According to the IBO, policy renewals will default to the coverage limits that were in place prior to July 2026 when the reforms take effect. (Credit: NATHAPHAT NAMPIX/Adobe Stock)
Ontario is implementing major reforms to its auto insurance system, including a shift toward an à la carte model for coverage. This move aims to allow drivers more flexibility with their coverage and premium budget, but some are concerned the changes may only further confuse insureds.
When Ontario's auto reforms become active in July 2026, most currently required Statutory Accident Benefits (SABS) will become optional. Only medical, rehabilitation and attendant care benefits will remain standard in auto insurance policies. If drivers want to include additional SABS like coverage for lost wages, caregiver expenses and death benefits, they will need to opt in to those with their carrier.
This move allows insureds to tailor their coverage to their needs, and to avoid paying for coverage they receive through means outside of their auto policy. However, some critics argue that this new system will only complicate the insurance process further for insureds who already may not fully understand their policy, which could leave coverage gaps.
"While the promise of lower premiums may sound appealing, the reality is that drivers could end up paying more to maintain the same level of coverage they currently have," M. Steven Rastin, Senior Counsel at Gluckstein Lawyers, said in a release. "Those who opt out of certain benefits to save money may find themselves financially vulnerable in the event of an accident."
Outside of allowing customized coverage, the Insurance Brokers of Ontario report that the Canadian province’s reforms will also make auto insurers the first payer when a car accident happens, which, it explains, will stop claimants from having the requirement to first exhaust collateral benefits.
IBO also explains that policy renewals will default to the coverage limits that were in place prior to July 2026 when the reforms take effect, and consumers will need to speak with their agent or broker to opt out of any undesired, optional coverages.
The IBO also reminds brokers of the key role they will play in helping auto insurance customers understand and navigate these policy reforms.
In an article for The Ontario Broker Magazine, IBO Board Member Sam Jazayeri wrote, “While July 2026 may seem like a distant date, the time to get informed is now—brokerage managers must begin preparing training programs and documentation processes to capture client coverage decisions, front line team members need to refamiliarize themselves with existing SABS coverage to effectively compare current coverage to new offerings. Brokers are already well positioned to help consumers navigate the complexities of auto insurance, and next year’s Auto Reform is the time to reengage with our clients in a meaningful way, evaluate their insurance needs and win their business by winning their trust.”
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