How Ontario brokers, insurers need to prepare themselves — and their clients — ahead of auto reform

Ontario’s 2026 auto insurance reform will turn the standardized auto insurance product into a modular benefits model. That means brokers will need to spend more time with each customer explaining their options and ensuring they’ve made an informed choice, says Jullie Hands, partner of insurance business consulting at EY Canada.

“It is going to be a big shift in the approach to selling personal auto insurance,” says Hands. She spoke to Canadian Underwriter about EY’s newly published report on Ontario’s 2026 auto insurance reform. 

Starting July 1, 2026, Ontario auto insurance will make changes to its Statutory Accident Benefits Schedule (SABS). Under the new reform, medical, rehabilitation and attendant care benefits will be mandatory. But all other accident benefits, including income replacement, caregiver, housekeeping, non-earner and funeral benefits, will become optional. 

Under the new model, policies will automatically renew with existing coverage unless consumers choose to remove optional accident benefits. 

For brokers, that presents an opportunity to explain the cost implications of removing benefits and help consumers understand the possible trade-offs they’d be making to their safety and protection.  

“The role of the broker or the insurance company — depending on who [the customer] is dealing with at point of sale — is to really educate them and actually help illustrate what the impact of some of those decisions could mean,” says Hands. “They have to spend more time with every individual customer to actually explain the choices and make sure that informed decisions are being made.” 

And in the event of inquiries or disputes where a customer removed coverage and then finds themselves in an accident where they need but don’t have benefits, brokers will have to provide documentation to ensure every choice was clearly explained.

“That might then be a face-to-face discussion with a client where they can manually document a conversation,” or even record their phone calls, says Hands. “They can present policyholders with printed illustrations of what different scenarios could look like.”

But with many insurance transactions now being digital, brokers must also “be thinking about building scenario optionality into the portals that they use, with very clear audit trails around coverage selection.”

This will support broker compliance and accountability but also assist the customer in their decision-making journey if they can see in real-time how their choices affect coverage and pricing.

Readying insurer operations 

Every operational function for insurers, including pricing, underwriting, claims, distribution, IT and compliance, will be affected by this upcoming reform, EY’s report says.  

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“There’s a lot of internal prep work that insurers have to do to be ready for it. They have to revisit their pricing models,” Hands explains.  

“They have to think about what the price [of each benefit] is relative to every single coverage,” she says.  

“Where every [accident benefit] was bundled before, now, what does it actually cost if I want to take income replacement out or add income replacement in?” she poses. “Even insurers with very sophisticated pricing models, do they have the granular claims data to really map to those individual coverages?” 

Insurers will need to review and refresh consumer-facing and internal materials, such as policy wording, product filings, broker scripts, job aids and training guides to reflect the new model.  

Plus, the reform replaces private health plans in the coverage hierarchy by positioning auto insurers as the first payer for medical or rehabilitation claims, with the exception of medication expenses. 

“This will allow consumers to preserve their workplace benefits for other life events. This change means insurers must take on new roles and responsibilities, but it also opens the door for them to stand out and earn their customers’ trust,” EY’s report reads.  

Education for the nation 

Fortunately, insurers and brokers aren’t being left to their own devices as they prepare for these changes.  

Financial Services Regulatory Authority of Ontario (FSRA), which oversees insurers, has developed a toolkit of standardized communication resources that includes a customer letter, email template, and Q&A to ensure consistent and clear messaging throughout the transition. 

The Insurance Brokers Association of Ontario also has updated training modules to support brokers as they help consumers navigate these new options. 

However, more can be done to make consumers who don’t have insurers or brokers looking out for them aware and educate them about the upcoming changes and how they may be affected.  

“There is a need for more general education outside of individual customer relationships,” says Hands.  

That might serve as an opportunity for the industry to lobby government on the importance of consumer awareness campaigns.

Alyssa DiSabatino

Alyssa Di Sabatino has been a reporter for Canadian Underwriter since 2021, covering industry trends, market developments, and emerging risks.