TORONTO (CP) - Motorists in Ontario should see cuts in their insurance rates averaging more than 10 per cent because of government moves to reduce costs for insurers, Finance Minister Greg Sorbara said Tuesday.

"Virtually every motorist in the province will see lower rates for the same coverage," Sorbara said in an interview. "Assuming no new accidents and you're not buying a new Hummer." Sorbara said rate applications approved by the government indicate average premium reductions of 10.6 per cent when drivers renew their policies this year.

The Insurance Bureau of Canada predicted Ontario drivers would save an estimated $900 million this year because of lower premiums, which it credits to regulatory changes that eased financial costs for companies, convincing more of them to sell auto insurance.

"It's a combination of the changes that government has finally made here in Ontario that help us control some critical costs in the system," said bureau vice-president Mark Yakabuski.

"And as well, it's the return of competition to the auto insurance market which is having a very, very positive effect for consumers."

The Canadian Automobile Association said it was pleased to hear insurance rates would finally by dropping as the Liberals promised when they were first elected in 2003.

"Something had to be done" to lower rates, said spokesman Mark Arseneault.

"We were expecting it earlier than it actually came through, but if it has reached 10 per cent, then that's great news."

One way the government helped insurers reduce costs was by agreeing to limit the amount of physical therapy or other treatment for non-life-threatening injuries suffered in accidents.

"I think probably the most important element is lower health-care costs as a result of accidents," Sorbara said. "In some cases, it's putting a maximum amount that can be spent on a particular injury, but these are primarily for minor injuries."

But NDP Leader Howard Hampton said capping medical coverage for accident victims is a dangerous precedent that could cost injured people a lot of money in the long run.

"If there is any reduction at all in insurance rates - and I doubt that there will be - it will come at the expense of accident victims," Hampton said.

"What's being cut here will be access to a chiropractor or a physiotherapist after someone has suffered a whiplash injury that can debilitate someone for months."

Both Hampton and Conservative finance critic Jim Flaherty said they don't think most Ontario drivers will actually get a 10 per cent reduction in insurance rates.

"I don't know what fun with figures is going on here," Flaherty said.

"I just know where the rubber meets the road, so to speak, I'm not hearing reports of people getting that kind of reduction in their automobile insurance."

When the Liberal government was elected in October 2003, Premier Dalton McGuinty immediately froze car insurance rates for 90 days and promised premiums would fall an average of 10 per cent after insurers filed new rates with the government.

"During the election campaign, we said we'd take steps to reduce auto insurance rates by 10 per cent," Sorbara said.

"We have now got to that objective and beyond at 10.6."

The government promised to take action on rates after Ontario motorists saw their insurance premiums rise an average of 14 per cent in 2003 after 15.75 per cent increases in 2002.