All drivers in Canada must purchase mandatory coverage for their vehicles. If you live in Ontario, we hate to be the bearer of bad news, but it has to be said that Ontario drivers pay some of the highest car insurance rates in the country.
But don't panic--the experienced broker team from BrokerLink is here to give you some of our best-kept tips and tricks that can help you lower your car insurance premiums so you can spend your hard-earned money on the things and people you love most! Stick around for more information:
How much does car insurance cost in Ontario?
Canadian drivers living in Ontario can expect to pay anywhere between $1300 and $2000 a year on car insurance. This averages to about $139 dollars a month. Remember, this is just an estimate, and the amount you pay will be dependent on your unique circumstances.
Want to save on auto insurance premium? Here's how:
At Brokerlink, we wholeheartedly believe that vehicle insurance should be affordable for all Canadians. If you want to save on your car insurance policy the next time you're up for a renewal, here are some tried and true methods to do just that:
Maintain a good credit record
Yes, your credit record does impact whether you qualify for a lower car insurance rate. Many insurance companies in Canada use your credit score when pricing out car insurance policies for their customers.
The logic behind this is that they want to make sure their customers can pay their car insurance costs. To build a good credit record, make an effort to pay bills on time and keep balances low if you can. You can check your credit report on a regular basis to monitor your performance over time and stay motivated.
Take a defensive driving course
All insurance companies favour safe driving habits and a clean driving record. If you're looking to lower your insurance costs, consider taking a driver training course. This is especially important for young drivers, given that an insurance company thinks inexperienced drivers are more of a risk to insure than those with a longer driving history.
Ultimately, not only will graduating from a safe driving course help you save money on your car insurance premium, but it will also teach you how to handle certain scenarios that could put you at risk of having to file a car insurance claim.
Shop around with different car insurance companies
Shopping around for car insurance is one of the best ways to see what companies are offering and what the pricing of their car insurance plans are. By shopping around, not only are you able to find the most affordable car insurance policies out there, but you'll also get a better sense of what your insurance needs are by finding a policy that meets what you're looking for.
Remember, while affordable insurance is great, it's also essential that you don't sacrifice the level of protection you have at the end of the day. Finding a balance here is key to having an insurance policy you can feel confident in when you're behind the wheel of your vehicle.
Ask about insurance discounts
Believe it or not, most car insurance companies offer various discounts to customers in Canada that you, too, may be eligible for. Some common insurance discounts to ask about include:
Installing winter tires discount
With ice and snow on the roads, the winter season in Canada can be harsh and dangerous, making it incredibly hazardous for drivers. Many insurers offer discounts if you make your vehicle safe for the winter weather. One way to do this is by switching to winter tires during the colder months of the year. Winter tires are built to deal with these dangerous conditions, reducing the likelihood of you getting into an accident.
Multi vehicles discount
Do you live in a household that has multiple vehicles? If so, you could qualify for a multi-vehicle discount with your insurance company. Similar to how companies offer discounts to customers who have several policies with them, you can also save on your rates by insuring all your vehicles with the same provider as a thank you for your continued loyalty and business.
Low mileage discount
Some companies offer low-mileage discounts if you drive under an annual mileage threshold. For example, some insurers require drivers to have under 12,000 kilometres per year, while other companies may require less than 15,000 kilometres annually. So, if you only use your car some of the time, are a frequent carpooler, or use public transportation often, consider this discount and save on your car insurance rate.
Professional organization discount
Some employers, associations, and professional groups offer group insurance policies. If you're a member of any professional groups, you could qualify for a discount. When renewing your policy, make sure to ask an insurance advisor to learn more about your eligibility.
Maintain a clean driving record
Your insurance history can play a major role in what you pay to your insurance company each year. Safe drivers are less of a risk to insure. Ultimately, insurance providers cost less money on average than those who have more than one at-fault accident on their record.
If you want to save on insurance, you have to be a safe driver. That's as simple as it gets. Make sure to follow the rules of the road, maintain a safe speed, keep your distance from other drivers, and take note of your surroundings at all times!
Bundle your auto and home insurance
If you have multiple types of insurance already, bundling your home and auto insurance can help you save on your premiums! Most insurance companies offer discounts to customers who purchase multiple from them as an incentive for being loyal to the business. An added bonus to having your insurance coverage with the same provider is that it makes it easier to oversee all your policies and file claims should you need to.
