Does commuting increase car insurance?

There are a multitude of factors that influence the cost of car insurance in Ontario, and you may be wondering whether your daily commute is one of them. In this article, we will explore how the frequency with which you drive can impact your auto insurance rates and how BrokerLink can help qualifying customers find low mileage car insurance.

Daily commute and car insurance

The reality is that the distance you drive for your daily commute can impact your car insurance premium in Canada. Why? Insurance companies will take into account the amount of time you spend on the road and the distance you drive each day, and your commute is part of this.

If your daily commute is long, your insurance premium might be higher simply because you spend more time behind the wheel, and thus your chances of getting into an accident are higher. Given how a car accident affects car insurance rates, it’s no surprise that a long daily commute could influence your premium in this way. Oppositely, if you have a short daily commute or you choose to get to work using other modes of transit, such as public transportation or cycling, you will likely benefit from cheaper insurance rates.

When meeting with an insurance broker or agent, make sure that you accurately describe the details of your daily commute. Lying about the length of your commute is an example of insurance fraud and could lead to your claim being rejected or your insurance company cancelling your policy down the road.

Pleasure use and daily commute drivers

Insurance companies in Canada divide the kind of driving that policyholders do into two main categories: pleasure use and commute use. Pleasure use is any type of driving done for personal reasons. This may consist of driving to the grocery store or a friend’s home. Pleasure use driving is typically considered to be less risky from the perspective of an insurance company because it may be done at less busy times in lower traffic areas. It can also be done leisurely rather than in a rush to get to your destination while attempting to avoid rush hour traffic. Meanwhile, commute driving is done for work or school. In other words, your daily commute from your home to your office or your home to your university campus would constitute commute driving.

Insurance companies consider commute driving to be riskier as it often involves driving at higher speeds, at busier times, in high-traffic areas, and maybe also for longer distances. The category that you fall into as a driver can influence your auto insurance rates. In most cases, drivers fall into both categories and therefore how much time they spend driving for pleasure versus their daily commute will be considered. Generally speaking, the more time you spend commuting, especially if you have a long commute, the higher your insurance rates may be. Oppositely, if you mainly drive your car for pleasure, your rates are likely to be lower.

How commuting habits can affect car insurance rates

All kinds of factors determine car insurance rates in Canada, and your daily commute is one of them. Your daily commute contributes to how frequently you drive and the purposes for which you drive, which will both be factored in by an insurance agent when they are calculating your premium. The general rule of thumb is that the more time you spend on the road, the more your auto insurance policy will cost. Since one of the most common reasons drivers spend time on the road is to commute to work or school, one’s daily commute matters. Keep in mind that if you have a short daily commute, your insurance rates might be lower.

Further, if you choose to take another mode of transportation on your commute instead of driving, such as walking, cycling, or taking public transportation, your annual mileage might be so low that you qualify for an occasional driver car insurance policy. Occasional driver or low mileage car insurance plans are usually heavily discounted since they take into account the fact that your odds of getting into an accident and needing to file a claim are much lower. Learn more about how to calculate mileage to see if you qualify for an occasional driver discount by contacting BrokerLink.

If your commuting habits change, whether they increase because you started a new job and the office is located farther away from your home or they decrease because you start working from home part-time or taking public transit to work, make sure to notify your insurance company. In fact, if your driving habits change in any way, it is important to inform your insurer. If they decrease or become safer, you could save money on car insurance. Examples of driving habits that you should speak with your insurer about should they change are as follows:

• If you increase or decrease the amount of time you spend on the road
• If your daily commute changes, whether the route, distance, or both change
• If you start driving your vehicle for business reasons in addition to personal reasons
• If you start driving on highways or at night
• If you need to add or remove a driver to your auto insurance policy
• If you need to add or remove a vehicle from your auto insurance policy

Tips to save money on car insurance no matter your daily commute

Want to save money on car insurance? The BrokerLink team has put together the following list of tips that can help any driver in Canada keep auto insurance costs down, no matter the length of your daily commute:

Choose a safe car

Buying a car with a high safety rating is an effective way of saving money on car insurance. Insurance companies reward safety, so if your car has all kinds of safety features, odds are you will benefit from lower insurance premiums.

