Important Information

Greater Toronto Area (GTA) & Car Insurance

Today we are going to discuss car insurance premiums in GTA. This should not come as news to many that GTA is by far the most expensive region in...

Read more
Self-Driving Cars In Ontario

Ontario Transportation Minister Steven Del Duca recently announced that Ontario will allow companies to test Driver-less cars on its roads,...

Read more

10 things you must do after a car accident:

Personal Help Request
Take our free initial consultation
Tell us more about you problem

Mandatory winter tire discounts on your car insruance premium

Winter TiresIn an attempt to help lower insurance rates for Ontarians, new winter tire discount rules have come into effect. For drivers renewing their policies on or after January 1, 2016, insurers will be required to provide insurance discounts for those who install winter tires on their vehicles. It is believed that such discounts will provide an incentive to install winter tires, which will reduce the number of collisions and in doing so, reduce insurance rates as well.

To obtain the discount, all four tires must be winter tires. The government has noted that consumers should specifically look for tires marked with a logo of a peaked mountain and a snowflake to ensure eligibility. All season and all weather tires will not be eligible for the discount.

Further, discounts will only be available upon the renewal of the policy, which means that many will not be able to realize immediate cost savings in rates. For example, a driver who installs winter tires on their vehicle on January 20, 2016, but whose policy does not renew until December 20, 2016, will not be able to take advantage of the discount until this date. For those individuals who find themselves in this position, the government has encouraged those interested in purchasing winter tires to “shop around” in order to take advantage of the discounts immediately. However, before deciding to switch insurers, it is important to note that although a discount is now mandatory, an actual discount rate has not been set. It is estimated that the discount will be anywhere from 3-5%. As many have pointed out, as it takes about $1500-1600 dollars to insure a vehicle in Ontario, a 3-5 % discount on one’s collision portion of the policy will be a savings of around $75-80 per car, per year. Considering further that a set of four snow tires can cost anywhere from $400-$1100 depending on the quality, it would take years to see any real savings.

Considering these points and the fact that almost half of car insurance providers in the province already offered discount rates for winter tires, the cost benefits of this new policy will likely be insignificant for a majority of drivers. However, the decision to purchase winter tires should be a fully informed one, and it must be mentioned that although drivers will likely not seeing great savings in costs, numerous studies have shown that winter tires have been proven to help traction, handling and shorten braking distances compared to standard and all-season tires. For these reasons, regardless of cost savings, many drivers decide to install winter tires and other provinces and countries have even gone so far as instituting mandatory winter tire policies.