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Car insurance

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What’s the deal with car insurance? Don’t know where to start? We get it! Our guide breaks down the different types of coverage out there. Plus, we’re here to help you find the right type of policy for you.

27 million
people holding a driver’s license in Canada
23 million
light vehicles registered
1.2 million
heavy duty vehicles registered
730,000
motorcycles registered

Statistics as of 2018

How much does car insurance cost?

The average cost of car insurance in Canada is $1,151 per year, or $96 a month, but rates vary based on your car, location, and a host of other factors.

What factors affect my car insurance quote?

Your insurance quote comparisons can look quite different across several companies. That’s because insurers use info about you to determine your driving risk and set your quotes, based on factors like whether you park on the street or in a safe neighborhood and how many kilometres you drive each year.The 10 biggest factors that affect your rates are:

Your car

Your location

Your driving history

How much you drive

Your past claims

Your age

Your credit score

Your job

Your marital status

Your gender

Types of car insurance

Liability insurance

The most basic policy. Liability insurance provides coverage for any damages you may cause to someone else’s vehicle or property. It also covers losses like injury and death which your vehicle causes other people. This means if you smash into a Mercedes, you won’t be paying the repair costs from your pocket. However, it won’t cover the expense of repairing damages to your own vehicle.

Best for: Mandatory coverage for everyone

Collision insurance

This level of insurance provides coverage for repairing or replacing your own vehicle if you hit another car or object. It could also protect you if you get into an accident with an uninsured motorist. It usually includes mandatory liability coverage.

Best for: Those who want a bit more coverage for themselves and their vehicle without the price tag.

Comprehensive insurance

If you want premium coverage, this is the option for you. It’s the only policy type that offers “real, proper, actual” protection for your car. It covers theft, vandalism, storms, flood, hail, fire, key replacement, emergency accommodation, rental cars, accidental damage (to name a few) – in addition to everything covered by cheaper policies.

Best for: Those who want peace of mind, knowing they have the highest coverage available.

How do I compare car insurance?

Ever wonder why insurance policies and quotes are different for every insurer? Make sure you’re comparing equivalent rates to get the strongest insurance quotes.

  • Balance the best coverage with the cheapest rates. The goal is to get the right coverage for you with the best deal. But consider every factor that might be important, such as discounts you qualify for, how easy it will be to make claims or whether you’ll pay extra for perks you need.
  • Make sure you’re comparing apples to apples. Check for the same perks and coverage, and make sure the deductible and pay schedule are the same. If you’re not getting good rates from the big national companies, look for a company that specializes in the coverage you need.
  • Get multiple quotes. It’s helpful to consider at least two to three of the cheapest quotes with the same level of coverage you need. And while it’s good to consider discounts in your initial search, make sure you’re also considering the final price too.
  • Check for exclusions. Read the fine print on your car insurance quote before you sign on the dotted line. Make sure you’re covered for everything you expect, and avoid claim caveats like cancellation fees.

Annual car insurance rates by province and territory

10 tips for getting cheap car insurance

No one wants to overpay for car insurance. And it’s hard to compare policies to get enough coverage at the right price. The best way to save is by shopping around for cheap car insurance.

1. Start with customized quotes.
Different people can pay drastically different prices for car insurance even at the same company. Compare car insurance companies that can offer you the best deal for you individually, not across the board. You can also compare local insurance companies, which tend to have higher customer satisfaction rates than their big-name counterparts and could potentially have lower rates.

2. Hunt for discounts.
Some insurers offer discounts to drivers for a variety of reasons such as having a clean record, paying an annual premium all at once or being a safe driver for a certain period of time. If the insurance company you’re with offers more than just auto insurance, consider bundling all your insurance through them, like home and car insurance. Most companies offer a group discount, even if it’s just for more than one car.

3. Get the right coverage for your car.
Make sure you are getting the appropriate coverage for the car you’ve driving. Consider skipping collision or comprehensive coverage for an old car. The value of your car determines your maximum payout if it’s stolen or totaled, meaning these policies are not very useful for older vehicles.

4. Raise your deductible.
A higher deductible means lower premiums but if you get in an accident, you will have to pay more up front. For example, if you have a $500 deductible on a $2,000 accident, you’d pay $500 before your insurance company covers the other $1,500. With a $1,000 deductible, you’re paying $1,000 and your insurer covers the remaining $1,000.

5. Look into pay-per-kilometre insurance.
If you drive under a certain amount of kilometres every year, you can tell your insurance company and possibly qualify for a low mileage discount. This is a common discount that many drivers actually qualify for but are not aware of. If you only use your car for occasional short trips, you can sign up for a usage-based insurance program that determines your rates based on how much you drive.

6. Avoid accidents and tickets.
These 2 are surefire ways to make your premium go through the roof. If you live in a high risk area or are prone to getting in accidents, look into a provider that offers accident forgiveness, where your first accident won’t make your premiums go up.

7. Take a defensive driving course.
If you have a less than stellar driving record, sign up for a defensive driving class. Most insurers will give you a discount on your premiums. Your local provincial service centre can point you in the right direction.

8. Combine policies with your parents or spouse.
Look into being a nominated driver on your parents’ insurance. Their rates might go up, but it could be less overall than keeping your solo policy. And because married drivers tend to file fewer claims, you’ll often get a discount on your premium just for getting engaged or married. Married couples can also save by combining their insurance on one policy to save money.

9. Check and maintain your credit history.
Most auto insurance companies take your credit history into account for your pricing. The reasoning behind it? Research actually shows that people with a higher credit score tend to make fewer claims.

10. Choose the right car.
Newer, cheaper cars tend to be cheaper to insure. Luxury cars have a higher sticker price and tend to cost more for as long as you use it. It’s worth buying a cheaper car, especially if you’re a young driver. If you haven’t purchased a car yet or are getting ready to shop for a different car, compare insurance prices for car models you’re interested in. The insurance price differences might surprise you.

Changing your insurer

There’s a common misconception that changing car insurance is a huge hassle. In reality, it isn’t as hard as you think. There are a few times where you should actively consider changing policy. If your circumstances have changed, chances are your premiums may alter too. Consider finding a new insurer when:

  • Your policy comes up for renewal
  • You change cars
  • You move into another home
  • The number of drivers using your car changes
  • You’ve just celebrated a birthday
  • Your driving record has changed

Here’s how to do it:

Step 1: Find a new car insurance policy

Before you abandon ship, it’s a good idea to have another one you can climb aboard first. Compare car insurance policies side-by-side. Be sure to consider not just price but what features you need in a policy and how much coverage you want, especially if you’re looking at a comprehensive policy.

Your car insurance questions answered

Finding the right coverage

Policy information

Purchasing, renewing or cancelling your policy

What you will/won’t be covered for

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