How do insurance companies determine fault?

12 minute read Published on Oct 20, 2023 by BrokerLink Communications

Two Drivers Arguing After Traffic Accident. 2 Crashed Cars Appearing in Background.

As a driver in Canada, avoiding common car accidents is of the utmost importance. However, if you do find yourself in an accident, you may be wondering how your car insurance covers you. The truth is that your coverage depends on the circumstances of the accident - namely, who was at fault for the accident. But how is fault determined and who determines it? That’s the topic we’re diving into today.

Insurance companies and fault in car accidents

After being involved in an accident and calling your insurance company after a minor car accident, the next step is to determine fault. Determining fault is not up to one party. Instead, it is up to multiple parties ranging from the law enforcement officers who arrived on the scene and wrote the police report to the insurance adjuster that your insurance company assigned to the case. Sometimes, attorneys, a jury, or the drivers involved in the accident may also determine fault. However, generally speaking, insurance companies have an adjuster review the circumstances of the accident, along with the police report, to determine which party was at fault.

It is worth noting that shared fault is possible in Canada. That said, one party will always generally be found to be more at fault than the other.

The importance of determining fault following a collision

The truth is that one of the most important parts of the insurance claims process for car insurance is determining fault in an accident. Why does it matter? Due to the fact that the person who is deemed at fault for the car accident will be the one who is responsible for the cost of any bodily harm or property damage incurred.

For example, in Ontario, when a driver is determined to be at fault for an accident that resulted in bodily injury, that driver’s third-party liability insurance will kick in and help cover the cost of any medical expenses incurred by the injured party, as well as the legal fees to fight the personal injury claim made against them. As you can imagine, third-party liability insurance is one of the most important types of auto insurance in Canada. For this reason, it is also a legal requirement in every Canadian province and territory.

Ontario’s no-fault insurance system

Since we’re discussing the topic of at-fault and no-fault car accidents, let’s take a moment to discuss no-fault insurance in Ontario. No-fault insurance is a system in which all insurance claims are handled by the policyholder’s own insurance provider rather than by the court system or another driver’s insurance provider. Thus, despite the name, no-fault insurance in Ontario does not relate to fault determination after an accident. Fault will still need to be determined following a collision, and the province has strict rules that insurance companies must follow. These are known as the fault determination rules, and through these rules, each person involved in the collision will be assigned a share of the fault as a percentage.

As mentioned above, shared fault is possible in Ontario. Let’s look at an example. If you got into an accident with one other driver, your insurance company will need to determine who was more at fault - you or the other driver. A driver is deemed at fault for a car accident if they are found to be over 50% liable for the accident.

Who is responsible for determining fault in Ontario? This ranges from the police to insurance adjusters to the legal system. However, generally speaking, insurance companies and insurance adjusters typically have the most power when it comes to determining and assigning fault.

Which parties are responsible for determining fault after a car accident?

Now that you have a better understanding of why fault is determined in Ontario and how the province’s no-fault insurance system works, let’s get into the nitty gritty of who is responsible for determining fault after an accident.

As mentioned above, insurance companies and the insurance adjusters they hire to investigate the claim typically have the most influence when it comes to determining fault. That said, they are not the only party involved in the fault determination process. The drivers and passengers involved in the accident, as well as the police, attorneys, the courts, and more, may all have a role in determining fault.

Keep reading for a breakdown of the parties that may be responsible for determining fault after a car accident:

Drivers and passengers

Following a collision, it is possible for the drivers and passengers involved to discuss fault amongst themselves. In some cases that are more clear-cut, this can be worthwhile. However, generally, experts do not recommend that drivers discuss the collision, especially who was at fault for the collision, with anyone other than the police. It can be useful to listen to what others are saying, though.

For instance, in the heat of the moment, you might hear the other driver admit to looking down at this phone and missing the light change from yellow to red. This would be good information to have when you do eventually talk to the police and file a claim with your insurance provider.

Law enforcement officers

Another party who may have a say in determining fault after a car accident is the law enforcement officer who arrived on the scene. When you get into a car accident, most drivers report the car accident to the police. In fact, they may not have a choice, as not reporting a car accident may be illegal in certain situations, such as if someone was injured in the accident. Regardless of whether you have to report the accident or not, once you do so, a law enforcement officer will arrive on the scene.

