From shopping around for the best rates, to bundling your insurance services, there are a multitude of ways you can try to get cheaper car insurance in Canada - it just takes a little hunting.
A blog from Canadadrives.ca. Originally published in March 2019
Whether you live in Quebec (where they enjoy Canada's lowest insurance premiums) or BC (where the cost of living is no joke), getting the best car insurance rates from top insurers is on the mind of any driver, especially when it comes to renewal time. There are a lot of tips that even seasoned drivers don’t know about.
IBC Source: GISA & MSA data for private insurers (as of December 31, 2018), SGI Annual Report (2018), MPI Annual Report (2018), Société de l'assurance automobile du Québec (SAAQ), and ICBC Service Plan (2019)
*Ontario figure updated February 2020 by Canada Drives to reflect 1.56% average increase.
If you’re getting car insurance for the first time, fear not. These helpful tips below can apply to you as well! Here are our 13 ways you can save on car insurance.
An important note: The governments of British Columbia, Saskatchewan and Manitoba have government-run auto insurance, and in Quebec, the public insurer manages the insurance regime for bodily injuries only. If you’re from these provinces, your options for shopping around are a little more limited, but you can still pick and choose what insurance coverage options you truly need.
Usage-Based Insurance (UBI) or “telematics” is an insurance plan that is based on the kind of driving you do, versus what the insurance company thinks you do (mileage, work or pleasure, etc).
Thanks to modern tech, drivers with UBI policies can see up to 25% saved off their yearly premiums. UBI is a great starting point for “higher risk” drivers, like those in big cities, young drivers, etc, because they can see even greater savings.
Most Canadians don’t know that even adding features that improve your road safety, like snow tires or an upgraded alarm system, can reduce your premium! The rules vary province-to-province.
If you regularly change your tires every winter, keep your receipt and tire information when you call your provider. If you don’t use winter tires, but all-weather tires (different from all-season), still ask. They may offer a slightly smaller discount for using them.
Do you have renters, homeowner, boat, RV, motorcycle insurance? Do you have multiple people in your home that also need car insurance? Some providers offer steep discounts for bundling your insurance services, ranging from 5%-25% per policy.
Vehicles that have excellent crash test ratings, have low-theft scores, aren’t sporty or attract loads of attention generally get cheaper rates. Sure, it may be fun to drive a hot red sports car, but is it worth the premium? You decide.
If you’re comfortable with a greater out-of-pocket cost to you in the event of an accident, then you can consider a higher deductible, say $500, or $1000 as examples. Some companies could let you go higher than that.
Insurance is not a one-and-done purchase. If you live in Ontario, you probably pay some of the highest premiums in the country, seeing an average increase of 3.35% every year (but for many, it’s much more).
Simply put - you want to shop around if you’re in a high-competition province. As you get older, your premiums could go down. If you stay accident-free, your premiums could do down. As your car ages, your premium goes down. If you’ve stayed ticket-free...you get the point.
This may not be something you can do at the onset of finding a new policy, but it’s rather a maintenance approach. If you think you may miss or be late with a payment, be proactive and call before your payment is due.
This may sound antithetical to the previous tip, but depending on the company, it may benefit you more to stay with your existing provider.
Some companies do offer nice loyalty discounts when their customers reach milestones. Check in every few years, or call them upon renewal time and ask if they have a loyalty discount.
Gaps in insurance history is a significant signal to insurance companies that could keep your premium higher.
Even if you don’t have a car for a while, see if you can get yourself added as a secondary driver to a family or trusted friend member’s policy to keep gaps off your driving history. The more you drive, the lower your insurance.
Lastly, and this should go without saying but, tickets and accidents will hurt your premiums for a while (it takes at least 3 years from payment of a ticket for it to “fall off” your record).
The longer your driving record is with no infractions, you’ll hopefully benefit from the lowest rates available.
Depending on the age of your car, where you live and what your driving habits are like, you may not need a fully-loaded policy. Reviewing your policy annually, how much your car would go for if it had to be written off (collision coverage), etc. and cutting the excess could lower your annual premium.
Of course, find the right balance with what you’re comfortable doing. If you feel better having the coverage “just in case”, then your piece-of-mind may not be worth saving a few extra bucks every month. Just like with a higher deductible, this is all based on your comfort level.
Some insurance companies offer a decent discount on your premium if you pay all at once at your policy renewal time. They may offer a slightly smaller discount if you pay bi-annually, too.
The bonus to this, too (especially if you’re trying to consolidate your spending habits) , is that you’ll naturally avoid the risk of missing a monthly payment.
Being a member of an organization or alumni group can give you a discount on your insurance premiums. When you shop around, write down what you’re a member of and ask the provider if they have group discounts.
If your vehicle has lower market value, you may be better off saving the money on collision and comprehensive coverage. This is because your insurance policy only pays out the value of the car if it’s written-off in an accident (totalled) or stolen.
What qualifies as “comprehensive” and “collision” can vary province-to-province, so make sure you check what your policy covers specifically before removing these protections.
If you’re in the market for a new-to-you vehicle, come pick a car at Canada Drives and see what payment plans we can build for you. Apply now