Ontario Auto Insurance FAQs

Tuesday May 8, 2018

Category: Uncategorized

What is Auto Insurance?

Ontario Auto Insurance is a financial service provided by insurance companies. Auto insurance provides financial protection to drivers in the event of an driving related accident or theft. Individual drivers pay an annual premium to an insurance company and, if they are involved in an accident or theft, the insurance provider covers most or all costs related to the incident.


How does Ontario Auto Insurance work?

Ontario Auto Insurance is a “no-fault” insurance system. The name of the system is a bit misleading because it does not mean no one is at fault in the event of an accident. A no-fault system simply means that, in the event of an accident, each driver works with their own insurance provider to resolve any claims made in in the incident.

The purpose of the no fault system is to minimize delays in getting the affected parties the benefits or treatments they may require.


Is Auto Insurance Mandatory in Ontario?

Yes. Auto insurance is mandatory in Ontario. At minimum, Ontario drivers must have $200,000 in third party liability coverage. This coverage protects you in the event you are found responsible for damage to someone else’s property or injuries as a result of an incident. However, many drivers choose to purchase added coverage for protection of $1,000,000 to $2,000,000.


What is the penalty for driving without insurance?

If you are caught driving without insurance, you can be charged from $500 to $50,000 depending on if it is your first or second offence. And to make matters worse, if you are involved in an accident without insurance, you will be responsible to pay all the costs out of your own pocket.  


How much is Ontario Auto Insurance?

The rates charged by insurance companies are monitored by the Financial Services Commission of Ontario (FSCO). According to an article published by Global News in January 2018, the average Ontario driver pays an annual premium of $1,458 for car insurance.


How are insurance rates determined?

Your insurance rate is dependant on the insurance company you choose and is determined by your personal profile, the coverage you have purchased, the deductible you will pay in the event of an claim. Your personal profile includes:

The rate you get for the same coverage may vary between insurers. It is your right to shop around get the base rate for your coverage needs.


If I lend my car to a friend, are they insured?

Yes. If you lend your car to a licensed friend, they are covered under your insurance. This means, if they are involved in an accident, it is your insurance premium that is affected.

If you begin sharing your vehicle with another driver on a regular basis, you will require additional coverage from your insurance company.


Does Ontario Auto Insurance cover me out of the province?

You will need to confirm with your insurance provider if your insurance is valid while out of province. However, most policies cover drivers when they travel outside of their province or into the US. If you plan to drive in another country, check with your insurance provider to ensure your coverage applies out of province.

Is my insurance provider allowed to cancel my insurance policy?

Yes. As long they notify you, your insurer can cancel or non-renew your policy for a variety of reasons including:

If your provider cancels or non-renews your policy, contact a high risk insurance broker.


How can I get cheap insurance rates?

To get the best insurance rates, be sure to ask if you are eligible for discounts on your policy. The FSCO recommends checking with your insurance provider each year for any available discounts. According to the FSCO, insurance providers offer a range of discounts for:

To keep your insurance rate low, be sure to practice good driving habits. Keeping your driving record clean helps ensure your premium doesn’t climb.

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