Car Insurance FAQ’s

Car Insurance FAQ’s2018-10-19T15:51:50+00:00

What are some of the requirements you need to know before filling out an automobile insurance application?

Prior to submitting an application, the applicant is required to provide some vital information related to:

  • The vehicle information
  • The driver’s information
  • Information related to previous collisions, claims and driver’s conviction
  • The type of coverage you’ve applied for

What is the importance of prompt payment of premiums?

Policyholders view cheap car insurance Canada as the best option to take as it gives them a chance to save. Even with that said; it’s important to pay your premiums on time. A premium is due immediately after you receive a bill from your insurance representative.  Late payment may render your account ”delinquent.”

What do I need to know about the lapse in auto insurance coverage?

This will not be held against you unless:

  • You operate a vehicle with no insurance coverage during the lapse in coverage
  • You receive a policy cancellation for non-payment of premium
  • Your driver’s has a license conviction related suspension
  • Failure to inform the insurer about a conviction or a collision

Car insurance providers Ontario receive thousands of auto insurance related questions from customers who are ever eager to learn. The complexity of automotive insurance can explain why consumers are always asking questions about the policy. One problem for most consumers is that only a handful of them bother to read and understand a policy before applying for one. They tend to trust and rely more on the information available to them by insurance agents or brokers. In as much as this is good, it’s not the best way of tackling the issue.

Instead of overlying on the agents, you need to be proactive when shopping for auto insurance. Make it your own initiative to examine carefully the policies offered and compare car insurance quotes Ontario. That way, you can be sure of picking the right coverage. You can also take comfort from the fact that in an event of an accident; everything will be taken care of by your insurer.

Car insurance questions in Ontario cannot be exhausted as attested by the Ontario Consumer Information Center. Annually, the center receives thousands of inquiries related to auto insurance. Here is a taste of some of the frequently asked questions about car insurance in Ontario:

What is collision coverage?

Collision coverage is also provided for car insurance in Ontario. With this coverage, the insured vehicle is protected against accidental losses incurred when repairing the vehicle in case they are involved in an at-fault accident. Collision coverage usually demands a minimum deductible of about $500.

What is third party liability coverage?

In Ontario, third party liability coverage is identified as the mandatory minimum coverage one is required to hold. Whenever you cause an accident which ends up causing injuries to another person or damages property, liability coverage will come into effect. The cover requires a minimum of $200,000.

What is comprehensive coverage?

The coverage takes care of any kinds of accidents or losses caused by hazards such as theft, vandalism, fire, windstorm, lightning, earthquakes and flying objects.

What is an at-fault accident?

The Insurance Act clearly stipulates the ”Fault Determination Rules” which need to be followed when assigning the percentage of fault. It is the mandate of insurance companies to determine responsibility whenever an accident occurs.

Can you share fault in an auto collision?

Yes. An analysis of the circumstances can reveal that both the drivers were at fault. In such a case, the fault will be allocated based on the collision scenario as highlighted in the Fault Determination Rules.

Is my Car Insurance still valid if I drive in the United States?

Yes, but if you’re planning a long trip, it is advisable that you contact your Car Insurance Broker, Agent or Insurance Company as some insurance companies have underwriting rules limiting the length of time that you will be covered outside of Canada.  Contact them so they can assess your situation.

If my car is stolen or damaged, is contents of the car covered by my Car Insurance policy?

Typically no, your automobile insurance covers the driver, the passengers and, depending on your policy, the car itself. It does not cover the contents in your car.  Check your home or renters insurance as they may be covered under those policies.

What can I do to lower my Car Insurance rates?

  • Increase your deductible
  • Drop the collision coverage on an older car
  • Use the same insurance company for all your insurance needs to take advantage of package deals.
  • Installing an approved theft deterrent system in your vehicle;
  • Some cars are more expensive to insure, so you may want to find out the different cars’ ratings in the IBC publication How Cars Measure Up.
  • Follow the rules of the road and try your best not to don’t incur traffic tickets.
  • If you drive your vehicle to work, cut down on kilometres and take transit whenever possible.

Can I be refused Car Insurance in Canada?

You can be refused by an insurance company if you are considered “high-risk”, but you can’t be refused by the insurance industry as a whole or refused by them to sell you basic insurance.  See more information on Facility Insurance.

I found a better insurance rate, can I switch Insurance Companies?

You can switch insurance companies before your insurance policy expires, but be aware you may incur a penalty.  Check with your insurance company if there is a penalty and weigh that against the savings from the other insurance company.

What information is allowed to be used by an Insurance Company to determine rates?

  • Age – Younger driver rates are higher
  • Gender – Males typically pay more
  • A number of years you’ve been licensed – the longer you have been a licensed driver, the better the rates.
  • Marital Status – married drivers are considered safer
  • Your City and Postal Code –insurers have the number of claims by postal code, so if you are in one postal code, you might pay more depending on the amount of claims for that insurance company.
  • Driving Record – At fault accident can impact your rates for as long as 6 years and tickets can impart rates for 3 years.
  • Payment History – missed payments, NSF’s and lapsed policies due to non-payment can increase your rates.
  • The type of car – insurers carry statistics on each type of car for their safety record and overall claims history
  • Who will be driving or lives with you in your home?  The insurance company can ask for information for other drivers driving your vehicle or other drivers in your home.

What information is not allowed to be used by an Insurance Company to determine rates?

  • Credit history or if you own a credit card
  • Bankruptcy
  • If your vehicle is owned or leased
  • Employment status
  • Length of time you have lived in your current home;
  • Accidents where you are less than 25 percent at-fault where the accident occurred on or after September 1, 2010;
  • Not-at-fault accidents;
  • If there was a period of time you had no automobile insurance coverage.

What are the factors that influence my car insurance premiums?

There are a number of factors that will determine whether you will be provided with a cheap car insurance service or be considered a high risk by the car insurance providers establishments. These factors are: the history of your driving, the type of car that you drive, where you live in , the number of regular drivers of your vehicle, the type of car insurance coverage you choose, and the factors which are related to the industry such as regulations, taxes, inflation, and the market. All these are among the factors that will be considered when determining the premium rates that you will have to pay.

Can someone else borrow my vehicle?

Generally, as long as you have issued permission, anyone is duly licensed to drive your vehicle as long as it has proper insurance from the car insurance service providers. But what you need to know is that in the event of an accident after your friend has borrowed your car, your car insurance policies are likely to be significantly affected. It is often not recommended to lend your car to someone if they have not been listed as drivers of your vehicles because the car insurance provider service may not be liable.

How can I reduce car insurance premium rates?

In order to lower the car insurance premium rates, you can use the section of insurance quotes and make a thorough comparison of all the rates. The main advantage of this apart from having the chance of finding a cheap car insurance service provider is that there is no cost that is associated with the checking out of the car insurance quotes. There are many available networks of licensed and professional insurance databases that can help you find your cheapest means.

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