A report published by the Canadian Insurance Institute (CI) on Thursday shows that the cost of coverage will rise significantly by 2020, when new auto policies come into force.
The report says that between 2016 and 2020, the average monthly premium will increase by 3.6% for those with new policies, and by 8.7% for older ones.
The average premium for the top 20% of Canadians with a $1m to $2m ($20,000 to $30,000) policy will increase from $1,200 to $1 and for the middle 20% from $950 to $960.
The rate of increase is not as pronounced for older policy holders, however.
Between 2015 and 2020 the average premium is expected to increase by just 1.4% for the average policy holder.
The CI report shows that even those with a higher annual household income ($50,000 or more) will see their monthly premium increase by 2.4%.
The average annual premium increase for those earning $10,000-$20,0000 ($40,000-50,00) is expected by 4.5%, and for those making $10 million-$50 million ($70,000 – $120,000).
The report is based on data from CI’s Automobile Policy Survey, which is conducted annually by the Insurance Bureau of Canada.
The CI report was released the same day as a new report from the Canadian Centre for Policy Alternatives, which found that the average premiums paid by car buyers have doubled since 2007.
The Canadian Centre said that between 2009 and 2020 premiums rose by an average of 16% a year.