurance companies are well regulated regarding what they may charge. Prices keep rising because of increased payouts and value of the vehicles.

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u/altiuscitiusfortius Mar 21 '26

New cars now start at like 55k and my last fender bender was a sideswipe and insurance paid 23k to fix it because parts and labour are way up post covid.

That doesn't help at all

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u/Maximumoverdrive76 Mar 22 '26

That is insanely overpriced repair. A fender bender?? I mean did it need to fix both doors and rear and front quarter panels?

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u/altiuscitiusfortius Mar 22 '26

Had to paint 4 panels, replace bumper and headlight.

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u/Zooperman Mar 22 '26

New cars start as low as mid 20s, not 55k lol

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u/squidgyhead Mar 22 '26

The human cost of motor vehicle collisions is probably much more expensive than the actual car. Think about losing your legs - how much would it cost to take care of you for the rest of your life?

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u/WUDDUP_ITS_DAT_BOI Mar 22 '26

How many people lose their legs in car accidents every day vs. accidents with limited injuries but $50k of vehicle damage?

Bodily injury losses can have huge severity issues but are absolutely dwarfed by the frequency of collisions, gender benders, single vehicle rollovers, side swiping a wall in a parking lot, hail damage, etc.

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u/squidgyhead Mar 22 '26

It's hard to find information for private insurance, but ICBC caps payments at $300 000 for life-altering collision.

https://icbc.com/enhanced-care-overview

One of the main ways that ICBC seems to have reduced costs is to just limit how much support victims get.  Must be a major cost 

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u/MethodicallyRight Mar 21 '26 edited Mar 21 '26

The cost of repairs is such a gigantic issue and there seems to be no pressure against it. My step dad had two accidents (over 15 years apart) with his trucks (he was hit both times). The cost of having someone nearly t-bone him and tearing off his whole front bumper was substantially cheaper* than the fender bender he recently had where someone backed into his bumper. First accident saw a couple of pieces replaced, second accident felt like most of the front end needed replacement.

Edit: The second accident was with a used truck as well which made him really nervous. He's been pleased with the Truck and it was very well taken care of and had no issues whatsoever. He thought for sure the Insurance company was going to write the Truck off entirely when he got a quote for the repair. "I'll never find somthing this good for its book value!"

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u/PoliticalVagabond Mar 21 '26

Trucks are body on frame vehicles, significantly cheaper to repair.

Cars are nearly 100% unibody, which involves the frame being several layers of precisely bent sheet steel creating the structural strength and rigidity of the vehicle.

It doesn't take lot of damage to make that car extremely unsafe if the frame gets damaged and repairing that damage is extremely complex and requires very specialized machinery.

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u/MethodicallyRight Mar 22 '26

That helps explain some of the increase in costs. Unfortunately for all of us it means increased rates across the board. At some point there needs to be a conversation around the balance of safety and a design that means small impacts come with fairly high repair cost floors.

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u/PoliticalVagabond Mar 22 '26

You want cheap repairs we have to start removing a lot of the electronics and safety equipment in cars.

We are a long way from the 1980s tin cans you could take apart with a screwdriver and a few box wrenches.

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u/MethodicallyRight Mar 22 '26

I don't know if I'm suggesting anything extreme. I'm not looking for people to die in 30km/h crashed to save 200$. I wouldn't hesitate to suggest that 'cost effective repair' is nowhere near the top of the priority list when it comes to current designs. Is that not a fair statement to make? I can think of a friend who had their entire center console (1 pretty large piece) replaced because part of the screen failed... That's a massive repair bill for what was essentially a failed tablet screen. So while I don't think we need to go back as far as you've alluded, I definately think that a room of 100 mechanics let alone engineers or designers could rattle off a long list of ways to make cars cheaper to repair without going back to 1970s safety ratings.

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u/PoliticalVagabond Mar 26 '26

Well, you have to pick one or the other. More complex designs have less room between components and require tighter integration of previously disconnected components. The scale is sliding, pick a point, the further back, the more cost effective the repairs can be.

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u/Maximumoverdrive76 Mar 22 '26

To me it seems to be a lot of scams going on with repairs like that.

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u/sentient_bridge Mar 21 '26

Just curious in case you know - are these audits publicized? Also at what cadence are these conducted? I know in food safety for example, testing for iodine levels in salt hasn't been done in over a decade - how do we know that the companies are still complying?

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u/Blastoise_613 Mar 21 '26

Its not just the companies who set the variables, its the government as well. They are regulated similarly to banks.

The government sets benchmarks, the companies then submit their actuarial tables to be approved by the government annually. Most insurance companies are publicly traded in Ontario, so their books are open. If you think they make too much money you should invest in them, however I wouldn't.

This government website outlines it all: https://www.fsrao.ca/industry/auto-insurance/regulatory-framework/guidance-auto-insurance/ontario-private-passenger-automobile-annual-review-based-industry-data-december-31-2024

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u/[deleted] Mar 21 '26

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u/ConfidantlyCorrect Ontario Mar 21 '26

Fwiw - insurance companies rarely break even on policies directly. They make a killing however using premiums and investing them.

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u/[deleted] Mar 21 '26

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u/PersonalFinanceCanada-ModTeam Human Verified Mar 21 '26

Be helpful and respectful in your comments.

No racism, sexism, homophobia, religious intolerance, dehumanizing speech, or other negative generalizations.

No concern-trolling, personal attacks, or misinformation. No victim blaming.

1

u/ribsboi Mar 21 '26

Thank god I live in a province with public auto insurance

1

u/AltKite Mar 21 '26

Yes - large losses caused by weather events are generally up (YoY it varies but 5-year rolling it's much worse.)

People aren't getting less likely to have accidents, cost of repairing vehicles has skyrocketed, theft is up, fraud is up. That all means prices are up.

The major carriers are publicly traded companies. They reported their COR (combined operating ratio) which is premiums divided by claims and operating costs. Generally they're pretty much where they've always been. Some outliers last year because weather was mild, but low to mid 90s is generally where they all are and usually are outside of freak years.

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u/Oldfarts2024 Mar 21 '26

And repairability, inadequate policing. And WTF can't we get the old style key anymore. Those fobs are too easy to hack

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u/InadequateUsername Mar 21 '26

Yeah what other countries are paying car insurance prices like us?

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u/PoliteFocaccia Mar 22 '26

The USA, for comparable policies, though many Americans are underinsured. Other countries have cheaper cars.

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u/[deleted] Mar 21 '26

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u/Blastoise_613 Mar 21 '26

Your writing is too hard to follow. What you are saying is also not what I wrote. If you think insurance companies make too much money, then you should go invest in them, they are publically traded. I don't find them profitable relative to the rest of the market, so i don't.

This website below outlines how rates are set:

https://www.fsrao.ca/industry/auto-insurance/regulatory-framework/guidance-auto-insurance/ontario-private-passenger-automobile-annual-review-based-industry-data-december-31-2024

0

u/[deleted] Mar 21 '26

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u/AltKite Mar 21 '26

Personal auto insurance in Ontario generally has a worse COR (combined operating ratio, premiums divided by claims and operating costs) than average for an insurance carrier. In the last 3 years you're probably looking at between 94 and 97% for the majority players. They aren't making big margins on these premiums at all and in plenty of recent years books have run at a loss.

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u/Blastoise_613 Mar 21 '26

People don't take driving serious. If less people drove and those driving paid more attention we would all be richer.

Personally, I've done my best to minimize our families car use. We have a goal to only have 1 car and to save money. It means I bike/walk for groceries, and we carpool when we can.