Mandatory car insurance in Ontario explained
Many drivers do not realize that auto insurance is mandatory in Ontario. It’s the law. So in order to drive in Caledon, you will need to purchase auto insurance coverage that complies with the province’s regulations. In Ontario, valid car insurance coverage looks like this:
- Third party liability coverage (a minimum of $200,000 of it)
- Accident benefits coverage
- Direct compensation - property damage coverage
- Uninsured motorist coverage
The four types of compulsory auto insurance coverage in Caledon
We want to provide a bit of context to the four types of auto insurance that are mandatory in Caledon, so we break down each compulsory coverage type below:
Third party liability coverage
Liability insurance is an important part of nearly any type of insurance, and that includes car insurance. In Caledon, drivers must purchase a minimum of $200,000 in third party liability coverage. With this type of insurance, your insurer will help pay for any car accidents that you cause. Specifically, third party liability insurance can reimburse policyholders for legal fees, medical expenses, and repair fees that are incurred.
Accident benefits coverage
Accident benefits coverage covers Caledon motorists who get into accidents that cause bodily harm to themselves or another. This mandatory coverage type will pay for the cost of medical attention immediately following or in the aftermath of the accident. Specifically, accident benefits can reimburse policyholders for medical expenses not covered by health insurance in Ontario, which may include prescription medication, rehabilitation, or physical therapy. Accident benefits may also pay for loss of income if you or someone else involved in the accident is temporarily unable to work due to the injury.
Direct compensation - property damage coverage
If your car is damaged in a collision that you did not cause, you can claim direct compensation - property damage (DCPD) coverage. This type of compulsory coverage in Caledon is one of the simplest forms, and if you qualify, you can receive a payout directly from your insurance company to cover the cost of repairing your car.
Uninsured motorist coverage
Uninsured motorist coverage covers Caledon drivers who get into car accidents with other drivers who are either uninsured, underinsured, or unidentified. We explain what each of these drivers looks like below:
- An uninsured motorist: a motorist who failed to purchase an auto insurance policy and is therefore driving illegally in Ontario.
- An underinsured motorist: a motorist who does not have enough car insurance coverage to pay for the cost of the accident.
- An unidentified motorist: a motorist who is unknown or anonymous because they illegally fled the scene of the accident, unidentified motorists are most common in hit and run situations.
Add extra car insurance protection in Caledon for peace of mind
While the four types of coverage listed above are mandatory, they will not be enough for all drivers in Caledon. That is why so many motorists opt to add extra car insurance protection to their policies in the form of collision coverage, comprehensive coverage, accident forgiveness coverage, and the like. Optional coverage comes in many forms and different insurers offer different types of coverage. That said, there are many optional coverages that drivers find to be incredibly worthwhile. For greater peace of mind while on the road, consider adding one of the following coverage types to your Caledon auto insurance policy:
Think of collision car coverage as a more comprehensive version of direct compensation - property damage coverage. As with direct compensation - property damage coverage, collision coverage specifically deals with damage to your vehicle following a car accident. However, collision coverage can be claimed whether you were at fault for the accident or not. It can also be claimed whether the damage was caused by a run-in with another vehicle, animal, or grounded object. Although collision coverage will be optional for most Caledon drivers, if you lease or finance your car, it could be required so read the terms and conditions of your contract carefully.
Comprehensive car coverage is one of the most popular types of optional car insurance coverage for a reason. Caledon drivers choose it for the peace of mind it offers. With comprehensive car coverage, your insurance company will reimburse you if your car is damaged from circumstances unrelated to a collision. For instance, if a tree branch falls on your car while parked or a burglar steals it in the middle of the night, comprehensive coverage will pay for the cost of repairing or replacing it. Perils that your insurance company may offer protection against include fire, vandalism, theft, water damage, wind, falling objects, and more.
Accident forgiveness coverage
One more type of optional car insurance coverage popular among drivers in Caledon is accident forgiveness. Accident forgiveness is additional 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 and eligibility varies by province.
