What is personal injury coverage?
7 minute read Published on Apr 17, 2024 by BrokerLink Communications
If you’re wondering what personal injury coverage is in car insurance, you are in the right place. With help from the BrokerLink team, we can explain all there is to know about this important mandatory type of car insurance. We can also explain how a personal injury claim affects insurance and recommend how much of this type of coverage to add to your policy. Keep reading for more information.
Bodily injury liability insurance explained
Bodily liability insurance, which may also be referred to as personal insurance insurance is a type of third-party liability car insurance. More specifically, it is a type of liability insurance that can protect you if you get into a car accident and that car accident causes bodily harm to another. Whether it’s a pedestrian or another driver who suffers physical injury due to the accident, third-party liability coverage is the type of insurance you will claim if the police determine that you are at fault for the collision.
Given how often car accidents happen in Canada, especially these common car accidents, liability coverages, such as personal injury coverage, are extremely important. In fact, all provinces and territories in Canada have made them mandatory. This means that to drive anywhere in Canada legally, you must purchase liability insurance. How much liability insurance you are required to purchase varies between provinces.
For example, in Ontario and Alberta, motorists must have at least $200,000 in third-party liability coverage added to their policies. In Nova Scotia, you must have at least $500,000 in third-party liability coverage, though many in all provinces opt for higher coverage limits.
It is worth noting that personal injury or bodily injury coverage is just one branch of third-party liability coverage, the other being property damage coverage. Thus, most drivers choose to add more than the minimum requirement in liability coverage to their policies since they want to be protected against even the most extreme accidents that result in both bodily harm and property damage.
What does personal injury insurance cover?
Generally speaking, personal liability coverage is a type of car insurance coverage that offers financial security to drivers who get into at-fault accidents that result in damage. Whether the damage that is done is property damage, bodily injury, or both, you can file a third-party claim with your provider and begin the claim process. Before beginning the claim process, determine if a police report is required for the insurance claim.
As mentioned, liability insurance covers two main risks: property damage and bodily injury. Bodily injury is what we are concerned with today. Thus, the bodily injury coverage branch of liability insurance covers expenses relating to injury or death arising from the collision. For example, bodily injury coverage can pay for prescription medication, funeral fees, rehabilitation like physical therapy, other forms of medical care, and even lost income if the injured person is temporarily unable to do their job and loses out on income for a certain period of time.
What isn’t covered by bodily injury insurance?
Bodily injury insurance has its limits. In other words, it won’t protect drivers against everything, which is why it’s so important to round out your policy with different types of coverage, such as accident benefits coverage, direct compensation coverage, comprehensive coverage, collision coverage, uninsured motorist coverage, and more.
To give you a better idea of what personal liability car insurance does not cover and, therefore, what you will need extra insurance for, keep reading:
- Expenses relating to an accident for which you are not at fault - Remember that liability insurance only covers at-fault accidents, so your claim may be denied if you try to file a liability claim for an accident that wasn’t your fault.
- Vehicle theft.
- Hit-and-run accidents.
- Damage caused by weather-related incidents - such as fire, flooding, hail, a fallen tree, etc.
How much personal liability coverage do I need as a driver in Canada?
As a driver in Canada, you are obligated to add liability coverage to your policy. However, how much you are obligated to add varies between provinces. Below, we provide a breakdown of the minimum requirements for third-party liability insurance in each Canadian province and territory:
- Ontario: $200,000
- British Columbia: $200,000
- Alberta: $200,000
- Saskatchewan: $200,000
- Manitoba: $200,000
- Newfoundland and Labrador: $200,000
- New Brunswick: $200,000
- Nova Scotia: $500,000
- Prince Edward Island: $200,000
- Northwest Territories: $200,000
- Nunavut: $200,000
- Quebec: Free via Société de l’assurance automobile du Québec or $50,000 when bought via private insurers
Please note that although many provinces in Canada only require you to purchase $200,000 in liability coverage, experts typically recommend selecting a higher coverage limit. The reality is that $200,000 isn’t a lot of protection, especially if you get into a major car accident. Thus, it’s not uncommon for some motorists to choose limits that are five to ten times this amount, such as $1,000,000 or $2,000,000.
There are a few circumstances in which you should definitely think twice about only adding the minimum coverage requirement in your province. For instance, if any of the following apply to you, we urge you to consider adding extra liability insurance to your Canadian auto insurance policy:
- You live or commute in an area with high collision rates
- You regularly carpool with others
- You use your car for business or work purposes
- You frequently travel to and drive in the United States
If you seldom drive or are labelled an occasional driver, then a lower coverage limit might be enough.
