The Ontario government has launched a review of Ontario's auto insurance system in a bid to lower rates.

One of the changes under consideration is the elimination of postal codes as a determination factor. PC MPP Parm Gill introduced the Ending Discrimination in Automobile Insurance Act last year. If passed, it would prohibit insurance companies from using location as a consideration when deciding monthly rates.

Insurance experts are raising the alarm, saying although eliminating postal codes could lower rates in bigger cities, it could increase them for smaller ones.

"Someone in Ottawa is paying considerably less than someone living in Brampton or Scarborough," said Anne Marie Thomas of

"If the province says that insurance companies no longer use postal code as part of the ratings, then that becomes flat, which means Brampton, Mississauga, North York, Scarborough, their rates may go down, but Ottawa, Brockville and the rest might go up."

High-risk areas include Brampton, Mississauga, Vaughan and Toronto. Ottawa, Kingston and Brockville are considered low-risk areas.

The PC government say the goal is to eliminate discrimination and create fairness, but Thomas says if rates go down in high-risk areas, the low-risk areas would make up for it by possibly seeing a hike in their rates.

"It's entirely possible that it will be flat across the province," said Thomas.

"An insurance company is not going to write business at a loss."

The former Ontario Liberal Government promised to crack down on rising car insurance rates but Finance Minister Vic Fedeli says that never happened.

"We want to bring real relief for families," said Fedeli.

"They promised to reduce rates by 15% but they didn't have a plan to put it in place."

Liberal MPP for Ottawa South John Fraser says insurance rates can't be fixed by smoothing over postal codes.

"That'll drive up rates for drivers in Ottawa who don't have as much risk," said Fraser.

"They shouldn't be paying that extra in the premium."

The government will be seeking input from residents over the next 5 weeks. Residents ad drivers can share their feedback online through their website until Feb. 15.