Car Insurance Questions and Answers

 

 
Automobile insurance is mandatory in Ontario. However, for many, it is a confusing and even intimidating subject. Broker Colin Robinson uses his experience to help answer some of the most commonly asked questions about auto insurance in the following Q&A:
 
 
What are some of the most common myths surrounding auto insurance?
 
I would say the most common misconception is the notion that red cars are more expensive to insure than vehicles of any other colour. This is unequivocally untrue. Another myth is that two-door cars are always more expensive than those with four doors – this is also false (in fact, sometimes the opposite is true). As well, the idea that expensive vehicles cost more to insure than their more economical counterparts is a myth, as higher-priced cars often have more safety features which can lead to less injury claims, which is a major factor in determining premium.
 
 
Will a not at fault accident raise your rates?
 
No. By law, rates cannot be raised as a result of an accident that is considered to be 100 per cent not at fault. As well, rates can also not increase as a result of fire, theft, vandalism or a situation in which your car is hit while parked.
 
What type of cars are typically the least expensive to insure?
 
Family-type vehicles such as sedans and minivans typically cost the least to insure, as do pickup trucks. Also, some exotic sports cars are surprisingly frequently among the least expensive vehicles to insure due to the demographics of the drivers that often own them.
 
What insurance coverage is mandatory and what is optional?
 
Third-party liability coverage is mandatory. Available optional coverages include collision, comprehensive (fire, theft, vandalism, glass) and increased accident benefits. However, if a car is leased or financed, the manufacturer will require a full coverage policy.
 
What are the most common discounts available for car insurance policies?
 
All insurance companies offer several types of discounts to those who are eligible. These may include:
 

• Multi-vehicle discount
• Multi-policy discount
• Conviction-free discount
• Snow tire discount
• Senior discount
• Good student discount
• Renewal discount

 
 
What is waiver of depreciation coverage?
 
This coverage is available on new vehicles. It protects the full value of a car in the event of a write-off for the first 24-48 months of ownership, depending on the company.
 
What is accident forgiveness coverage?
 
For those who are eligible, most insurance companies will “forgive” a driver’s first at-fault accident, which as a result will not cause a rate increase at time of renewal.
 
Colin Robinson has been a registered insurance broker in Ontario for 27 years. He specializes in auto, home, business and life insurance.