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Average Monthly Car Insurance Rates in Ontario

Published on Feb 18, 2019 | Last updated Nov 24, 2020 4 minute read

Average Monthly Car Insurance Rates in Ontario

The average monthly car insurance rates in Ontario are between $125 to $158, depending on which part of the province you live in. This is the highest average car insurance rate among all provinces in Canada. However, monthly averages can be a deceptive number because rates can vary significantly from city to city, and from driver to driver. To complicate the situation even further, there are a variety of factors used to determine a driver’s individual automobile policy. Policies are based on individual characteristics of the driver, vehicle, reason for driving, personal data and more. Insurance providers may use standardized formulas for determining a driver’s premium rates, but they can also use methods that are internal to the specific company. All of these items affect the average monthly cost of your auto insurance.

How high are car insurance rates in Ontario?

The average monthly car insurance rate in Ontario will change will obviously change every year. Insurance companies can submit rate changes for approval once per quarter (or every three months), which means the average prices will also change. In Ontario, it has become very rare in recent years to have a quarter when rates decrease at all. These frequent changes in rates over time can make it difficult to declare a single fixed monthly average car insurance rate for any province.

To simplify this situation, consider the highest, lowest and middle rate amounts for recent periods. This gives a good range for consumers who really want to know what to expect from average monthly prices for car insurance in Ontario. Low estimates put the average rate at around $1,500 per year, and the high estimate is around $1,900 per year. These estimates can be used as a general range to get a more accurate monthly average.

On the high end of this spectrum, the average car insurance Ontario policy costs around $1,900 per year. This works out to around $158 per month.

The next thing to consider is how these rates are actually calculated so that drivers like yourself can figure out if there is any viable way to lower the monthly cost of your car insurance.

How are premiums calculated?

Basic information like location, driving experience, gender and age are always used to calculate car insurance rates in Ontario. According to a manager at the Insurance Bureau of Canada, this actuarial method derives risk from historical data and statistics. This provides a guideline that aims to charge more premium for more high-risk drivers.

In Ontario, we have a private car insurance system, which means drivers are free to shop around for car insurance rates from multiple companies. In some other provinces, like British Columbia, a public insurance system used and all drivers are insured by the governing body, ICBC.

There have been many debates over which system is truly better for drivers, and each does have it’s benefits and drawbacks.

When providing a quote, insurance companies request information from the driver that enables them to determine rates. This includes all of the driver’s personal information including address, date of birth, gender, vehicle make and model, and more. The driving record and the total number of years driving will also play a central role in determining the cost of any insurance policy. Insurers also look at the total number of kilometres expected per year as well as the reason for driving.

What other factors affect premium costs?

There are many factors that affect premium cost. As mentioned, the make and model of the vehicle will play a major role. Every vehicle has a unique rating based on safety, theft rate, cost to repair, and other claim history data. A vehicle rating can make a significant difference in your car insurance premium, so ask your insurance broker about the car you intend to purchase before closing the deal.

Some aspects of the driver’s risk level are unchangeable. Age, gender and location of residence play a major role in the cost, but there is nothing the driver can do to change these items. However, the most important rating criteria for determining your car insurance rate is within your control; your driving record.

Avoiding tickets, accidents, and other car insurance claims will help you build a stellar driving record, and over time, will allow you to find the cheapest car insurance rates available.

What makes car insurance more expensive?

Ontario drivers face high insurance rates mainly due to the province where they live and drive. The average cost per claim in Ontario is higher than any other province. In addition, an increase in claim fraud has also been impacting the average cost of an insurance claim. And when claim costs increase, so do average car insurance rates.

What makes car insurance cheaper in Ontario?

Although Ontario is the most expensive place to drive in Canada, you can still take steps that will reduce your car insurance costs. Keeping a spotless driving record over time is the best way to reduce rates. Make sure to research the type of car you plan to purchase, and ask your insurance broker what your premium would be for each vehicle.

Consider increasing the deductibles on your car insurance policy. You can get a better rate if you are able to pay a higher deductible amount in the event of an incident.

Put your policies with the same provider. Combining home and auto policies can also reduce the total amount by adding valuable multi-policy discounts. Make sure that every person added to the policy has a clean driving record.

Select the amount of coverage that fits your budget. “Full coverage” will obviously cost more than “liability only”. Furthermore, policies with two million in liability will cost more than policies with one million in liability coverage.

Finally, you should always ask for discounts from your insurance agent. There are discounts available for students, winter tires, monitoring devices, car alarms, multiple vehicles, retired drivers and more. Make every premium payment on time, and maintain continuous coverage.

Reduce your average monthly car insurance rate on your Ontario auto insurance policy by applying these ideas into action today.

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