Planning a move to Canada and wondering about your driving status? BrokerLink is here to help. Below, we dive into how car insurance works for non-Canadian residents, explaining whether non-residents can purchase auto insurance and what coverage they need.
Can non-residents drive in Canada?
Temporary residents are entitled to drive in Canada, however, they will need valid driver’s licences to do so. This driver’s licence does not need to be a Canadian one, rather, it can be a valid licence from another country. Non-residents can use foreign driver’s licences while they drive for a limited time.
This time frame varies by province and typically lasts between three and six months. After this period is up, the non-resident must obtain a Canadian driver’s licence if they wish to continue driving. To do this, they must pass the mandatory knowledge and road tests in their province. Another option is to obtain an international driving permit (IDP) from your home country that has been translated into one of Canada’s official languages (English or French).
Is auto insurance mandatory for non-Canadian residents?
Yes, car insurance is mandatory for all drivers in Canada, including temporary residents, permanent residents, and citizens. In order to register your vehicle, you must purchase a car insurance policy that complies with local laws in your jurisdiction.
Each Canadian province and territory has its own minimum coverage requirements. For example, in Ontario, your car insurance policy will only be valid if it includes uninsured automobile coverage, direct compensation - property damage coverage, accident benefits coverage, and no less than $200,000 in third party liability coverage.
What information is required for non-residents to purchase a car insurance policy in Canada?
Before you start shopping for car insurance, make sure you have the following documents and information prepared:
- Your Canadian driver’s license.
- Your complete home address, legal name, and driving record.
- Information about your vehicle, including its model, make, age, registration number, and mileage.
- Your past and current insurance history.
- An official letter to prove your insurance claims history.
Can non-Canadian residents get auto insurance?
Yes, it is possible for temporary residents to obtain car insurance. However, it can be a little more difficult (and is often more expensive). Many insurance companies are wary of international licence holders, which could lead them to deny coverage or charge higher rates.
However, working with an insurance broker can make finding car insurance with a foreign driver’s licence a much simpler process. A reputable brokerage like BrokerLink will know which insurance companies offer policies to international licence holders and can help you compare quotes to find the best coverage at the most affordable rate.
Some companies even offer short-term car insurance options for residents who are only in the country for a short period of time (e.g. six-month insurance terms rather than an annual term).
Can non-residents import cars into Canada?
Non-residents are legally allowed to import vehicles into Canada, however, the process can be complicated and there are many restrictions. First, the vehicle in question must comply with the Canadian Motor Vehicle Safety Standards (CMVSS). These standards pertain to all types of vehicles, from passenger cars to motorcycles and snowmobiles. The car must also meet all border entry regulations as per the Canada Border Services Agency (CBSA).
If you are able to successfully import your vehicle into Canada, make sure to keep track of all import paperwork. Please note that importing a vehicle into Canada doesn’t mean that it is automatically registered or that you are guaranteed insurance.
Each province and territory has its own rules surrounding the types of vehicles that can be registered (e.g. some may not allow you to register right-hand drive-styled cars or salvage vehicles). Ultimately, before going through the trouble (and cost) of importing a car from another country, contact a local authority in your province to determine if your vehicle is likely to be approved for entry, registration, and insurance.
Vehicles less likely to gain entry into Canada
Vehicles with modifications often do not meet the standards set out by the CMVSS or the entry requirements set by the CBSA. While some vehicles may qualify for exemptions, the following are examples of vehicles unlikely to be approved for entry into Canada by non-residents:
- A motorcycle that has been modified into a trike.
- A cargo van that has been modified into a camper van.
- When a lift kit has been added to the suspension of the vehicle.
- When a vehicle has been modified to make it accessible for the disabled.
- When the length of the vehicle has been increased.
- If the vehicle has been fit with a different body kit.
Mandatory car insurance coverage for non-Canadian residents
Since car insurance is mandatory throughout Canada, all temporary residents will need to obtain insurance in order to get behind the wheel. Coverage requirements vary by province. Check out the mandatory coverages in Ontario as an example:
Third party liability coverage
Third party liability coverage provides legal protection if you injure someone else or cause property damage to another person’s property on the road. This type of coverage can help pay for medical expenses associated with bodily injuries or repairs of damaged cars, as well as any applicable legal fees and settlements up to the coverage limit. In Ontario, drivers are required to hold a minimum of $200,000 in third party liability coverage at all times.
Direct compensation - property damage coverage
Direct compensation - property damage coverage protects an insured vehicle and its contents against property damage, so long as the policyholder is not at fault for the collision that caused said damage. Under this type of coverage, the insurance provider typically pays for the repair or replacement of your car directly.
Note that to be eligible for direct compensation coverage, the collision must meet the following circumstances: it occurred in Ontario, it involved more than one vehicle, and it involved at least one vehicle that participates in the province’s car insurance program.
Uninsured automobile coverage
Uninsured automobile coverage is designed to protect you and any passengers in your vehicle if you get into a collision with an at-fault driver who is either uninsured or underinsured. This type of coverage can also protect the policyholder in the event of a hit-and-run.
Accident benefits coverage
If you, a passenger, or a pedestrian requires medical attention following a collision, accident benefits coverage can help. This type of coverage is provided no matter who was at fault for the accident and it can help cover a wide range of medical expenses like prescription medications, physical therapy, or rehabilitation, as well as loss of income.
Contact BrokerLink to learn more about car insurance coverage for non-Canadian residents
Did you recently move to Canada and are looking for car insurance? Get in touch with one of BrokerLink’s expert insurance advisors who will be pleased to assist you. With decades of experience in the insurance industry, we know which insurance companies to contact about auto insurance for non-Canadian residents. Plus, we make shopping for car insurance easy by obtaining and comparing quotes on your behalf. When you work with BrokerLink, we will be by your side every step of the way.
You can reach us by phone, email, or in person at one of our many locations across Canada. You can also take advantage of our online quote tool and request a free car insurance quote now.
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