We get asked this question a lot, so let’s get it out of the way! Truthfully, there’s no easy answer. Insurance is the business of risk. Based on your age, driving experience, address and other factors, insurance companies will assess the likelihood of you needing to make a claim during the term of your policy. It is this risk assessment that determines how much your monthly car insurance premiums will cost.
Further complicating things, every insurer has their own formula when translating risk into a real insurance quote. For example, some companies are willing to offer reasonable rates to young drivers, in the hope that they can secure a long-term customer, while other companies are reluctant to insure this demographic at all, and will quote a very high price for everyone under the age of 25. 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.
The point is, it is impossible to say which company will offer you the best deal without asking you a few quick questions first. Our car insurance comparison tool only takes a few minutes and once complete, we’ll show you a customized list of car insurance quotes from Canada’s best insurance companies. All you have to do is compare coverages and pick the cheapest rate. Voila!
Follow these tips to give yourself the best chance of finding cheap car insurance.
Online comparison tools like RATESDOTCA offer the fastest way to get multiple insurance quotes. Not only can you find multiple insurance quotes and coverages in one place, but 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.
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. This means better rates!
A poor driving record is understandably 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. So drive safe and keep your rates low.
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.
The more time you spend on the road, the higher your likelihood of getting into an accident. Therefore, when an insurance company asks for your annual mileage, a lower number is better. Review this every year to ensure it is still accurate. A seemingly small reduction in driving each week can add up to big savings.
Tip: Your commute time is often the biggest determining factor in your annual mileage. If you switch jobs and don’t have to drive as far, or decide to start taking public transit, let your insurance company know. Trust us, it pays to make that call!
If you are a new driver, reassure insurance companies that you are low risk by taking a recognized driver’s education course. Most companies are willing to offer new drivers a reduced rate for successful completion. You can find a list of registered and approved driver training programs on your province’s transportation ministry website.
All Canadians are advised to install winter tires once the temperatures begin to dip below 7°C. Winter tires are mandatory in Quebec, and drivers in other provinces will usually get a better rate for taking the same precautions. We’re talking an easy 5% savings.
Several 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 be used to increase your premium. This is often desirable for newer drivers that drive well, as it can reduce the higher rates that come with less experience.
Having anti-theft devices (i.e. alarm, car immobilizer, and GPS tracker) will not only reduce the chance of your vehicle being stolen, it can result in an insurance discount, too. Not all anti-theft devices lead to discounts, so ask your insurer about which ones they recognize and recommend.
If you have 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 may reduce each premium by as much as 15%.
Many Canadian households have two or more vehicles. Insuring them all with same company can result in savings up to 20%.
The coverages and limits you choose will impact your premium. The more insurance you need, the more you have to pay. Review your policy at least once a year to see if you can remove anything.
For example, if you drive an old car, it might make sense to get rid of collision and comprehensive, as the cost of repairs (even just paying a $500 deductible) may be greater than the value of the car itself.
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.
The rule of thumb is the higher your deductible, the lower your monthly insurance premium. A higher deductible means you’re agreeing to take on a larger portion of the cost in the event of a claim, thus reducing the financial obligation of the insurance company.
For example, if your deductible is $1,000 and you're involved in an accident that causes $1,500 worth of damage to your car, you will be required to pay $1,000 towards the claim, while the insurance company will cover the remaining $500. If your deductible is only $500, the insurer would need to shell out $1,000.
If you are confident in your ability to stay accident free, choosing a higher deductible can save you money. But remember, it also results in greater financial burden if a claim has to made against the policy. Deductibles are applicable to optional coverages such as collision, comprehensive, specific perils and all perils as well.
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.
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, or a university alumnus. Ask about group discounts for specific memberships and see if any apply to you.
Not eligible for a group discount? Discounts are sometimes offered for other reasons, too. Owning a hybrid or electric car, getting a good grade point average, or being a retiree are all examples of other discounts available at some insurance companies. Ask and you shall receive.
Everyone likes to save money, but when it comes to car insurance, cheaper doesn’t always mean better. Before deciding on an insurance company, make sure you understand the coverage they are offering.
Aggregator sites like this one make it easy to find a low price, while also comparing coverages. Answer a few simple questions and you’ll get a list of the cheapest available rates from over 50 trusted, well-known providers.