Loss of use coverage
Finally, loss of use coverage can cover the costs that arise when your vehicle is rendered temporarily unusable due to damage. For example, if your car is majorly dented in a car accident and needs to go to a repair shop, loss of use coverage can compensate you for any transportation expenses incurred while you couldn’t use your vehicle to get around. These expenses could include public transportation costs, the cost of hailing a taxi or rideshare, or even the cost of renting a car. Ultimately, loss of use coverage can be a beneficial type of insurance to have in your back pocket, especially if you do not have easy access to a second car and rely on your vehicle to get around.
Factors influencing the cost of car insurance in Caledon
The cost of car insurance in Caledon differs between drivers. Why? Each driver has their own unique set of circumstances. While you may have your location in common, where you live is just one factor of many that an insurance company will use to calculate your premium. Thus, just because your neighbour pays a certain rate for car insurance in Caledon does not mean you will pay the same. For a complete list of factors that can influence auto insurance costs in Caledon, keep reading:
- Where you live (and where you regularly commute)
- Model, make, and year of vehicle
- Past claims
- Average mileage
- Driving experience
- Driving record
- Insurance history
- Deductible amount
- Regulatory bodies
- How you use your vehicle
It is worth reminding you that insurance brokerages like BrokerLink don’t set rates. Rather, insurance rates are calculated and ultimately determined by insurance companies. However, a licensed insurance broker at BrokerLink can certainly help you compare policies, obtain quotes from other insurance providers, and give you advice on how you can lower your Caledon auto insurance premium.
Get an auto insurance quote [phone]
Tips to find auto insurance in Caledon on any budget
BrokerLink believes that car insurance should be affordable for all, especially given that it’s mandatory in Ontario. For this reason, we aim to help customers from across the province find coverage on any budget, and we do this by providing them with all kinds of money-saving strategies and advice. Continue reading to discover some of BrokerLink’s top tips for finding cheap auto insurance in Caledon, Ontario:
- Choose a yearly payment schedule for your Caledon auto insurance policy and always pay by the deadline.
- Only purchase insurance coverage that serves you; purchasing additional coverage you don’t need will drive your rates up .
- Assess your financial situation to determine the highest possible deductible amount you could reasonably afford to pay if you needed to file a car insurance claim.
- Learn safe driving tips by enrolling in a driver’s education course.
- Lower your average mileage by walking, cycling, carpooling, or taking public transit instead of driving everywhere .
- Qualify for a winter tire discount by installing winter tires on your car.
- Drive safely to keep your record clear of infractions.
- Install an anti-theft device somewhere in your car to make it less of a target for thieves.
- If you’re buying a new car, consider a hybrid or electric car if you want to save on auto insurance.
- Ask a BrokerLink insurance advisor to research the different types of car insurance discounts that you may qualify for, like occasional driver, telematics, winter tire, or employer discounts.
- Combine two or more products into one by buying multiple auto insurance policies or bundling insurance policies.
- Research safety and theft ratings before buying a new car and choose one with a high safety rating and a low rate of theft.
- Weigh your options by shopping around and comparing policies before buying one.
- Seek help from a licensed insurance broker with years of experience helping customers like you find car insurance coverage.
We’re in your community
BrokerLink puts the customer’s needs above all else. We are a customer-driven brokerage, which means we are focused on providing a top-tier customer service experience, both within and outside of the insurance world. BrokerLink constantly strives to provide dynamic insurance solutions while also giving back to the local communities we serve. Learn more about how we aim to make Caledon a better place by getting in touch with us today.
Local Ontario Insurance Links
If you’re a member of a group or association, you may be eligible for more discounts.
At Caledon BrokerLink, we’re here to help you with any insurance needs you may have. Whether it’s insuring your home, car, business, recreational items, or pets, let us help you find the best coverage possible.
