The rules and regulations around car insurance vary dramatically across Canada. In British Columbia and Manitoba, insurance is public and is managed through government corporations. Residents of Saskatchewan pay for compulsory insurance through the government and extension coverage through private providers. In Quebec, personal injury coverage is administered by the government, while coverage for property damage is provided by private insurers.
In the rest of the provinces and territories, automotive insurance is an entirely private enterprise. This means that rates can vary dramatically in these markets depending on a variety of factors such as the driver’s age, gender, and postal code, as well as the make and model of the vehicle and the driving record of the person being insured.
How do you know if the rates your insurance company charges are reasonable, and what can you do to ensure you’re paying the lowest amount possible for car insurance? Read on for tips and advice on how to find the lowest auto insurance rates in Canadian jurisdictions with private providers.
What’s the Average Insurance Policy Rate in my Province?
According to the most recent data published by the Insurance Bureau of Canada in August 2019, residents of British Columbia pay the highest average annual premium in the country under the province’s government-run monopoly, with an average rate of $1,832 per year.
Ontario’s rates are the second-highest at $1,505 – though the province registered an average rate increase of 1.56 percent early in 2020 according to a CBC report, bringing that figure up to $1,528 – and Alberta rounds out the top three at an average of $1,316.
Saskatchewan comes next at $1,235, followed by Newfoundland and Labrador at $1,168, Manitoba at $1,140, Nova Scotia at $891, New Brunswick at $867, Prince Edward Island at $816, and Quebec at $717. Average figures for the three territories of Nunavut, Northwest Territories, and Yukon are not published.
Tips for Getting the Cheapest Car Insurance Rates
The nuances of which factors affect auto insurance rates the most vary across Canada, so some may make more of a difference in your province than others. Here are a few things worth looking into or asking your insurer about to try to get yourself the lowest possible insurance rate.
Choose your vehicle carefully. Certain types of vehicles have lower safety ratings or are stolen more frequently, and these will tend to have higher rates. The types of vehicles affected by these differences may surprise you – this isn’t exclusive to flashy sports cars! Three-row family-oriented SUVs can be frequent targets for theft because they’re easier for illicit sellers to flip on the used vehicle market. If you’re considering purchasing a new car or a new-to-you vehicle, always call your insurer to ask about the rate before you commit to a purchase. This step is essential to prevent you from shouldering nasty surprises.
Don’t be afraid to shop around. Even if nothing about your situation changes from one year to the next, it’s worth taking a few minutes to visit some online rate estimators and see what the various insurance providers are willing to offer. Some drivers find that their insurers post annual increases that add up over time, and simply switching to a different insurance company that’s willing to offer a better deal can erase some of those gains.
Opt for a higher deductible. This is a simple gamble: if you’re confident you can afford to pay more in the event of an incident, you can pay less overall for your policy by selecting a higher deductible. A policy with a deductible of $1,000 will cost less than one with a deductible of $500 because you’re covering more of the insurer’s costs at the time of the incident. However, you’ll need to ensure that you have the money in reserve to float this extra expense should it become necessary to do so.
Pay your premium all at once. Many insurers will offer a discount to drivers who pay their premium in full annually as opposed to in monthly installments. If you can afford a lump-sum payment, ask your insurance company to quote for both scenarios to see whether you’re missing out on an opportunity for savings.
Keep all your insurance with one provider. If you also have home insurance or coverage on your cottage, boat, RV, or motorcycle, for example, many insurers will give you lower insurance premiums on each of these products if you opt to keep them together with a single provider. The difference from bundling your auto insurance policy with other coverage can range from 5 to 25 percent lower rates depending on the policy.
Examine exactly what kind of insurance you need. Every jurisdiction will have a minimum amount of insurance that’s required by law, but in some cases you may be paying for supplemental coverage you don’t really need. For example, if you’re driving a beater that would be easy for you to replace if it’s totalled in a car accident, collision coverage may not be the best use of your money. If you could easily afford to replace a vehicle that's written off due to some other circumstance such as being crushed by a fallen tree, comprehensive coverage may not be a good use of your money. Have a discussion with your insurance provider to discuss your needs and situation to see whether removing some types of insurance coverage may be right for you.
Install winter tires. Many insurance companies will reward drivers who choose to install winter tires in the colder months, and in some provinces, they’re required to do so by law. This is because winter tires make a real difference in driving safety: the rubber on all-season or summer tires hardens at temperatures below 7 degrees Celsius, which reduces its ability to grip to the road’s surface. Winter tire rubber is more pliable at lower temperatures, and the tread is designed to more effectively retain traction in snow, slush, and ice. As a result, installing winter tires makes you a safer road user when the temperatures drop, and your insurer is likely to reward you for it. Just make sure you actually do install those tires and keep the receipts for the work in case you’re asked for them.
Look into usage-based insurance. If you drive a lot less than average and don’t mind using telematics to prove it, switching to a usage-based insurance plan could lower your insurance costs by as much as 25 percent. These types of plans tend to offer the most benefit to drivers with good records who live in higher-risk areas such as cities and who drive occasionally rather than commuting daily. A device plugged into your car or an app installed on your mobile phone will track your driving habits and send data to your insurance company, which allows them to verify your usage and lower your rates accordingly.
Don’t allow for a gap in your insurance history. Insurers don’t look kindly on drivers who suddenly go uninsured for a period of time. Even if you need to sell your car and go without a vehicle for a while, it’s best to retain a car insurance policy of some kind, whether that be one that insures you for third-party vehicle such as car-sharing services, or having yourself added as a secondary driver to a trusted family member’s policy. Different insurers will be able to offer different solutions in this situation, so don’t be afraid to ask around.
Ask about organizational discounts. Your employer, alumni association, or some other group membership or professional association may offer insurance savings. Check with these organizations to see whether they have made arrangements for discounted rates with specific insurance providers.
Just be a safe driver. Drivers who can demonstrate to insurers that they’re lower risk by maintaining a clean driving record and not piling up on speeding tickets and accidents will always be quoted the best rates by insurers. These types of incidents stay on your driving history for years. When you’re running late and feel tempted to speed or engage in risky driving behaviours, think of the bigger picture: the potential increase in your insurance rates in the event you’re caught or cause a crash is simply not worth it.