Big List Of Car Insurance Questions & Answers

Here are some of the most common car insurance questions that I get… and the answers…

These questions and answers apply to Ontario, Canada, specifically…

Can I use a friend’s address to get a better insurance rate?

No, you cannot use your friend’s address to get a better insurance rate. This is fraud. A lot of people do this, but if you get caught you could have your claims denied and you could get your policy cancelled for misrepresentation. It’s not worth it.

Can I cancel my car insurance policy early?

Yes, you can cancel a car insurance policy any time. However, if you cancel it mid-term, there is a short-rat cancellation penalty. If you cancel at the renewal date, there is no penalty.

Does Continuous insurance affect car insurance rates?

Some insurance companies give discounts the longer you have been insured continuously. Even further, some insurance companies will give you further discounts the longer you’ve been with the same insurance company continuously.

Do I have to add my spouse to my car insurance policy?

Yes, you are required to tell the insurance company about all other licensed drivers in the household. If they do not have a car insurance policy of their own, you’ll have to list them on the policy or specifically exclude them with an endorsement (the endorsement is called OPCF 28a – Excluded Driver)

Do I have to add my children to my car insurance policy?

See the answer above about adding your husband/wife to your car insurance policy. The same answer applies to your kids – The insurance company has to be notified about all licensed drivers that live in the household. If they do not have their own insurance, they have to be listed. If they are under 25-years-old, they can be listed as occasional drivers.

Can an insurance company deny me insurance?

A specific insurance company can deny you insurance based on their underwriting rules. However, an insurance agent or broker cannot. Ontario has what’s called a “take all comers rule” that requires brokers and agents to offer insurance to all drivers. If a broker/agent cannot find an insurance company that’s willing to insure them, including a high risk insurance company, they must quote with Facility insurance, usually Nordic Insurance. Facility insurance is insurance of last resort in Ontario. It’s where drivers get insured when all other insurance companies in the province decline.

How does an insurance company find out about my tickets?

Insurance companies order what’s called an “MVR.” An MVR is basically a driver’s abstract that lists all convictions for the driver in the last 3 years. They will almost always order an MVR for new policies and usually for renewals too. Some insurance companies order an MVR at every renewal, while some order at 2-year or 3-year intervals, unless the policy is flagged to order sooner, like what would normally happen if there is a claim during the current policy period.

If a ticket clears from my record, will my insurance rate decrease right away?

When you get a new ticket, your insurance rate does not increase right away. It increases at the next renewal. The same thing happens if a ticket clears from your record – Your rate does not decrease right away; it decreases at the next renewal.

How much will my rate increase if I put in a claim?

Your rate will not increase if you put in a comprehensive claim or a claim for a not-at-fault accident. If you have an at-fault claim, your rate may or may not go up, depending on if you have the accident forgiveness endorsement on your policy. If you don’t have the accident forgiveness endorsement on your policy, your rate might go up a little or it might go up a lot. Every situation is different. For your particular situation, give us a call and we can tell you how an at-fault accident claim will impact your specific rates.

How do you get the accident forgiveness endorsement?

Most insurance companies in Ontario offer an accident forgiveness endorsement. What the endorsement will do is it will not increase your car insurance rates as a direct result of your first at-fault accident, while you remain insured with that particular insurance company. There are rules to qualify for the endorsement, mainly you usually have to be at least 6-years accident free. Most insurance brokers and agents will offer the endorsement to you if you qualify. Of course, if they don’t offer it to you, you can ask to put it on. The endorsement usually costs $0 to $10 per month, depending on the insurance company.

What are the cheapest cars to insure?

Basically, the cheapest cars to insure will be the cars with the best safety rating. You see, it costs the insurance companies more to cover injuries than it does to repair physical damage on a car. So, the safer the car is, the lower the insurance rate will be, generally. If you were looking for specific models of cars that have the best rates, that’s almost an impossible task. There are thousands of models of vehicles in operation in Ontario. Just consider some of the big vehicle manufacturers like Ford, Volkswagen, Mazda, Mercedes, Jeep, Chrysler, Hyundai, Honda, Audi, BMW, Porsche, Subaru, GM… and each manufacturer has dozens of different models. If you have a list of cars that you’re considering buying, you can always call us; we can quote you and then tell you which one of those will be the cheapest.

