Car insurance in Canada
Are you looking to get a better understanding of how car insurance works in Canada? Did you know it differs from province to province? There is such thing as both private and public insurance when it comes to protecting your vehicle. By law, you must purchase mandatory car insurance and then you can purchase additional, optional coverages to suit your needs. Since it’s illegal to drive your car without insurance, not to mention insurance is there to protect you as the owner/driver, it’s a good idea to really understand how it works and what type of insurance you need to purchase before you hit the open road. Or any road for that matter.
How does car insurance work in Canada?
Because it changes from province to province, there isn’t a one size fits all answer to this question. And although car insurance is mandatory from coast to coast, it is regulated on a provincial level, not nationally. Then, car insurance in Canada is also divided into public insurance and private insurance. But of course, just to keep things interesting, some provinces run on a bit of a hybrid of both systems. Let’s jump in to see examples of these different types and how they differ.
What’s public car insurance?
Public car insurance means that the company that provides the insurance for your car (and everyone else in that province who buys car insurance) is a government-owned corporation. With the public insurance system, you may also have the option to increase your coverage with a privately-owned, publicly traded, or mutual insurance company.
What’s private car insurance?
Private car insurance means that the companies that offer insurance to you (and everyone else in the province) are privately owned, publicly traded, or mutual companies. For example, TD Insurance is a wholly owned subsidiary of TD Bank, which is a publicly traded company, and we offer many different types of car insurance coverages.
What provinces currently offer public vs private car insurance?
In British Columbia, Saskatchewan and Manitoba, the government runs the car insurance industry. However, in British Columbia only, non-public insurers can offer optional additional coverages. In all the other provinces and territories, privately run insurers provide car insurance. Except for Quebec, which uses a hybrid model of the two. In Quebec, the public insurer manages insurance for bodily injuries only, the other coverages (for example, Civil Liability, Collision and/or Comprehensive) are provided by private insurers.1
What types of car insurance are there in Canada?
As we mentioned above, there is mandatory insurance that differs from province to province and there is also enhanced coverage (also referred to as optional or add-ons). Below are some of the coverages that are offered through TD Insurance:
- Liability – If you injure someone or damage property and are sued for damages, the cost of those damages may be covered.
- Accident Benefits – Provides benefits if you are injured in an automobile accident, regardless of who caused the accident.
- Direct Compensation – Damages to your car are covered by your insurer if you're not at fault. However,
at-faultdamages would be covered by optional collision coverage.
- Uninsured Automobile Coverage – Medical costs and damage are covered if an uninsured driver is at fault.
- Specified Perils – Protects your vehicle from specified perils such as losses caused by fire, floods, hail or theft.
- Comprehensive – Covers all other insured damage caused to your vehicle (except collision or upset).
- Collision or Upset – Covers damage to your vehicle caused by a traffic collision with another vehicle or object.
- All Perils – This option combines the coverages of Collision or Upset and Comprehensive.
How do I get car insurance?
For private car insurance, most insurance providers offer online quotes and that’s the perfect first step. With TD Insurance you can get a quote online in minutes. And then you can either purchase your insurance online or you can do it over the phone with a TD Insurance licenced advisor. It’s a quick, easy and convenient process from beginning to end. If you’re looking for more information you can also read this introduction on how to get car insurance.
For public car insurance, it’s best to check with the government-owned corporation to get the most accurate information on how to get the right car insurance.
How are car insurance premiums calculated?
Whether your insurance is provided by a public or private insurer, there are different factors such as the type of car you drive, your driving record, and the type of coverage you choose that all affect how much you pay. Here is some more detailed information about how car insurance premiums are calculated.
Are there any ways I can save on my car insurance?
Yes, of course there are lots of opportunities to save with TD Insurance. From bundling your home and car insurance together to receiving preferred rates for being an alumni or professional, there are many different ways to save. Check out these simple tips to help you save on car insurance.