Important factors to know about car insurance in Canada

Important factors to know about car insurance in Canada

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You must have vehicle insurance if you own a car or other vehicle.

Car insurance may protect you from:

  • having to pay to repair your car or other vehicle if it’s damaged or in an accident
  • liability claims if you’re held accountable for an accident causing damage to other person’s vehicle or injury to other people

Newcomer’s guide for Car Insurance in Canada

Insurance could be a non-negotiable necessity that you should invest in if you propose to temporarily or permanently stay in Canada just because it gives you the peace of mind that you simply are financially protected just in case of an emergency.​

We all know you’ll enjoy your stay here. Moving to a different country would require driving. A Canadian driver’s license is required if you wish to drive in Canada. If you wish to drive within Canada, you’ll use your license only within 60 days. However, if you wish to use for a Canadian driver’s license for a extended period of your time, taking an exam for that’s mandatory.

If you’ve got your license already, here are some requirements to recollect before you begin hitting the road:
If you get or own a car, you’re required money.
If you’ll be driving a car that belongs to a relative or friend, confirm you’re listed on their insurance plan.

It is ideal to buy insurance for a car you’ll be renting. Just ensure to double-check which of them are already covered by your travel contract and credit cards to avoid overspending on these policies.

 Car insurance policy covers

If you get into a car crash, your vehicle insurance may cover:​

  • the driver
  • all passengers
  • other people who are involved

In some provinces, injured passengers or others involved within the accident who have their own policy must make a claim under their policy first.

Types of Mandatory car insurance in Canada

Third-party vehicle insurance

If you’ve got caused an accident, your third-party insurance will cover the medical treatment and repair costs of the people you injured and therefore the damaged properties. Once the injuries are healed, and therefore the repairs are done, the claim are closed.

In Canada, third-party insurance starts at $200,000.

Statutory Accident Benefits

If you bought into an accident, your accident benefits would help cover any expenses for the rehabilitation, income replacement, attendant care, and funeral expenses (up to a specific limit) for you, your passenger, and other third-party individuals like another motorist or pedestrian, no matter who was guilty.

This type of insurance is usually set at $1,000,000, and its benefit payouts are the priciest among the insurance.

Uninsured/Underinsured Motorist

This car insurance will cover the medical bills incurred from the injuries you and your relations sustain during a crash caused by a driver without insurance. Should your uninsured driver be identified, this insurance can even cover the damages done to your vehicle. If nobody is guilty, the repairs to your vehicle are covered by this  vehicle insurance.

How an insurance company calculates premiums

Premiums are the amount you pay to buy insurance.

When determining how much you’ll pay for premiums, insurance companies may consider factors such as:

  • your age
  • your gender
  • where you live
  • what car you drive
  • how much you use your car
  • your driving record
  • your claim history
  • the type of coverage you choose
  • the amount of your deductible

A deductible is the amount of your claim you agree to pay before your car insurance company pays the rest.