They will speak with those involved in the accident, as well as any eyewitnesses, if applicable, and gather evidence about the collision. This evidence may include notes about the weather and road conditions at the time of the accident, as well as photos and videos of the scene of the accident. This will all eventually make its way into the official police report. The police report will include all sorts of pertinent information that can be used to determine fault.

For example, the report will state if one driver ran a red light, was speeding at the time of the collision, or was engaging in distracted, careless, or impaired driving. The report will also include basic information like the names, driver’s licence numbers, licence plate numbers, and vehicle identification numbers of all drivers and cars involved in the accident.

Insurance companies and insurance adjusters

Insurance companies have a lot of power in determining fault. More specifically, the insurance adjuster that an insurance company assigns to investigate a claim will have a significant say in determining fault. Insurance companies put insurance adjusters on the case because they are required to in Ontario. According to Ontario’s Fault Determination Rules, all insurance companies are legally required to investigate all insurance claims and assign fault accordingly. As such, insurance companies usually use an insurance adjuster, either an in-house one or one they hire through a third party. The adjuster’s job is to evaluate the details of the accident and assign fault based on the evidence provided to them.

Examples of factors that they will examine include the speeds at which both cars were travelling at the time of the accident, whether either driver was engaged in distracted or reckless driving behaviour, as well as the weather and road conditions at the time of the accident. Typically, an insurance adjuster will find evidence in the police report drafted by the law enforcement officer who arrived at the scene of the accident, as well as the claims forms submitted by the policyholder. Most insurance claims forms usually include lots of information about the accident, including photo and video footage taken by the policyholder.

Please note that if two drivers were involved in the accident, the insurance companies for both parties are required to investigate the claim. The findings of both insurance companies will be considered when fault is officially assigned.


An attorney may have a say in determining fault, but only if one of the parties involved in the accident chooses to hire one. This is not very common in Ontario. In fact, one of the parties involved will usually only hire an attorney if they do not agree with the conclusion that the insurance companies came to. If an attorney becomes involved in the determination process, they can argue that their client should be assigned less fault, providing various reasons for this.

The courts

If the insurance claim ends up going to court, then a jury may have the final say in determining fault. Please note that a car insurance claim going to court is extremely rare in Canada, especially since Ontario’s no-fault insurance system was introduced.

Evidence that may be used to determine fault after a car accident

You might be surprised to learn just how many types of evidence an insurance company will use to determine fault after a car accident. Generally, it is recommended that all parties involved gather as much evidence as possible, ranging from photos and videos to personal notes, witness statements, and more. Below is a list of the various types of evidence that may be used to assign fault after an accident:

  • The police report
  • Eyewitness statements
  • Photos of the accident
  • Video footage, including personal footage taken on a smartphone, surveillance camera footage, store security camera footage, dashcam footage, and traffic camera footage
  • Black box collision data from the cars involved
  • Verbal or written statements from all drivers involved in the accident
  • Medical records of those involved in the accident

What to do after getting into a car accident

After getting into a car accident, you will probably be a bit overwhelmed. This is completely normal. But knowing what to do after getting in a collision can help guide you through the process. Keep reading to learn how to handle a car collision:

Call 9-1-1

First, call 9-1-1. If anyone is injured, this is a must, even if all you see is a minor injury. If you aren’t yet sure if you or another person involved in the accident is injured, it’s still best to call 9-1-1, especially if there is significant damage to one or both vehicles. Please note that accident benefits coverage may cover you for the cost of medical expenses not covered by your health insurance policy. By doing this, the police will be dispatched to the scene along with emergency medical services and you will be able to get the police report number for your insurance company.

Gather evidence of the scene

If you are able, take some time to gather evidence of the scene before emergency services arrive. This may include taking photos and videos of the damage done or the road conditions at the time of the accident. It may also include asking witnesses for statements. Now is also a great time to exchange insurance and vehicle information with the other person or people involved in the accident.

Do not admit fault

If you end up speaking with the other driver(s) involved in the accident, do your best not to admit fault. Listen to what they are saying and take notes, but do not offer up much more than your contact information, as well as your insurance and vehicle information.

