What You Need to Know About Car Insurance Companies in Canada

Regardless of where you live in Canada, as long as you own or drive a vehicle, auto insurance is essential coverage that you need to add to your possessions.

Each province and territory in Canada determine the minimum insurance coverage. Still, there are general similarities in the Canadian car insurance industry, including coverage types, optional coverages, car insurance premiums, etc.

Just as there are different types of car insurance providers across the various Canadian provinces, the rates charged by insurers also vary in hundreds and thousands of dollars. Each of the numerous car insurance providers in Canada has its unique services and rates, which cut across the provinces and territories in the Great White North.

Is Car Insurance Mandatory in Canada?

Auto insurance is a legal requirement for drivers and vehicle owners everywhere in Canada. Car insurance covers the owner and drivers of a vehicle, including the passengers, pedestrians, and any other property that may be involved in an accident. As a result, anyone caught driving without a valid car insurance policy will be charged with the payment of fines, license suspension, and vehicle impoundment.

Although car insurance is mandatory in all Canadian provinces and territories, each region has its established minimum coverage adhered to by drivers and vehicle owners. Consequently, Canadian vehicle owners must obtain proper auto insurance coverage from accredited and licensed insurance companies operating in their province.

Who Provides Car Insurance in Canada?

There are tons of car insurance providers in Canada. You can buy a car insurance policy coverage from a licensed insurance broker, agent, or company.

Insurance Broker

A broker is an insurance provider that offers the best available insurance rates from different insurance companies that he/she represents. The brokers shuffle through the insurance market to find the best insurance companies for you regarding your coverage needs at the most affordable rates.

Insurance Agents

An insurance agent typically sells car insurance for a single insurance company that he/she represents. For instance, an insurance agent for TD Insurance will offer you the services and rates of the company to convince you to buy insurance only from TD Insurance that he/she represents.

Direct Writer

A direct writer is an insurance representative who works for an insurance company that sells car insurance directly to drivers and vehicle owners.

Types of Car Insurance in Canada

In Canada, owners and drivers of vehicles are provided with two distinct options to buy their auto insurance, depending on their province. In some regions, independent or private insurance companies and brokers offer car insurance, while in other provinces and territories, car insurance coverage is provided by private and government-owned institutions.

For instance, drivers in Albert, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, and Prince Edward Island are buying their auto insurance coverages from private companies and insurance providers.

Residents of British Columbia, Manitoba, Quebéc, and Saskatchewan can get auto insurance through private and government-owned insurance companies. Drivers in Quebéc enjoy public insurance coverage for injuries or death, while private or independent insurance coverage is provided on property damage.

Here’s how vehicle/auto insurance is offered in Canada:

Province/TerritoryTypes of Car Insurance
AlbertaPrivate
British Columbia Private and Public
Manitoba Private and Public
New Brunswick Private
Newfoundland and LabradorPrivate
Nova Scotia Private
Ontario Private
Prince Edward Island Private
Quebéc Private and Public
Saskatchewan Private and Public

Source: Canadian Visa

Important Things to Consider for Car Insurance in Canada

  1. As a vehicle owner or driver, you need to determine the type of mandatory coverage in your province or territory.
  2. Determine the type of coverage that you need, including endorsements, by outlining your risks and how to compensate them.
  3. Determine what type of car insurance is available in your province – private and public.
  4. Consider which licensed car insurance provider is best for you in terms of your coverage needs and affordable rates.
  5. Determine the payments that best suit your budgets, that is, monthly premium or annual premium payments.

How to Buy Car Insurance in Canada

When you’ve determined your car insurance needs, it is essential to consider how you want to buy your auto insurance policy. This is done by getting insurance quotes to pick the best deal that suits your plan. There are two distinct methods to get auto insurance quotes from insurance providers.

  1. Get a quote directly from car insurance providers – brokers, agents, or companies.
  2. Get a quote through insurance search platforms, with multiple choice.

How Car Insurance Companies Determine Rates

Insurance costs money, but it varies between insurance companies and provinces. Insurance companies across Canada consider several factors in determining car insurance rates and quotes. Here are some of the factors that affect car insurance premiums.

  • The make, model, and year of your vehicle in terms of the value of repair or replacement, and safety ratings.
  • The geographical location of the policyholder in terms of risk factors, accident, and insurance claim history of the neighborhood.
  • The driving record and experience of the people who are insured to drive the vehicle.
  • The insurance claim history of the driver or policyholder.
  • The commuting history of the vehicle, that is, how much time is spent on the road and where you commute.
  • The type of car insurance policy coverage and additional coverages chosen by the insured.
  • The age, gender, and marital status of the driver.
  • The amount of car insurance deductibles.

Do Car Insurance Companies Share my Information?

Insurance companies do not discuss an individual’s driving record, vehicle record, or insurance claim history with other insurance providers in determining auto insurance rates. Canadian privacy laws protect most of your personal information.

Nevertheless, auto insurance companies have some exceptions by law to draw from a general pool of information. This information can include your driving record, claim history, accident statistics, credit score, and more.

The Personal Information Protection and Electronic Documents Act (known as Bill S-4) allows information disclosure without consent or other oversight from car insurance companies if there’s a reasonable suspicion of illegality or fraudulent activity, especially in terms of discovery and the prevention of insurance frauds.

Regulations of Car Insurance Companies in Canada

Both federal and provincial regulatory bodies regulate private and government-owned car insurance companies in Canada. The services and rates of these insurers are regularly reviewed and extensively regulated.

At the federal level, the Office of the Superintendent of Financial Institutions (OSFI) regulates the solvency and financial healthiness of private insurance companies that are registered under federal statutes.

Also, provincial regulators oversee how car insurance companies assess risks, determine prices, and handle claims. Besides, provincial superintendents of insurance license insurance companies, regulate insurance products and market conduct, and regulate solvency and financial strength of the companies incorporated in their province.

Insurance Regulators by Province and Territories

Province/TerritoryRegulator
AlbertaAlberta Superintendent of Insurance
British Columbia BC Financial Services Authority (BCFSA)
SaskatchewanFinancial and Consumer Affairs Authority (FCAA)
Manitoba Financial Institutions Regulation Branch (FIRB)
Ontario Financial Services Regulatory Authority of Ontario (FSRA)
New Brunswick Financial and Consumer Services Commission (FCNB)
Nova Scotia Office of the Superintendent of Insurance
Newfoundland and Labrador Superintendent of Insurance
Prince Edward Island Office of the Superintendent of Insurance
QuebécAutorité des marchés financiers (AMF)
Northwest Territories Office of the Superintendent of Insurance
NunavutOffice of the Superintendent of Insurance
YukonOffice of the Superintendent of Insurance

Source: Insurance Bureau of Canada

Other regulatory bodies include the Insurance Bureau of Canada (IBC), Canadian Council of Insurance Regulators (CCIR), etc.

Auto Insurance Companies in Canada

There are several licensed car insurance companies (private and public) operating across the Canadian provinces and territories. The following are some of the best car insurance providers in Canada:

  • TD Insurance.
  • RBC Insurance.
  • Aviva Canada.
  • Johnson Insurance.
  • Intact Insurance.
  • Alberta Motor Association.
  • Desjardins General.
  • Allstate Insurance.
  • Belairdirect.
  • Economical Insurance Group.
  • RSA Canada Group.
  • Sonnet.
  • The Personal Insurance.
  • The Co-operators Insurance.
  • Canadian Automobile Association.

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