If you live in Ontario and drive a vehicle, you are required to have auto insurance. Fines for drivers who do not carry valid auto insurance can range from $5,000 to $50,000. In addition to these fines, your driver's licence may be suspended and your car could be impounded.
After you've been convicted of driving without valid auto insurance, you will be considered a "high-risk" driver. And this will make it harder and more expensive for you to get insurance. Some providers might refuse you altogether. Or, if a company agrees to sell you coverage, you will be charged higher premiums.
So, it is important to know exactly what kind of auto insurance you need before getting behind the wheel. You should also have an idea as to where you should buy your policy.
Understanding the Standard Auto Insurance Policy
Owning and operating a vehicle in Ontario requires you to carry at least minimal insurance coverage. This basic policy is often referred to as a "standard auto insurance policy." And there are four parts to this coverage.
Third-Party Liability Coverage
This section of your policy protects you if another person is killed or injured in an accident that you're involved in. It will also cover damaged property that doesn't belong to you. If someone files a collision-related lawsuit against you, this insurance will pay for claims up to the limit of your coverage. You must carry at least $200,000 in Third-Party Liability Coverage, but you can choose to carry more.
Statutory Accidents Benefits Coverage
This section will provide you with medical and financial benefits if you are injured in an accident. Even if the accident is your fault, you will get rehabilitation care. Also, if you are forced to be out of work because of an injury, you will receive at least a portion of your income while you are recovering. Non-earners and caregivers are also compensated for time spent away from their responsibilities.
Direct Compensation or Property Damage (DC-PD) Coverage
This section will pay for damage done to your vehicle or its contents as a result of an accident. If your car is totaled, the current value of the vehicle will be covered by the insurance. It is called Direct Compensation even if someone else causes the damage because you still collect directly from your own insurer. There are conditions that must be met for the DC-PD section of your policy to apply:
1) The accident must take place in Ontario.
2) There must be at least one other vehicle involved in the accident.
3) At least one of the other cars involved must be insured by a company that is licensed in Ontario or has signed an agreement with FSCO to provide coverage.
Uninsured Automobile Coverage
This section will protect you and your family if you are injured or killed by a hit-and-run driver or by someone who is uninsured. It will also cover damage done to your vehicle caused by an identified driver who carries no insurance.
Depending on your needs, there are several optional types of insurance coverage that you can carry. Just make sure that you at least meet the minimum requirements and that you obtain your policy from a licensed source.
Where to Buy Your Auto Insurance Policy
When you need to purchase a policy, you have three options. You can find an insurance broker, contact an insurance agent or go to a direct writer.
- Insurance Brokers: These individuals sell insurance on behalf of several different insurance companies. They are supposed to find you the best rate offered by the providers they represent.
- Insurance Agents: As opposed to brokers, agents usually only represent one insurance company.
- Direct Writers: These are insurance companies that sell their products directly to consumers.
You will find that rates vary among insurers, so you should shop around before deciding which company to work with. Ask your friends and family members to recommend a provider. Or, you can visit myinsuranceshopper.ca in order to compare policies and prices. Here, you can get free quotes from several companies all in one place.
Auto Financing Assistance in Ontario
Buying a car to insure can be difficult when you are dealing with credit issues. But if you have less than perfect credit in Ontario or any other province or territory, Canada Auto Loan can help you get the auto financing you need.
We can match you with a dealership in your area that is qualified to give you your best chance at an auto loan approval. There is no charge or obligation attached to the service we provide, so you have nothing to lose. Let us show you how easy and hassle-free buying your next car can be. Just fill out our simple and secure online application to get started today.