10 Best Car Insurance for Young Drivers

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There’s nothing better than that feeling when all your hard work has finally paid off and you get told you passed your Canadian driving test.

There is a level of responsibility that comes with that freedom, however, and one of the most important things you need to consider is your car insurance.

There are a lot of options out there for you and finding the right one for you can feel like an uphill battle.

It doesn’t have to be, and to help you out we have compiled our top 10 car insurance companies in Canada for young drivers.

Let’s dive in…

What to consider when looking for car insurance?

We’ll be honest and give you the bad news first – your insurance premium is going to be higher because you are a young driver.  There is very little to be done about that, but that doesn’t mean you can’t find a reasonable rate to get you on the road safely.

There are also ways of helping prove yourself as a safe driver quicker, to at least bring the premium down a little. 

In general, however, there is a very clear milestone of 7 years that you need to hit before you see significant decreases in your premium.  That is, you need to have 7 years of safe driving history under your belt to qualify for those better rates.

What influences your premium price?

As we’ve mentioned, your age is a big factor in the decision-making that goes into pricing your premium.  It’s not the only thing, however.  There are other factors that are also important to understand that can and will affect your premium.

Let’s have a quick look at those too:

Address –  where you live can have a big impact.  Someone who lives and drives in a city, for example, will pay a higher premium than someone that lives and drives out in the country, because of the added risk from more drivers being on the road.

Type of vehicle – the type of vehicle you are driving is also an important determining factor for your premium.  The insurance companies will have their own set of metrics for this that may vary but will ultimately be based on the speed, power, safety features, age, and size of the vehicle.

Driving history – your driving history is also important, and as a new young driver, you have no history for them to base your driving skills and safety from.  This automatically puts you in the highest risk category until you have more driving experience under your belt.

Car usage – what you intend to use the car for is also important.  Someone who intends to use their car every day will pay a higher premium than someone who will only use it for occasional commuting.

What types of insurance cover can you get?

Liability/Third Party cover

This is the base legal requirements for car insurance cover that you need to drive on the roads.  It simply covers the damage caused to third-party vehicles.  It does not cover the repair costs for the damage to your car, or any injury cover, etc.

It is strongly recommended to get more than just third-party cover, as tempting as those lower premiums might be.

Comprehensive cover

Comprehensive cover means you will be able to reclaim the repair costs of your vehicle if it is damaged through vandalism or adverse weather.  Again, it won’t cover your car in the event of an accident.  For that, you will need collision cover.

Collision Cover

As we’ve said, this is the policy that means any damage to your vehicle in the event of an accident is covered.

Uninsured motorist cover

While this isn’t mandatory, it certainly is recommended and is often included in an insurer’s base offer.  This policy covers you in the event of an accident with someone who is uninsured and the fault is with them.

Medical payment cover

Similarly, this isn’t mandatory but is often good to have.  In the event of an accident that wasn’t your fault, this will cover your medical bills.

Pay as you drive cover

This is an important one to look out for as a young driver.  It is relatively new, but it is a way of reducing your premium after only 90 days.  Here’s how it works.

A smart box is installed in your car that monitors your driving.  At the end of a 90-day period, the insurers will take and analyze the data from the box to determine whether you are a safe driver.  This data will then influence their decision on whether to decrease your premium, keep it the same, or increase.

Assuming you are and will be a safe driver, this is a great way of accelerating your access to reduced premiums for your car insurance.

Our top 10 car insurance companies for young drivers in Canada

Now let’s dive into the 10 best insurance companies for young drivers in Canada:

Desjardins is especially good for newer and younger drivers and have some of the best rates, and impressive discounts for their various coverage options.

As standard their policy includes comprehensive, third party, collision, uninsured drivers, family protection, and SCPD, which is great.

The Co-Operators are arguably the number one insurance company in the market at the moment and for good reason.

With over $47 billion in assets under administration and a team that consists of 6000 plus employees, they are a company you can trust to know what they are doing.

They offer a great range of services and packages for drivers.  Their quoting system is quick and easy, and they are continually commended for their customer service too, so if any problems do crop up you know you are in supportive hands.

Sonnet is based entirely online and offers incredibly quick quoting.  They get an A+ rating from the Better Business Bureau, which is great.

Their base car insurance covers accident, liability, collision, and is fully comprehensive, so you know from the outset you have all the necessary bases covered.

They can be on the more expensive side of things, 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 a well-loved insurer all over the country, though is particularly popular in Quebec and Ontario.

Their standard cover includes third party, collision, accident benefits, and uninsured drivers.  You can easily add full comprehensive cover too 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.

Their unique “my Drive” program is particularly interesting and will reward its policyholders for safe driving with some great discounts. 

They also have a great catalog of tips on improving driving habits to help you drive down premiums.

For those drivers that are not looking for a lot of use out of their car then Belairdirect is a great choice.  They offer some incredible discounts for drivers with low mileage – 15% discount for driving less than 10,000km over the year.

Their basic cover includes uninsured motorists, accident benefit, and liability cover, which is great, though comprehensive and collision are both addons.

Aviva Canada is a subsidiary of one of the largest insurers in the UK and is 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).

TD Insurance is one of the cheapest insurers on the market as well as being one of the biggest. 

Their quoting process is quick and easy, with some great discounts on offer, and coverage packages to suit every need.

Economical Insurance is a great option if you are looking for some unique addons like loss of wage cover if an accident means you can’t work, or legal cover, etc.

They also score very highly for customer service and are a great option for a variety of vehicle insurances.

RSA is another great insurer that has an A+ rating with the Better Business Bureau which is great.

They have some great discounts and optional coverage on offer. 

What we particularly like about RSA is its 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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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.