Pay for your car insurance premiums annually
If you can afford it, paying for your car insurance upfront rather than each month can actually save on your insurance rates. When you pay for insurance monthly, your insurance company has to pay an administration fee to process the payment, which you, as a driver, are responsible for paying. So, by paying for your car insurance costs in one go, you can remove the administration fees and save overall.
Enhance the safety features on your vehicle
The purpose of safety features is to keep accidents from happening and to guarantee that your car can navigate safely in an emergency. When you buy a new car, you have the option to add some of these to your vehicle, and by doing so, you can save more money when it comes to monthly auto insurance rates. Just keep in mind that adding these extras to your new vehicle will cost you more money when buying it. Common features include anti-lock brakes, dash cams, airbags, burglar alarms, and more.
Get usage-based insurance
Usage-based insurance is a type of auto insurance in Canada in which the annual premiums for drivers are calculated based on their actual vehicle usage and driving habits. If you opt for this type of coverage, you'll have to install a telematics device in your vehicle.
This device essentially motors how, when, and where a driver uses their vehicle throughout the year and rewards drivers with lower premiums for maintaining a clean driving history during the duration of their insurance. If you're interested in this type of coverage, ask your insurance company the next time you're up for an insurance renewal.
Review your auto insurance coverage
All drivers need insurance in Canada, and each province and territory has a minimum coverage amount that drivers must purchase. Beyond these minimums, most drivers tend to purchase more coverage in addition to basic insurance plans.
If you want to save on your premiums, consider reviewing your current portfolio when you're up for renewal. This will give you a better sense of the type of coverage you have, the amounts, and whether what you currently hold matches your current needs as a driver.
You might require more or less coverage than you did the year before due to changing circumstances. It's also possible that your finances change within a year as well. So, speak with an insurance advisor before renewing so you can keep only the coverage that you absolutely need and aren't paying for things that are no longer serving you.
Drive a car with low repair costs
It goes without saying that expensive cars have expensive insurance costs and repairs, for that matter. Car insurance companies in Canada will consider the type of vehicle you have when pricing your insurance rates. For example, they often take a look at how likely the car will be stolen, how much it costs to repair or replace the vehicle, how safe it is to drive, and how often claims from the same vehicle are filed each year.
Every year, the Insurance Bureau of Canada releases a report that examines data on the number of and expenses associated with specific claims for well-known car models. To find out where your automobile currently stands, you can review the report for more information. On average, it typically costs more to insure new and luxury vehicles. So, if you're in the market for a new car, consider taking a look at the report to see which cars are more expensive to insure than others.
Increase your deductible amount
If you've purchased car insurance before, you'll know that your deductible is the amount you need to pay when filing an insurance claim before insurance companies pay the remaining amount for repairs.
Generally speaking, increasing your deductible decreases your insurance rates. This is because you're technically taking on more of the responsibility for any repairs or replacements that are needed for your vehicle if it's damaged in a collision or non-collision event, which reduces the amount your insurance provider has to pay.
Keep in mind that this isn't the best course of action for all drivers, and only those who can comfortably pay an increased deductible should consider this when trying to lower their insurance rates.
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What information does an insurance company use when calculating your insurance premium?
If you're a first-time driver, you may have some questions regarding how an insurance company calculates rates for each driver. The truth is that each insurance company has its own scaling system when it comes to pricing car insurance plans. However, there are some overlapping factors that the majority of auto insurance companies use:
Where you live in Ontario
The cost of auto insurance varies greatly depending on where you live. For instance, in Ontario, premiums for urban locations are typically greater than those for rural or suburban areas. This is due to the fact that driving in cities is riskier due to increased traffic and crime rates.
Your age
Insurance providers often view younger drivers as a higher risk to cover than older drivers since they have less experience behind the wheel. As you get older and more experienced behind the steering wheel, your rates may go down if you maintain safe driving habits.
Your credit history
A lot of insurance providers also take your credit history into account when calculating insurance premiums for Canadian drivers. Having a better credit score can translate into lower insurance rates. If you don't have a healthy credit score, don't panic. When weighed with other factors, this shouldn't impact your premium as much as you think it does.
Your gender
Historical insurance data indicates that young, inexperienced male drivers are more likely to get into an auto accident compared to female drivers. So, in the beginning, if you are a male driver, you can anticipate paying more for your auto insurance until you prove to your insurance providers that you are a safe driver.
The make and model of vehicle you drive
The cost of your coverage will also depend on the type and model of vehicle you drive. Insurance companies tend to consider luxury and sports cars as more risky than an older car would be, or cars with security features because they are more likely to be stolen and have greater repair costs.
