10 Best Car Insurance for New Drivers

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So, you’ve passed your test and got your first car. Congratulations! You’re now one of Canada’s newest drivers. The freedom you now have is fantastic but shouldn’t be taken for granted.

More importantly, for you to get out onto the road safely you want to make sure you have the right motor insurance.

Finding the best option can be hard, however, especially as most of the time it seems like insurers are far more favorable to more experienced drivers (which they are!).

That’s not to say that there aren’t reasonable rates to be found out there. And to make your lives a little easier we have compiled our top 10 insurers for new drivers.

Let’s dive in…

What to consider when looking for insurance

First, however, let’s just get a bit of a better understanding of what it is you are looking for from your insurance policy, what influences their premium pricing, and what kind of cover you can get.

The first thing to note, as we’ve said above, is that insurers definitely prefer experienced drivers.

If considered logically this makes sense.  Insurers are risk-averse and new drivers are considered a higher risk because of their lack of experience.

All things are not equal in the risk weighing game either. Women are considered safer drivers than men, especially when they are younger newer drivers, and age plays a big part in determining your premium level.

There are a few things you can do to help bring your premium down a little quicker, like pay as you drive cover, which we will go into below.

Going Direct vs Using a search platform

Finding a quote for your car insurance is very easy, and there are two routes you can go down to get them – go direct to the insurance company or use a search platform.

There are pros and cons to both – going direct usually means you can get a much better deal from that provider as they won’t have the platform fee to pay, and you can create a bundle that works specifically for you.  Using a search platform, however, means you have more options, and you may find a better deal than you would never know about only looking in one place.

There is no right answer here, but our list of insurers below is aimed to help you target the right insurer for you, and help you push to find the best premium possible.

What influences your premium price?

The initial questions you will be asked on the insurance for are their primary determinants of your premium, though the deeper questions that come later can influence their initial quote.

Primarily, however, premium quotes are generated based on the following:

Age – your age is a big factor.  The younger you are, the higher your premium.  There is very little to be done about this in reality, though as we’ve said, pay as you drive cover may help bring the premium down a little.

Address – where you live can have a big impact on your premium.  Inner-city, for example, will be deemed a higher risk because of the density of cars and accidents, and so will generate a higher premium.

Type of vehicle – insurers will also take the type of vehicle into consideration.  The age of the vehicle, its power, ifs safety features are all considerations that are then matched against your age to determine the risk associated with that car.

Driving history – your driving history is a key factor, and as a new driver, you won’t have any history, which will put you in the highest risk category.  As the years pass your premiums will come down as you prove that you are a safe driver.

Car usage – this is another factor they take into considerations.  How often and for what purpose you use the vehicle will help push your premium up or down. 

What types of insurance cover can you get?

Knowing what kind of insurance to get is also important, and there are a few options to consider:

Liability cover

Also known as third-party cover, this is your very basic cover, and it simply covers the cost of the damage you cause to a third-party vehicle.  It does not cover the damage to your car!

It is recommended to get more cover than just a third party, so don’t be tempted by the lower rates.  Should anything ever happen we guarantee you will regret not having a more comprehensive cover.

Comprehensive cover

Comprehensive cover is exactly what it says, more comprehensive.  Meaning it will cover damage to your vehicle. 

More often than not it will come bundled with a collision cover, which is what actually pays for the repairs to your car.  Sometimes, however, collision cover needs to be added on, and if this is the case then be careful, as comprehensive cover without collision will only cover damage to your vehicle from anomalies like the weather or vandalism, not from an actual accident.

Uninsured motorist cover

It is not usually mandatory to have this but given that an estimated 12% of drivers in Canada are uninsured it’s wise to take it out as an addition.

Uninsured motorist cover will make sure the costs of fixing your car are covered in the event of an accident that was the other person’s fault, but they don’t have any insurance themselves.

Medical payment cover

Another optional extra that isn’t mandatory, and again covers a lacking of insurance cover from the other party.  This one in particular is to cover your medical bills in the event of an accident that wasn’t your fault.