Which city has the cheapest insurance rate?

Let’s start by saying that certain cities in the GTA have the highest insurance rates in Ontario. Those would include Woodbridge, Brampton, and certain areas of Toronto, like Scarborogh and Rexdale. Then, generally, the further you get from the GTA, the lower your rates will be. So, the rate in, say, Sudbury or Thunder Bay will be much lower than in Mississauga or Markham. Small towns also tend to have very low car insurance rates. So, if you’re lucky enough to live in, say, Bancroft, Stratford, or Wiarton, your rates will be pretty low.

Which insurance companies offer a telematics program that give discounts based on driving habits?

On the broker side, Travelers, Aviva, and Intact offer a telematics program that offers discounts based on safe driving habits (usually the rating factors for discounts include acceleration habits, speeding habits, hard-braking habits, and time-of day driving habits). If you’re a safe driver, I recommend signing up for one of these programs; it’ll save you money.

How do insurance companies determine the rate for a car insurance policy?

The following factors get taken into account when determining the rate for a car insurance policy: Address, type of vehicle, amount of coverage, type of use (pleasure, commute, business, commercial), Age of driver, sex of driver, marital status of driver, class of driver’s license, number of years licensed, tickets in the last three years, accidents/claims in the last ten years, any insurance cancellations in the last three years (for example, policies cancelled due to non-payment or misrepresentation), insurance history (eg. some insurance companies give discounts for number of years continuously insured).

What does “pleasure use” mean?

Often, when people call me for a quote and I ask them if they use the car to drive to work, they will say, “it’s mainly for pleasure.” Whenever I say hear this, I think someone must have told them to say this to get a better insurance rate. What exactly does “mainly for pleausure” mean? “Mainly” has to be defined. If you drive to work, that’s not considered pleasure use, even if you phrase it as “mainly” for pleasure. Pleasure-use means that you don’t drive to work. If you call an insurance broker for a quote, don’t tell them it’s pleasure-use if you drive to work. Then you can have a claim denied if you get into an accident while driving to work.

When do accidents fall off your record?

Accidents actually never fall off your record. They’re not like tickets that clear off of your MVR (driver’s abstract) automatically after 3 years. Accidents go onto a completely separate database than do tickets. Accidents are recorded on an insurance history report called Autoplus. Autoplus is a complete insurance history. It shows all of the insurance companies that you’ve ever been insured with, all of the claims that you have had, whether they were at-fault or not-at-fault, and any insurance cancellations that you have had (eg. cancellation due to non-payment). The report is permanent and nothing on the report clears like what would happen with a ticket on your drive. That means that accidents stay on your record forever. However, that does not mean that accidents will affect your rate forever. They normally affect you for 6-10 years, depending on the insurance company.

Does your credit score affect your car insurance rates?

No, credit score does not affect your car insurance rates. Car insurance companies are not allowed to do that in Ontario. Credit score can affect your home insurance rates, though (condo and tenants insurance too). A good credit score can get you a discount on your home insurance.

Which insurance company has the best car insurance rates?

No insurance company has the best rate for all drivers. For example, Belair might have the best rates for a 50-year-old driver with a clean driving record, but the worst rates for a 40-year-old driver with a recent accident… TD Insurance might have the best rates for good drivers in Bolton, whereas Desjardins might have the best rates for good drivers in Whitby… Echelon might have the best rates for high risk drivers under 25, whereas Coachman might have the best rates for high risk drivers over 25. You see? No insurance company willalways have the best rates.

Can you insure someone else’s car?

No, you cannot insure something that you don’t own, as there would be no insurable interest. Imagine if you could insure someone else’s car, though… You could insure your neighbors’ car, light it on fire, then profit from the insurance payout. Sounds silly, right? Yes, and that’s one of the main reasons why you cannot insure someone else’s car.

Do I have to pay a deductible if I have a not-at-fault accident?

No, there is no deductible if the insurance company adjuster determines that the accident was not your fault.

Do parking tickets affect car insurance rates?

No, parking tickets do not affect car insurance rates.

Do car insurance companies have to offer monthly payment options?

Car insurance companies do not have to offer monthly payment options, but all of the car insurance companies in Ontario offer it anyway, unless you have a history of policies getting cancelled due to missed payment.