Avoid confrontation

There’s no denying that things can get heated following a car accident, but you should always do your best to remain calm and avoid an angry confrontation with another driver. Keep all communication civil.

Call the police if you haven’t already

If you didn’t call 9-1-1 due to the fact that no one was injured in the accident, now is the time to call the police. When you call the police, a law enforcement officer will be sent to evaluate the scene and draft a police report. There are many circumstances in which you are required to notify the police after an accident. These vary from province to province, but in Ontario, you are required to do so if any party is injured, if you suspect someone of doing something illegal, like impaired driving, or if the damages to the cars involved exceed $2,000.

Notify your insurance company

The final step after getting into a car accident is to notify your insurance company. An insurance agent will be able to explain the claims process to you, as well as offer insight into which type of coverage will protect you given the circumstances of the accident. They will be able to communicate the information to your insurance company on all the details of your incident. For example, if you got into a serious accident with another car, animal, or grounded objects on the road, you might file a claim under the collision car insurance portion of your policy. In addition, your insurance company can inform you of how this accident could impact your rates. Note that if your policy features accident forgiveness coverage and this is your first at-fault accident, your rates may remain the same.

What types of compensation can I receive after a car accident?

After getting into a car accident in Canada, there are several types of compensation that you may receive from your insurance company - assuming you were not deemed at fault for the accident. How big of a payout you will be issued depends on several circumstances. We explain the three main ways that victims of collisions are compensated below:

Accident benefits

Accident benefits can compensate the policyholder or others involved in the collision if they are injured or die. Specifically, it can reimburse them for costs like funeral fees, lost income, physical therapy, rehabilitation, prescription medications, etc.

Direct compensation - property damage

Direct compensation - property damage coverage pays to replace or repair the policyholder’s damaged vehicle in a car accident, so long as they did not cause the accident.

Third party liability

Third party liability insurance may compensate a victim for the cost of property repair bills or medical bills following the collision. How third party liability coverage works is that the victim will receive this compensation through the at-fault party’s coverage. It’s also worth noting that the compensation you receive will be proportional to how at fault you are found to be.

Tips to lower your car insurance premium after a collision

If you get into a collision, then you might be worried about how it will impact your insurance rates. The reality is that having an accident on your record can lead to an insurance premium increase. Thankfully, there are several ways that you can save on car insurance, and they are outlined below:

Sign up for a driving program

One way that you can reduce your premium even after it goes up following a collision is to sign up for a driving program. A defensive driving program that is recognized in your province will teach you safe driving tips that will mould you into a safe and responsible driver who is less likely to get into an accident in the future. As such, your insurance company is likely to give you a car insurance discount if you can provide proof that you enrolled in and graduated from a driving course. Generally speaking, the safer you drive and the cleaner your driving record is, the cheaper your rates will be. Insurance companies like to reward drivers who obey the rules of the road and avoid tickets, accidents, and other infractions.

Purchase an accident forgiveness endorsement

A second tip to lower your car insurance premium after a collision is to buy an accident forgiveness endorsement, this endorsement has to be purchased prior to the accident, it can not be purchased after an accident. By adding an accident forgiveness rider or endorsement to your car insurance plan, your insurance company won’t be able to increase your rates after your next at-fault accident. Accident forgiveness is a type of optional coverage that can be added to your car insurance policy as an endorsement, to protect your driving record and to help prevent your insurance premium from increasing if you have an at-fault accident claim. Note: coverage varies by province.

Reach out to BrokerLink for more information on how insurance providers assign fault after car accidents

If you want to know more about the fault determination process in Canada, including who is responsible for determining fault, how shared fault works, or what types of evidence are used to assign fault, contact BrokerLink. We are car insurance experts, and although we as insurance brokers are not responsible for determining fault, we have a deep understanding of how insurance companies navigate this process. So if you find yourself in a car accident, don’t hesitate to get in touch. One of our licensed insurance advisors can explain how fault will be determined and even offer advice on the claims process.

Of course, as a full-service insurance brokerage, we can also help you find a great car insurance policy that features everything from mandatory coverage like uninsured motorist insurance to extra protection like comprehensive car coverage. Even better, we can help you find coverage at an affordable rate. Get started by requesting a free car insurance quote now.

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