Dave Lympany: Auto Insurance
Auto insurance in Canada is as essential as most other countries around the world. The main difference is that each Province has its own rules and regulations regarding the minimum level of cover and also who can supply the insurance cover. Without a doubt it is imperative that wherever you reside in Canada you do have the minimum level of cover required by Provincial Law, you were truthful when you applied for the coverage and that you are able to produce the correct documentation (the “pink card” which is your proof of insurance anywhere in Canada) if requested by the police.
The minimum level of Auto Insurance and who provides it differs around the various Provinces with British Columbia, Manitoba and Saskatchewan Government Insurance agencies being the authorized vendor. You will purchase the minimum level of cover when you register your vehicle each year. This applies to the minimum coverage with both the Government and Private companies offering additional coverage that effectively boosts the level of protection. The Province of Quebec has a slightly different system with any vehicular or property damage being covered by private companies and the injury coverage being provided by the Provincial Government. These provinces may not give out the Pink card as the vehicle registration is proof of insurance.
The remaining Provinces all have private insurance companies giving the Auto Insurance coverage with Alberta in particular recently having a Provincial Government led revamp of their system. This led to a reduction in the maximum level of compensation paid out to minor injuries in a bid to reduce spiraling premiums.
In Canada, every vehicle driver who is correctly licensed has access to the basic auto insurance required by Law. However, your driving history will have a direct impact on the amount you will pay for this insurance along with several other factors:
1. The make and year of vehicle you drive (for comprehensive policies)
2. The location of the vehicle (“bad area’s with high crime have higher premiums)
3. Business use
4. Insurance claim record (more claims higher cost)
5. Number and age of other drivers who are entitled to use your vehicle and their driving records.
The Canadian Council of Insurance Regulators is a country wide body that’s mission is to “promote an efficient and effective regulatory system in Canada to protect the public interest”. Each Province in turn has its own insurance regulatory body to ensure that standards are introduced and then subsequently followed – these regulators cover most types of insurance and not just the Auto Insurance.
If you are inadequately or incorrectly covered the consequences may be severe. The legal action will undoubtedly involve demerit points on your license and also a hefty fine. This in turn will increase your future insurance premiums quite substantially. The other side of it is that should you be involved in an accident where you are at fault your insurance will be invalid. Then you are liable for all the costs associated with the accident (yours and other vehicle repairs/replacement, damaged property, emergency service costs, clean up costs. This may seem a lot of money, which it is, but this will pale into insignificance should anyone be injured seriously or killed and will most likely end up in bankruptcy.
Another good tip is to use a quality Auto Insurance company, not always the cheapest, but I know from experience that if you are injured in an accident you have better things to concern you than being messed around by a substandard insurance company. The Physiotherapist treating my minor injuries had extensive experience of clients who had injuries being treated that were fighting every step of the way to have the treatment paid for when it was clearly covered in the policy.
In the event of an accident or claim against your policy it is imperative you contact your insurance agent as soon as is practically possible. If injuries have been inflicted, unlawful damage or theft taken place or the amount of damage will be beyond the limit stated for each Province then the Police must also be contacted within a prescribed time limit. Contacting the Police and the agent will ensure that correct procedures are followed, you do not negate the policy or incur additional Police Charges (depending upon circumstances).