Can you get a short-term car insurance policy?

There are no short-term car insurance policies in Ontario. Echelon Insurance used to offer 3-month policies, but they stopped doing that. Every insurance company will do a one-year policy and some will do 6-month policies. Some of the insurance companies that will offer a 6-month policy include Aviva, Travelers, Echelon, Pafco, Pembridge, and Unica.

What are some common car insurance discounts?

Some of the most common discounts include: multi-vehicle discounts, multi-line discounts (that’s when you bundle your auto and property insurance policies, conviction-free discounts, winter tire discounts, discounts for having a CAA membership (only CAA insurance and Echelon offer this), graduated license discounts (eg, some insurance companies will give you a discount for the first year that you get your G2 or G class licenses), driver’s training discounts, and winter tire discounts.

Does TD Insurance, RBC Insurance, and Belair insure high risk drivers?

They do not. Most insurance companies in Ontario do not insure high risk drivers.

Which insurance companies insure high risk drivers in Ontario?

Echelon, Jevco, Pafco, Coachman, Economical, and Nordic insure high risk drivers in Ontario.

What is the minimum amount of liability coverage that you’re required to have?

Ontario requires you to have at least $200,000 liability coverage. However, the recommended amount is $2 million.

Can you decrease your car insurance rate by increasing your deductible?

Yes you can. However, the savings you get for increasing your deductible are usually not that significant, unless your rates are really high to begin with due to your driving record.

Do you have to have collision and comprehensive coverage if your vehicle is leased or financed?

Yes you do. If your car is leased or financed, the leasing or financing company will specify that you must carry collision and comprehensive coverage. It’s part of the lease or finance contract.

Will my insurance company cover me if I use my car for for Uber?

This has to be disclosed to your insurance company. Otherwise, any accidents that you have while using your car for Uber or Lyft can be denied and your insurance can be cancelled. This also applies if you use your car for food delivery with companies like Uber Eats or Skip The Dishes. Not all insurance companies will accept this. The ones that do will likely charge a little more due to the increase in risk.

Does State Farm offer auto insurance in Canada?

State Farm sold their book of business to Desjardins. State Farm no longer offers car insurance in Canada.

Does Geico offer car insurance in Ontario?

Geico does not offer car insurance in Ontario.

Does Kingsway offer car insurance in Ontario?

Kingsway Insurance used to do high risk car insurance in Ontario. Their book of business was sold to Jevco. Kingsway no longer offers car insurance in Ontario.

Is a cell phone charge considered a minor ticket?

A cell phone ticket, or using a hand-held device while driving, used to be considered a minor ticket. Now, most insurance companies consider it to be a major conviction and it could have a considerable affect on your car insurance premiums.

What is considered to be a minor ticket for underwriting purposes?

Minor tickets are the usual small tickets that a police officer might give out. They include offenses such as speeding, stop sign, failing to yield, failure to have insurance card, slow driving, and unsafe move.

What is considered to be a major conviction for underwriting purposes?

Major convictions are a little more serious than minor tickets. They include such charges as failing to report an accident, G1 violation, G2 violation, and failure to stop for emergency vehicles.

What is considered to be a serious conviction for underwriting purposes?

A serious conviction will have a huge impact on your car insurance rates. They include such charges as impaired driving, driving while suspended, careless driving, stunting, and speeding more than 50 km/h over the speed limit.

Is a temporary pink slip valid to drive?

When an insurance agent or broker sets up a new auto insurance policy, the customer will need proof of being insured right away. It can take days, or even weeks, to get the policy and the permanent pink slip in the mail. So, the broker or agent will send a temporary pink slip by email. The customer can print it out and use it until she gets the permanent pink slip. This is perfectly valid.

Which insurance company has the best reviews?

Here are some of the ratings of insurance companies, teken from Google reviews (out of 5):

Aviva: 3.9

Intact: 4.0

Belair: 4.3

Travelers: 1.8

Wawanesa: 1.7

SGI: 3.7

Pembridge: 1.8

Jevco: 2.6

Echelon: 1.7

Should I shop around for car insurance?

Certainly, call direct insurance companies like TD Insurance or Sonnet and also call brokers like us for a free quote. Our toll-free phone number is at the top of this page.

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