According to Kanetix, a major Canadian car insurance marketplace website, the cost of Ontario car insurance quotes has fallen by about 2.8 percent in the last year. Before Ontario drivers begin celebrating, though, they should be aware that in this case, the reasons for the decrease are a bit more complex than a simple decrease in insurance costs. Changes in consumer habits and people looking to save more money on car insurance have likely driven the drop in car insurance rates, rather than more forgiving or competitive insurance companies.

One of the possible reasons for the decrease is the high level of unemployment in the Ontario area for younger drivers. Younger drivers, especially males, tend to have higher car insurance premiums, as they’re one of the most risky groups for insurance companies to insure. Incidences of accidents tend to be high among this group of drivers. The unemployment rate may indicate that young drivers are simply unable to afford cars and car insurance. Their driving less leads to less accidents, and therefore car insurance claims, resulting in the overall drop in car insurance rates. Unfortunately, this also means less drivers on the road — a bad thing for car insurers. This means they’re insuring less vehicles and taking in less money overall.

Drivers are also taking advantage of various options to lower the premiums on their existing policies. For instance, older cars tend to cost less to insure as their value goes down. Ontario drivers are holding onto their cars for longer, and taking advantage of optional discounts. They’re also lowering the amount of car insurance coverage they pay for. The average cost of car insurance therefore goes down, but so does the amount of coverage being provided by an auto insurer. This doesn’t do much for drivers, though it does show that the insurance companies have taken a hit during the current recession. Car insurance companies handle losses in revenue several different ways, but generally tend to offer lowered, more competitive car insurance quotes to customers. Though this hasn’t showed up in the current numbers, it may be possible a ways down the road.

Even though the current insurance decrease may be misleading, drivers can often negotiate lower premiums by speaking with their car insurance representatives. By doing comparison shopping online beforehand and pointing out a good driving record to insurance reps, Ontario consumers can often cut huge percentages off of monthly payments. Ultimately, it’s down to the individual driver to get lower rates, but the current decrease does show that insurance companies may be more open to negotiation of car insurance quotes, and to keeping premiums low for safe drivers around Ontario and around the country.