Pay as you drive cover

This is a relatively new form of insurance and involves installing a smart box device into your car that will monitor your driving for a period of 90 days.  During those 90 days, you will have a set premium, but after they have elapsed the insurer will take the collected data and give you a new premium based on how you’ve driven over those 9 days.

This is a great way to bring your premium down sooner as a new driver, assuming you are driving sensibly!

Our top 10 car insurance companies for new drivers

Now that you have a better understanding of what you are looking for, let’s dive into the 10 best insurance companies for new drivers in Canada:

  1. The Co-Operators

The Co-Operators is one of the most popular insurers in the market and for good reason.

They have over $47 billion in assets under administration and a team that consists of 6000 plus employees.  Sometimes size does matter and knowing that your insurer is trusted by that many people makes a difference.

They offer a great range of services, and are continually commended for their customer service.

They also offer great discounts and optional additional coverages.

Sonnet operates entirely online and offers incredibly quick quoting.  They get an A+ rating from the Better Business Bureau too.

Their mandatory car insurance covers accident, liability, collision, and is fully comprehensive, which is great.

They can be on the more expensive side of things, but their insurance covers a lot of the bases you want it to cover, and by the time you add the extras with some of the other companies to match Sonnet’s policy features you’re not far off in terms of price.

The Personal Insurance is particularly popular in Quebec and Ontario, though they are well-loved all over Canada too.

Their standard cover includes third party, collision, accident benefits, and uninsured drivers.  Adding full comprehensive for other damage is also available, as well as a whole host of other great addons.

Intact Insurance is one of the largest insurance providers in the whole of North America with over five million customers.

They have some great discounts available and have a “my Drive” program that will reward its policyholders for safe driving.  It’s also a great resource for tips on improving driving habits to drive down premiums.

Their insurance covers a wide array of vehicles including motorcycles, RVs, ATVs, and boats.

Desjardins is particularly good for new drivers and offers some incredibly good rates and discounts for their various coverage options.

Their standard cover includes comprehensive, third party, collision, uninsured drivers, family protection, and SCPD, which is great.

If you’re not intending on driving long distances and only using your car for the occasional commute, then Belairdirect is a great choice.  They offer some incredible discounts for drivers with low mileage – a 15% discount for driving less than 10,000km over the year.

Their basic cover doesn’t include comprehensive, which is a shame, but it does include uninsured motorists, accident benefit, and liability cover.

Aviva Canada is actually a subsidiary of one of the largest insurers in the UK.  They are known for rewarding customers for loyalty and safe driving.  They offer discounts for no claims, no convictions, multiple cars on one policy, and multiple policies (like house and car together).

If you’re thinking about making some extra cash with your newfound driving freedom and driving for Lyft then Aviva is the perfect choice as they have a partnership with Lyft.

TD Insurance is one of the largest and one of the cheapest providers in Canada.  Their quoting process is quick and easy, with some great discounts on offer, and coverage packages to suit every need.

Economical Insurance scores very highly in customer service reviews and are a great option for a variety of vehicle insurances.

They also have some great extra coverage options including legal cover and loss of wages in the event of an accident that means you can’t work.

RSA is another great insurer that has an A+ rating with the Better Business Bureau and offers great discounts and optional coverage for everything you could possibly need.

What they are most loved for is their loyalty program and RSA AIR MILES.  Policyholders can redeem these air miles for a variety of things, not just flights, including car rental, travel, accommodation, concert tickets, and leisure products.

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Avid researcher, freelance writer, and personal finance enthusiast passionate about financial education and literacy.

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Kareena Maya

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Kareena Maya is a freelance writer focused on the personal finance and travel spaces. He frequently writes about credit cards, banking, student loans, insurance, travel rewards and more. His work has been featured in publications such as Forbes Advisor, Bankrate, Credit Karma, Finance Buzz, The Ascent and Student Loan Planner.

Kareena Maya is a freelance writer focused on the personal finance and travel spaces. He frequently writes about credit cards, banking, student loans, insurance, travel rewards and more. His work has been featured in publications such as Forbes Advisor, Bankrate, Credit Karma, Finance Buzz, The Ascent and Student Loan Planner.