Your driving history
Being a safe driver, having a clean driving record or having fewer accidents can help you out significantly when purchasing auto insurance policies.
Drivers with a history of accidents, driving infractions, or other penalties will pay a higher premium because they pose a greater risk to the insurance company than drivers with clean driving records.
The annual mileage you drive
The likelihood of being in an accident increases with the amount of driving you do. Therefore, compared to people who don't drive frequently and only use their car occasionally, having a higher annual mileage can result in more expensive insurance.
Your deductible amount
When compared to a cheaper deductible, having a greater deductible can result in reduced auto insurance premiums. You will bear a greater portion of the upfront expenses prior to your insurance taking effect if your deductible is more expensive. In contrast, a lower car insurance deductible could result in a higher insurance rate. The key here is to find a balance between coverage and affordability in case you need to file an insurance claim with your company.
What you use your car for everyday
Your insurance costs are lastly influenced by your driving habits. Since you'll be driving more and face more risks, cars used for work or longer commutes typically have higher car insurance rates, given the amount of time they spend on the road.
What is the difference between public insurance providers and private insurers?
Depending on the province or territory you live in, Canada offers opportunities for both private and public car insurance. Authorities under government control handle public auto insurance. The following provinces have public insurance programs: Saskatchewan, Manitoba, British Columbia, and Quebec. Because of this, drivers in these provinces are unable to shop around for the best deals and coverage from multiple auto insurance providers; instead, they must obtain their insurance from a single provider. In contrast, drivers can compare rates and policies in regions with private insurers, including Alberta, Ontario, New Brunswick, Nova Scotia, Prince Edward Island, Yukon, Nunavut, and Newfoundland and Labrador.
What insurance is available in Ontario?
Mandatory insurance in Ontario that all drivers must purchase include the following:
Liability coverage
One of the most essential insurance policies you should have in Canada is third-party liability insurance. It provides financial security in the event that, while driving a car, you injure a pedestrian, another driver, or a passenger.
Your third-party liability insurance plan will pay for any repairs, attorney's fees, medical expenditures, and other incident-related costs if you cause a car accident that injures a pedestrian. The minimal requirements for this kind of auto insurance policy vary by province in Canada. However, in Ontario, the minimum is $200,000.
Accident benefits
The purpose of accident benefits insurance is to assist anyone hurt in an accident in getting the medical care they need. No matter who is determined to be at fault, this coverage includes the driver, any passengers in the car, and any pedestrians.
This auto insurance policy can help pay for out-of-network medical expenses, such as prescription medication, physical therapy, or rehabilitation efforts, as well as lost wages while you're recovering.
Direct compensation property damage
This policy will protect an insured vehicle as well as the driver's personal items so long as the insurance buyer is not at fault for the collision that caused the damage. Ultimately, your insurance company frequently pays for the replacement or repairs of your automobile directly, saving you from having to deal with the other driver's insurance provider.
Uninsured driver coverage
This automobile insurance plan will provide complete protection if you and any passengers are in an accident with an at-fault driver who is either underinsured or struck by an uninsured driver. This coverage also provides protection against hit-and-run accidents Furthermore, optional coverage you can add to your overall portfolio includes:
Accident forgiveness coverage
Accident forgiveness is a policy that protects you from experiencing increases in your insurance premium for your first at-fault accident. This is a policy meant for safe drivers and first-time drivers.
Collision coverage
Collision coverage can assist with the related costs in an accident involving another car or item on the road, no matter who is at fault. This covers all repairs and replacements for your car.
Comprehensive coverage
Comprehensive coverage protects your vehicle in the event that it suffers damage from a non-collision event, such as flooding, falling objects, and other perils listed in your policy. It will cover the cost of repairs or replacements needed.
Get affordable car insurance with the help of BrokerLink today!
If you're looking to save money on your car insurance rates, you've come to the right place. BrokerLink is a leading insurance brokerage in Canada with locations across the country. Our experienced brokers have access to some of Canada's top insurance companies and policies, allowing us to customize an insurance plan that's tailored to your unique needs and budget.
If we're in your neighbourhood, don't hesitate to visit us in person to work with one of our friendly team members directly. If you aren't able to make it into one of our locations, you can also reach us over the phone during business hours! Alternatively, you can use our online insurance quote tool to get a customized, competitive quote right from the comfort of your own home.
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