How to read an FSRA auto rate filing

TopRates.ca is educational. Quotes are not offered or arranged on this site today. Nothing here is advice for your situation — it is the plain-English background to bring to a licensed insurance professional.

An approved rate filing tells you the average change an insurer has been allowed to make to its private-passenger auto rates in Ontario. It does not tell you what your own renewal will do. Those are different numbers, built from different things, and reading a filing well means knowing what the regulator actually approved, how the approval process works, and why an approved average can be positive while your premium falls — or zero while yours rises.

In Ontario, an insurer cannot simply set its own private-passenger auto rates. Under section 3 of the Automobile Insurance Rate Stabilization Act, 2003, an application for approval of rates and the risk classification system — the "rate filing" — must be in a form approved by FSRA and filed with the information, material and evidence FSRA specifies, and every insurer writing private-passenger auto insurance must have its rates and risk classification system approved or authorized by the regulator. The glossary entry on FSRA covers who the regulator is.

A filing is therefore an actuarial argument. It sets out the rates the insurer wants to charge, the system it uses to sort drivers into risk classes, and the evidence that the result is justified. The regulator's filing guidance lists what has to be in it: a certificate from an officer and a certificate from an actuary; the rating algorithm; the base rates, the differentials for each rating variable, and the discounts and surcharges; a final-rates section giving the rate-level impact of each proposed change and of all changes combined, by coverage and for all coverages together; and information on optional accident benefits for the most recent accident year.

The streamlined route is what FSRA calls a Standard Filing, under its guidance AU0126APP, effective October 9, 2019. FSRA describes it as implementing a modified "file and use" approach to reduce regulatory burden. A filing qualifies for the Standard route only if the proposed overall rate-level change is 5.0 per cent or less, calculated on a capped and uncapped basis; the changes do not produce a rate increase of more than 15.0 per cent for any one customer at renewal, which insurers may use capping to achieve; and FSRA has approved a Major Filing from that insurer within the last three years.

The Standard route also comes with a clock and a boundary. FSRA says it will notify the insurer of its decision within 25 business days of submission, and that if it does not, the filing is considered approved. And some changes cannot be made through a Standard Filing at all — changing territorial definitions and introducing new rating models among them. Those go through the regulator's fuller review.

Behind the process sit the principles FSRA states for rate regulation: a rate-adequate market in which insurers are expected to manage claims costs and expenses effectively; pricing decisions that are actuarially sound and supported by evidence; and factors that affect an individual premium, and changes to it over time, that are explainable to the consumer. That last one is the hook for the rest of this article.

FSRA publishes approvals in a public database, Auto Rate Approvals, rather than in a quarterly report. Each row shows the insurer, the insurer group, the approved rate change as a percentage, the renewal effective date and the approval date, and the list runs continuously as decisions are made. FSRA's own definition of the key column is the thing to memorise: the approved rate change shows the expected average change in premiums across all customers for private-passenger auto insurance on renewal.

Two reading rules follow. First, the effective date is the renewal date from which the change applies, which may be months after the approval date; a renewal before that date is still on the old rates. Second, the figure is an average across the insurer's whole Ontario book. It is a measurement of the book, not a forecast for any policy in it.

An approved average change of, say, three per cent does not mean your premium will rise three per cent. The average is made up of thousands of policies whose premiums move by different amounts, because a filing changes the pieces of the rating algorithm — base rates, territory relativities, vehicle rate groups, discounts and surcharges — rather than applying one percentage to everyone. A driver whose territory relativity was lowered can see a decrease inside a filing with a positive average; a driver whose vehicle rate group moved up can see an increase inside a filing with a zero average.

Three things sit outside the filing entirely. Your own circumstances change between renewals — a claim, a conviction, a new vehicle, a move, a listed driver added — and the rating algorithm prices the new facts. Capping, which a Standard Filing may use to keep any one renewal under the 15 per cent ceiling, can spread an increase across more than one year, so a renewal can carry part of a change approved earlier. And the approved figure says nothing about the premium of the coverages you have chosen to add or drop: since July 1, 2026 most accident benefits are optional, and declining or adding them moves your premium independently of any filing.

Why some areas carry higher relativities than others is a separate question with its own history; the Brampton premium gap article works through it.

• Start with the approved rate change and FSRA's definition of it: an expected average across all customers on renewal.
• Note the renewal effective date. If your renewal is before it, the filing is not yet in your premium.
• Ask your broker or insurer which components changed — base rates, territory, vehicle rate group, discounts — because the component is what reaches your premium, not the average.
• Compare the premium summary on your renewal with last year's, line by line, before assuming the filing explains the difference. Your own changes are usually in there too.
• If the explanation offered does not account for the change, remember the regulator's stated principle that factors affecting an individual premium should be explainable to the consumer, and ask again.

It does not summarise any insurer's filing or any quarter of approvals. The approvals database is the primary source and it is updated as decisions land; numbers copied from it go stale, and an average across a book is not a figure that belongs in a decision about one policy. To look up an approval, use FSRA's Auto Rate Approvals database directly.

TopRates.ca is educational. Quotes are not offered or arranged on this site today.