Consider alternative modes of transportation

If you want to qualify for an occasional driver discount or simply reduce how much you drive to save money on car insurance, consider alternative modes of transportation. Popular alternatives include carpooling, taking public transit, walking, or cycling.

Look into alumni and employment discounts

There are all kinds of insurance discounts out there, including alumni and employee discounts. When you contact an insurance broker, make sure to let them know what university you graduated from, if applicable, and where you work. They can then research whether any insurance companies in Canada offer car insurance discounts based on your alumni or employment status.

Increase your credit score

Having a high credit score comes with many perks, one of which might be an auto insurance discount. Some insurance companies in Canada offer reduced rates to drivers with stellar credit scores. The minimum credit score you must have to qualify varies, so be sure to ask a broker in advance.

Don’t buy more car insurance coverage than you need

When purchasing car insurance, make sure that you choose your coverage wisely. It can be tempting to purchase every type of coverage under the sun for the most protection, like accident forgiveness or insurance cover for towing, but this will cost you. Although some vehicles might warrant extra coverage or higher coverage limits, especially new or expensive vehicles, others won’t. For example, drivers of older or less expensive cars may find that comprehensive and collision coverage are not necessary. That said, it’s important to note that if you lease or finance your vehicle, you might be contractually required to purchase comprehensive or collision coverage.

Raise your deductible

One surefire way to cut car insurance costs is to increase your policy deductible. Choose a higher deductible from the onset or, when your policy is up for renewal, make the switch from a lower to a higher deductible. By taking on this extra financial responsibility, the insurance company will instantly reduce your premium.

Inquire about hidden fees that come with payment plans

You might think that choosing to pay for your car insurance plan monthly will come out to the same amount as if you pay it yearly, but this isn’t necessarily the case. Some insurers will tack on administrative or transaction fees to each payment made, which means that paying for your plan yearly might actually be cheaper. Make sure to enquire about these fees before selecting a payment schedule for your car insurance policy.

Install winter tires on your vehicle

Installing winter tires on your car could lead to major savings. Many insurers offer a winter tire discount to drivers who switch their summer or all-season tires to snow tires during the winter months. Why? Doing so can reduce how likely you are to get into an accident. Learn more about common car accidents by getting in touch with BrokerLink. You can also contact an insurance broker to learn more about how to qualify for a winter tire discount.

Purchase a hybrid or electric vehicle

If you’re in the market for a new car, consider buying a hybrid or electric vehicle and you could save money on car insurance. Buying an eco-friendly vehicle comes with many perks, from lowering your carbon footprint to qualifying for a reduced car insurance rate.

Sign up for a driver’s education course

Enrolling in a driver’s education course can make you eligible for a car insurance discount in Canada. Insurance companies recognize that learning from a professional makes you a safer and more responsible driver, which in turn, leads to lower rates.

Add an anti-theft device to your vehicle

One final tip for saving money on car insurance in Canada is to install an anti-theft, or other type of security system, in your vehicle. These devices can significantly reduce the odds of your vehicle being stolen, which in turn, can make you eligible for an auto insurance discount.

Contact BrokerLink to find out more about how your daily commute affects car insurance

If you want more information on how factors like your daily commute can impact how much you pay for car insurance, get in touch with BrokerLink. A licenced BrokerLink insurance advisor can answer any questions you have, including the ways in which using your car to commute can impact your rates. They can also provide insight into the other factors that insurance companies use to determine premiums and a free car insurance quote to give you an idea of how much your policy will cost. As auto insurance experts, your BrokerLink insurance broker can even help you find a new policy, renew an existing one, file a claim with your insurer, update your car insurance address, explain how no-fault insurance works, walk you through the process of reporting a car accident, or add a new driver to your policy. We are here for all your car insurance needs. Contact BrokerLink to learn more about our auto insurance services.

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FAQs on daily commute and car insurance

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