If you’re looking to insure your vehicle, the minimum coverage you’ll be required to get in all provinces is third-party liability. This coverage is primarily used to pay for the legal bills, medical bills and vehicle damages of other drivers if you cause an accident.
Learn more about what’s included with third-party car insurance and find out which companies offer the lowest rates for this type of coverage.
What does third-party car insurance cover?
Third-party liability coverage is a mandatory level of insurance that all drivers must have when operating a vehicle in Canada. This coverage pays for a number of different costs that you might incur if you get into an accident that’s deemed to be your fault. These include the following:
- Repair costs for other vehicles damaged in an accident
- Repair costs for any property you’ve damaged in a collision
- Medical costs for anyone you’ve injured
- Disability income or death benefits for anyone you’ve injured
- Legal fees and lawsuits resulting from the accident
- Damages awarded to drivers and passengers in court
How much third-party car insurance do I need?
Most provinces will require you to have at least $200,000 worth of third-party liability coverage to get your vehicle on the road. The exception to this rule is Quebec, which requires a minimum of $50,000 in coverage. You’ll also get a capped amount for property damage included with this amount (which equals $10,000 in most cases). You can choose to increase your third-party liability to between $1 and $5 million, depending on what level of coverage you want. Just be aware that any increase in your coverage will result in an increase in your premiums.
What other types of mandatory coverage might I need?
- Accident benefits. Covers your expenses if you (or your passengers) get hurt in an accident and you need medical attention or are unable to work.
- Uninsured motorist protection. Gives you extra protection if another driver doesn’t have enough insurance to cover your claim.
- Hit-and-run insurance. Provides coverage for any damage or injuries you may suffer as a result of a hit-and-run.
- Inverse liability protection. Covers you in parts of Canada or the US where local laws don’t let you file a claim against the person who caused your crash.
What’s the difference between liability and collision/comprehensive insurance?
If you want the cheapest car insurance available, you’ll usually only want to insure your vehicle with third-party liability. That said, you may want to add on collision and comprehensive if you have a new or expensive vehicle, just to be safe.
- Third-party liability. This is the most basic form of coverage. It pays for the medical bills of other drivers and covers damage to other vehicles in a collision that’s your fault.
- Collision. Pays for maintenance and repairs to your vehicle following a collision or pays to replace it if it’s certified as a write-off.
- Comprehensive. Protects your vehicle in the case of damage due to falling objects, vandalism, fire, theft, natural disasters or civil disobedience.
Mandatory provincial coverage requirements
There are different requirements for mandatory insurance based on which province you’re located in. Mandatory insurance must be provided by provincial insurance agencies in BC, Saskatchewan, Manitoba and Quebec. Other provinces allow private insurance companies to sell compulsory insurance.
Prince Edward Island
How much will third-party car insurance cost with different providers?
The price that you’ll pay for your insurance will depend on a number of different personal factors. While it’s impossible to give you an exact price for your unique personal situation, we can make a general comparison using a run-of-the-mill vehicle and driver profile.
Sample vehicle and driver
We chose to compare quotes for third-party car insurance on a 2013 Honda Civic clocking 15,000 km per year. We listed the driver as a 30-year-old female with 10 years of driving experience and a perfect driving record.
As you can see, the prices outlined in the example below vary based on which provider you go with and which province you’re getting insurance in. We chose ten of the cheapest options to give you an indication of how your prices might fluctuate based on these factors.
*All prices in this table are listed as price per month of coverage
*Quotes as of 28 July 2020 (subject to change based on personal details)
Can I get further discounts on my third-party car insurance?
You may be able to bring your rates down even further if you apply for the following discounts on your car insurance (where eligible).
- Accident-free discount. You could get a discounted rate if you’ve been accident-free for a certain time period (typically around three to five years).
- Bundled policies discount. You’ll likely get a rebate if you decide to bundle your car insurance with your home or life insurance.
- Security/safety features discount. You could save money if you have alarms, anti-lock brakes, airbags or other security and safety features installed in your vehicle.
- Hybrid vehicle discount. You might be able to save a chunk of cash if you choose to drive a hybrid or eco-friendly vehicle.
- Senior or student discount. You could stand to save money on your premium if you’re attending post-secondary or recently retired.
- Multi-car discount. It’s likely that you’ll save money across the board if you register more than one vehicle with the same insurance company.
- Safe driving discount. Some insurers will let you download an app to track your driving habits and you may be eligible to get discounts for driving safely.
What should I know before I apply?
To apply for car insurance anywhere in Canada, you’ll usually need to meet the following criteria:
- Be at least 16 years old
- Have a valid Canadian driver’s licence
- Own the vehicle you wish to insure
- Fulfill additional criteria based on which province you live in
How to apply
If you want to apply for third-party car insurance, you just need to follow these simple steps.
- Visit the website of the car insurance company you’re interested in to submit an application for a quote online.
- Provide the necessary documentation – such as a valid driver’s licence and proof of purchase for your vehicle.
- Get verified and work with your provider to negotiate the terms of your car insurance if you meet the eligibility requirements.
Third-party car insurance is designed to protect you from legal action in the event that you cause an accident. In particular, it will help cover any costs you’re required to pay for vehicle damages or injuries sustained by other drivers or their passengers. Learn more about what third-party insurance you might need to purchase in your province and compare providers to find the best fit for you.
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