Understanding Ontario Auto Insurance

No one actually wants to have to pay for auto insurance, but it is something that we all must have.

In Ontario, it is required by law that all motorists carry auto insurance, and vehicle owners who do not have insurance can face some pretty heavy fines when they are caught, ranging anywhere from $5,000 to $50,000. Not only do you face receiving fines, but you may even have your driver’s license taken away from you, and your vehicle may be impounded.

Here are some things you should know so that you can understand Ontario auto insurance and how the rules apply to you:

  • If you have been convicted of driving without possessing valid automobile insurance, you will find that you are not going to be able to get the best insurance rates when you are able to get it again. You will be considered a “high risk” driver, and some companies may even refuse to sell you auto insurance at all.
  • If you are in an uninsured vehicle, either as a driver or as a passenger, you may not be entitled to any income replacement if you are injured in an accident. To take this even further, it may be that you are not even allowed to sue the driver who is at fault in the accident if it is not you, no matter how serious your injuries may be.
  • If you are a driver of a vehicle that is uninsured, and you are at fault in an accident that results in the injury or death of another, you may be required to cover all medical and other costs of the injured party yourself, which is going to end up coming right out of your pocket.
  • You have several options for buying auto insurance in Ontario. You can use the services of an insurance broker, who will work to get you the best price on the policy that is right for you. You may want to work directly with an insurance agent, or you may want to have a direct writer. You can find all three in any number of ways, such as by asking others, checking out your local yellow pages and doing an Internet search.
  • You shouldn’t always buy the first insurance policy you get a quote on. It is much better if you shop around a little bit. Each insurance company is going to offer something just a little bit different, and you may find that some policies include things you don’t need, but are paying top dollar for, or that you are not getting enough insurance with the policy. Take a look at what different insurers have to offer, and make your decision based on the information you receive.
  • You will be required to provide certain pieces of information in order to get a correct estimate for a policy. Insurers are going to want to know some basic information about you, the make and year of your vehicle, your driving record, if others are going to be driving on the policy, etc.
  • In Ontario, you are required to carry a certain amount of automobile insurance. You need to have third-party liability coverage, statutory accident benefits coverage, direct compensation-property damage coverage and uninsured automobile coverage.
  • Third-party liability insurance will protect you if there is an accident and someone is killed or injured, or their property is damaged. If there are lawsuits as a result of the accident, this insurance will pay for claims, and you must carry a minimum of $200,000 in third-party liability insurance.
  • Statutory accident benefits coverage will provide you with compensation in the event that you are injured in an auto accident. This insurance covers you no matter who is at fault, and coverage includes medical, supplementary, rehabilitation, caregiver, attendant, and non-earner and income replacement benefits.
  • Direct compensation-property damage coverage pays for damage to your vehicle and its contents, or the loss of your vehicle and its contents. The reason it is called direct coverage is because even if someone else is at fault for the accident, you will collect these benefits right from your own insurer. This coverage is only applicable if the accident took place in Ontario, there was at least one other vehicle involved, and at least one other vehicle involved is insured in Ontario.
  • Auto insurance rates are set using a number of factors, including: the type of vehicle you drive; your driving record; how often and how far you drive; whether your car is for business or pleasure; where you live; and how old you are.
  • Uninsured automobile coverage means that if you are involved in an accident where an uninsured driver is at fault, you will still be protected.
  • You are not limited to the minimum amount of insurance coverage. As long as you do have the minimum required, you may purchase as much extra insurance as you can afford to. This way, you will know that you will have nothing to worry about financially if you are involved in an automobile accident.
  • Some things are not going to be covered by your auto insurance. For instance, if you have a breakdown or a flat tire, you are going to be on your own, unless the problem is the direct result of an auto accident.
  • If you let anyone else drive your vehicle who is impaired, or has a driving conviction, your insurance company can and will deny payment if this person has an accident while driving your vehicle.

If you are buying your first car, you need to start looking for insurance.

It makes absolutely no sense not to. It is against the law not to have it, and if you do not, you may find yourself in a heap of trouble, not only legally, but financially as well. Shop around for the best policy, and make sure that when you get behind the wheel, you, and your passengers, are always going to be covered in case of an accident. If you are already insured, you may want to look into increasing the amount of coverage you carry, especially if you have a family and want to make sure they are protected as well.

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