You can reach us by phone, email, or in person at any one of our locations throughout Ontario. No matter how you choose to get in touch, a BrokerLink insurance advisor will be happy to assist you. We also encourage you to take advantage of our free online quote tool that can provide you with a competitive quote in minutes.
Get an auto insurance quote [phone]
FAQs about auto insurance in Caledon, Ontario
Should I renew my auto insurance policy in Caledon?
The decision of whether to renew car insurance in Caledon is up to you. If you plan to continue driving, you will need to have a valid car insurance policy. However, you may wish to purchase a new policy rather than renewing your existing one. To make this decision, consider your budget, experience with your current provider, and your coverage needs. From there, shop around and see what else is out there. If you find a policy that’s a better fit, let your policy expire at the end of the term and buy a different one. If you decide that your current provider is still the best fit for you, then contact them ahead of the policy expiry date and let them know that you want to renew your coverage. If your policy has expired, you may still be able to renew your policy, though the expired car insurance renewal process may be lengthier.
How long do car accidents stay on driving records in Caledon?
Car accidents tend to stay on Ontario driving records for a period of six years. This means that if you get into an at-fault accident, it may remain on your record and impact your insurance premium for a period of six years. The good news is that accidents you are involved in but did not cause will likely not affect your premium. Further, if you have accident forgiveness coverage and you get into an at-fault accident, so long as it was your first, your rates won’t change either.
Do I need an Ontario driver’s licence to buy Caledon car insurance?
Yes. A driver’s licence is mandatory if you want to buy car insurance in Caledon.
I’m moving to another province. Can I still use my Caledon car insurance plan?
No. If you are planning a permanent move to another province, you will need to notify your insurance provider and update your policy. Even if your current provider offers coverage in the province you are moving to, you will need to update your address and likely your coverage to ensure it complies with your new province’s minimum coverage requirements. You should be prepared for your premium to change as location is a major factor in determining auto insurance rates.
If I am caught driving without car insurance in Caledon, what could happen?
The penalties for driving without car insurance anywhere in Ontario are as follows:
- Maximum fines of between $25,000 and $50,000
- A 25% surcharge on any fines incurred
- The impoundment of your vehicle
- The suspension of your driver’s licence for a period of 30 to 365 days
Ultimately, the penalties you will face for getting caught driving without insurance will depend on the person who pulls you over. However, given how severe they are in Ontario, abiding by the law and purchasing an auto insurance policy is the smartest choice you could make.
How much does Caledon car insurance cost?
How much is car insurance per month in Ontario? The average monthly cost of Ontario auto insurance is $150 to $450. However, this is the provincial average, not the average in Caledon specifically. Plus, insurance rates vary drastically, so you could easily end up paying far below or above the average depending on your circumstances. Thus, to find out how much Caledon car insurance will cost for a specific individual, it is recommended that you reach out to a licensed insurance agent or broker near you and request a free auto insurance quote.
Do I need third party liability coverage before getting behind the wheel in Caledon?
Yes. You will need to buy a car insurance policy that features third party liability insurance before getting behind the wheel in Caledon. It’s the law. All Ontario drivers must have an auto insurance policy that contains four types of coverage: liability coverage, uninsured motorist coverage, accident benefits coverage, and direct compensation - property damage coverage. For liability coverage in particular, you must choose a coverage limit that is at or above $200,000.
Do credit scores impact car insurance rates in Caledon?
They can, but they will never be the only factor that an insurance company will consider. If an insurance agent asks about your credit score, they are likely doing so to gauge your financial responsibility. Credit scores can be an indication of how responsible you are, with higher credit scores indicating more responsibility and lower credit scores indicating less responsibility. Thus, if you have a high credit score, this could benefit you as your insurer may lower your rates accordingly. However, even if you don’t have the best credit score, there are so many other factors that an insurance company will consider when setting your premium in Caledon. For example, your age, driving record, location, and the deductible amounts you select for your policy are far more likely to influence your Caledon insurance premium than your credit score.
If you have any questions, contact one of our local branches.
More Ways to find a great car insurance rate in Ontario