Buying Car Insurance
We get asked this question a lot but there’s no easy answer. Every insurer has their own formula for calculating premiums, and the company willing to offer the cheapest insurance to you, will not be the same for everyone. If you asked five insurance companies for a quote, you would receive five different answers, and the difference between the highest and lowest can amount to hundreds and sometimes thousands of dollars per year.
For this reason, comparing rates is the best way to save money on auto insurance. Compare coverages to ensure they provide the protection you need, select the lowest price and voila, you have found the cheapest car insurance!
Car insurance premiums are determined by multiple factors. Some of them, like your age or the city in which you live, are out of your control, but there are other ways to keep the cost down. Follow these tips to give yourself the best chance of finding cheap car insurance:
Aggregator sites like this one make it easy. Answer a few questions about your vehicle and your driving history and you’ll get a list of the cheapest rates. Not only can you see multiple insurance quotes and coverages in one place, but also some of the cheapest insurance companies only offer online policies. This means we might have access to rates that a traditional, offline broker does not. Companies that operate exclusively online are typically cheaper, because they have fewer overhead costs and these savings are passed onto customers.
As silly as it seems, asking for a discount often works! While car insurance premiums are not negotiable, hidden savings are sometimes available if you are a member of an auto club (like the CAA), a unionised worker, a retiree, or a university alumnus, for example. Ask about discounts for specific memberships and see if any apply to you.
In some provinces, insurance companies may ask permission to check your credit score when determining your level of risk. Ensure good credit by paying your bills on time, and try to resolve any delinquent accounts before requesting a car insurance quote. The better your credit, the cheaper your insurance premium will be.
A clean driving record is the best way to get cheap insurance. Your driving history is a good indication of your driving future, so a driver with a long, clean record will have insurers competing to get his or her business. A poor driving record is not desirable from an insurance perspective, as the chance of you getting into an accident and making a claim is higher. Dangerous drivers face the highest premiums and the least amount of choice when it comes to picking a provider.
Most Canadian insurance companies offer a discount if you allow them to monitor your driving habits. This is normally done by installing an app on your phone. While it may seem intrusive, the data they gather cannot legally be used to increase your premium.
The more time you spend on the road, the higher the likelihood of getting into an accident. Therefore, when an insurance company asks for your annual mileage, a lower number is better. Reduce your driving time by cycling, walking or taking public transport. Not only are you helping the environment, but it is kinder on your wallet too.
Regardless of how good your driving is, some cars just cost more to insure. The age, make, model, safety rating and cost of your vehicle will affect your insurance rate. The cheapest cars to insure are often four door sedans or mid-tier SUVs, especially those for which replacement parts are easy to source.
By agreeing to a higher deductible, insurance companies will reward you with a lower premium. Just make sure you can afford this expense in the event of an accident.
If you have other insurance needs, in addition to auto, you may save money if you use the same insurance company for all of them. Bundling your home and car insurance together, for example, reduces the premium for both.
Everyone likes to save money, but when it comes to insurance, cheaper doesn’t always mean better. Before deciding on an insurance company, make sure you understand the coverage they are offering. Some companies remove or reduce common coverages to offer competitive pricing. This might be fine depending on your insurance needs, but read the policy options before you buy anything.
Comparison tools are a great way to find a low price, while also comparing coverages. It only takes a few minutes to find a great deal on an auto insurance policy that has the coverage you need. When it comes to cheap car insurance, Rates.ca is a one-stop shop for Canadian drivers.
Let us know your renewal date and we’ll let you know the best time to shop the market for the cheapest car insurance rates.