About Auto Insurance
Auto insurance provides protection against loss or damage to your vehicle. It may also help protect your financial assets against loss in the event of a lawsuit against you. For example, if you are responsible for someone's injury resulting from a motor vehicle accident, liability protection provides you with legal defence in the event of legal action brought against you as well as pay for court judgements or settlements to your coverage limits.
Canadian laws require all automobile owners, who drive on public roads, to obtain certain basic coverages for their vehicle. In fact, proof of insurance is required when you are registering your vehicle.
In Canada, every licensed driver has access to auto insurance, regardless of their driving record. In some jurisdictions, special industry or government programs exist to ensure this availability. Compulsory minimum coverages and limits depend on where you reside.
Auto insurance coverages are packaged in a variety of ways. Some coverages are required by provincial laws; some are required by your lessor or financial institution and there are others that you may choose to protect yourself, those who drive your vehicle, and the vehicle itself.
- Third Party Liability protects you against claims should you be responsible for an accident that causes injury or death to another person or damage to a vehicle or other property.
- Direct Compensation-Property provides coverage for damage to your vehicle, its contents, and loss of use to the extent that you are not at-fault for the accident from your own insurer (only for those residing in Ontario and New Brunswick).
- Accident Benefits protects you, your family, and your passengers if you/they are injured in an automobile accident. Benefits are available regardless of who was at-fault and include medical and rehabilitation expenses and replacement for the loss of income if you/they are unable to work. (Optional for those residing in NL).
- Uninsured Automobile coverage protects you in case you or your passengers are injured by an unidentified or uninsured motorist. It may also cover damage to your vehicle where the uninsured motorist is identified. (In AB, similar coverage is offered under Uninsured Motorist Cover, part of Accident Benefits, but only extends to injury or death. No coverage is provided for damage to your vehicle).
Optional coverages (unless required by your lessor or financial institution):
All Perils, Collision, Comprehensive, or Specified Perils protect you against the cost of physical damage to your vehicle.
- All Perils combines all these coverages with a common deductible.
- Collision covers damage resulting from collision with another vehicle or object or overturn of the vehicle itself.
- Comprehensive covers all those damages caused by Specified Perils, plus such things as vandalism, windshield breakage, and animal collision.
- Specified Perils covers damage caused by fire, theft, explosion, hail, and other specified causes.
Recommended optional standard endorsement or change forms:
- Family Protection Form covers you if you are involved in a collision with an at-fault driver who does not have sufficient liability insurance to pay for your injuries and damages.
- Loss of Use (transportation replacement) Form provides you with a replacement vehicle or reimburses you for your transportation costs while your vehicle is inoperable after being damaged by an insured cause. It is subject to a daily and incident limit.
- Non-owned Automobile Form covers your legal liability for physical damage to a non-owned vehicle, including a rental, that you may drive. It extends physical coverage from your own vehicle to this other vehicle so you do not have to purchase this from a rental agency. It is subject to a maximum limit per vehicle.
Additional optional standard or change forms:
There are additional standard endorsement or change forms, prescribed by each province that further extend coverage. These include Drive Government Vehicles, Limited Glass, and others to meet your specific needs.