If you want an expert opinion on how much liability insurance to add to your policy, contact BrokerLink today. One of our licensed insurance advisors would be pleased to provide more information on the importance of liability insurance and recommend the correct limit for your needs and budget.
How much does bodily liability insurance cost in Canada?
Costs for third-party liability coverage vary and depend on a number of factors, such as:
- Where you live
- Age
- Gender
- Vehicle type
- How you use your vehicle
- Driving record
- Driving experience
- Past claims
- Prior insurance coverage
- Number of kilometers you drive
- Type of coverage on your policy
- Your deductible(s)
Ultimately, the best way to find out how much bodily insurance coverage will cost you is to request a free insurance quote from a BrokerLink insurance broker. A BrokerLink advisor can not only tell you how much liability insurance costs but also how much your entire policy will cost since liability insurance is not the only mandatory coverage type in Canada. Reach out to BrokerLink to find out how much car insurance costs per month in Ontario today.
How to save money on personal injury coverage in Canada
There are a few ways to save money on personal injury coverage in Canada. First, make sure that you shop around and compare your options before settling on an insurance policy. An insurance broker can reach out to the top insurance companies in Canada, obtain car insurance quotes from each, and analyze them to ensure you find the most competitive price for your policy.
From there, once you’ve settled on a policy, there are more ways that you can lower your premium. For instance, choosing high deductibles on your bodily injury coverage and paying for your policy annually instead of monthly can result in lower rates. You can bundle your car insurance with another type of policy, such as property insurance or recreational vehicle insurance.
For even more money-saving tips, contact BrokerLink today.
Other types of mandatory car insurance coverage in Canada
Now that you know a little bit more about personal injury coverage in Canada, which is a mandatory coverage type in all Canadian provinces and territories, let’s dive into some of the other coverages that are also legally required in Canada. For example, the following three coverages must all be added to your Ontario car insurance plan alongside third-party liability insurance:
Accident benefits coverage
Accident benefits coverage covers medical and rehabilitative care if someone is injured in an accident. Unlike personal injury coverage, which is a form of liability insurance and thus only comes into play for at-fault accidents, accident benefits coverage can be claimed when the accident was not your fault. It can also cover bodily injury fees for passengers and pedestrians. Thus, if you are hit as a pedestrian, your medical expenses would likely be covered between accident benefits and personal injury liability insurance.
Direct compensation coverage
Direct compensation coverage is a type of property damage coverage that will pay for your vehicle to be repaired if it is damaged in an accident, as long as you are not at fault for the accident.
Uninsured automobile coverage
Uninsured automobile coverage can compensate policyholders if they are involved in an accident with an uninsured or underinsured motorist. It can also cover hit-and-run accidents.
Optional car insurance coverage for drivers
A few other types of auto insurance that may be important for drivers in Canada are listed below. Please note that these coverages are all optional, meaning you are not under any legal obligation to purchase them unless you lease or finance your car and your contract stipulates that you must have them.
Collision coverage
Collision car coverage is another property damage coverage that will pay you to repair or replace your car if it’s damaged in a collision.
Comprehensive coverage
Comprehensive car coverage, or parked car insurance, is a type of property damage coverage that will pay for your car to be repaired or replaced if it’s damaged while parked. Specific risks that comprehensive coverage protects against include fire, theft, vandalism, weather-related incidents, falling and flying objects, and explosions and riots.
Accident forgiveness coverage
Another type of optional car insurance coverage popular among drivers is accident forgiveness. Accident forgiveness is additional coverage that can be added to your car insurance policy as an endorsement to protect your driving record and to help prevent your insurance premium from increasing if you have an at-fault accident claim. Note: coverage and eligibility vary by province.
Find out more about personal injury coverage by reaching out to a BrokerLink insurance broker today
Do you still have questions about personal injury coverage in Canada? BrokerLink is here. Call us today or visit one of our 200+ locations in person to have all your car insurance-related questions answered. For example, we can explain what personal injury insurance does and doesn’t cover, how to cancel a personal injury claim, and how much personal liability insurance you are legally required to add to your auto insurance policy.
Plus, we can offer you a car insurance quote without strings attached. All quotes are completely free of charge and can be obtained in minutes. What are you waiting for? Contact BrokerLink today to get started!