Student Car Insurance

Your guide to understanding student car insurance in Ontario

Student car insurance

Whether you are a college or high school student, or are the parent of one, understanding your car insurance options and the types of coverage you need will help you make the most informed decision. This guide aims to break down the most commonly asked questions about student car insurance.

What is student car insurance?

When we say student car insurance, we’re referring to G1 and G2 class licences, which are part of the graduate licensing system in Ontario. Did you know that in Ontario, there are 15 different classes of car licences? Licenses that a driver could hold are, class A, B, C, D, E, F, G, G1, G2, M, M with L condition, M1, M2 with L condition. The G Class graduated license refers to operating your standard vehicle. To get a full G license in Ontario, you are required to graduate from one level to the next, which is why it is called a ‘graduated’ licensing system.

Understanding the graduated license system in Ontario

G1: This is your learner’s permit. To apply, you need to be at least 16 years old, go through and pass an eye examination, and complete a written test on road traffic rules and signs. This will enable you to drive but there are restrictions. For example, a G license holder must be in the passenger seat at all times. You cannot drive between 12 am and 5 am or drive on the 400-highways as a G1 driver.

G2: To graduate to G2 level, you must have had your G1 license for a year if you did not take a Ministry of Transportation- approved driving school program, and 8 months if you did complete an accredited training school program. You will also be required to pass a road test. Once you pass and get your G2, you do not need an experienced driver with you in the vehicle on the roads anymore, but there are certain restrictions that you must abide by.

Full G: Once you have had your G2 for at least a year, you must take and pass another road test to graduate to your G licence. Once you pass, you are eligible to drive without the previous restrictions. However, if you are 21 or younger, there are certain restrictions that do apply.

As always, the law in Canada is that a vehicle must have a valid auto insurance coverage with minimum liability to drive on the roads, so ensure your name is added to the policy of whomever’s vehicle you’re using as you graduate through the program.

FAQ - Frequently asked questions about student car insurance

Does being a student affect car insurance?

Yes, your age and driving experience have a direct impact on your car insurance rates.

Young drivers in Ontario are considered to be any driver under the age of 25. If you’re in this category, it’s normal for your premiums to start off high when you get your first car insurance policy. Data shows that younger and less experienced drivers are more likely to be involved in accidents or collisions on the road, resulting in a higher likelihood of claims. The higher the risk, the higher the insurance premiums.

However, there are also some perks. You can be added to your parent’s car insurance policy as an occasional driver at a lower premium, which can help you begin to establish an insurance record of your own.

There are also discounts available through some companies for students with good grades and students who have passed a ministry-approved driver’s training program.

How much is car insurance for a student in Ontario?

Since drivers under the age of 25 have a higher likelihood of getting involved in an accident, insurance rates are higher for younger people.

Once you’re over the age of 25 and you have maintained a clean driving record, you might start to see a decrease in your annual premiums as a reward. Turning 25 is a great opportunity to compare car insurance rates as you might be eligible for significant savings.

Do students get discount on car insurance?

Students are eligible for all kinds of discounts, including:

  • Good Student’ discount

This discount is a financial reward for full-time student drivers between 16 and 24, who do well in school by maintaining good grades. Savings vary but range around 10% to 15%. If you can show proof of your good performance at school, whether you maintain your grades and GPA levels, or are in the Dean’s list, you can apply for this discount.

  • Driver’s training

Complete a Ministry of Transportation approved driver’s training program to be eligible for discounts from some insurance companies.

  • Graduate through the licensing system

Some companies give discounts when you graduate from a G2 to a full G.

  • School associations

Many colleges and universities in Ontario are affiliated with insurance companies, allowing students to get better rates.

What other ways can a student driver lower their car insurance premium in Ontario?

  • Drive smart: Establishing a clean driving record and building a claims-free insurance history is important, as it is the main determining factor when it comes to your insurance costs. Drive smart to avoid accidents, keeping your record clean and rates down as a result.
  • Take public transit: Insurance companies take your daily commute into consideration when determining your rates. If you drive to school every day, that theoretically increases your likelihood of a claim since you’re on the road more, possibly during the busiest hours. Using public transit can help lower your insurance premiums.
  • Bundle policies: Insurance companies offer discounts when you bring two or more insurance products under one company. If you are a university student staying away from home, for example, you could bundle your tenant insurance with your car insurance policy to save on both.
  • Buy the right car: Are you thinking of buying your own vehicle? Check with the Insurance Bureau of Canada and other sources to see how different cars measure up and assess their ratings before you make the purchase. Purchasing a slightly older model with modern safety features can help your insurance premiums to come down. Certain models cost more to repair and find replacements, so insurance is higher for those vehicles. Before you buy, run quotes on the different vehicles to get an idea of what your car insurance payments might be.

It also helps to understand how auto insurance works in Ontario, the kind of coverages that are mandatory, what additional coverages are available, and what deductibles are. This will help you make an informed decision. Check out our car insurance guides to learn more. From all about renewals, to car insurance claims to knowing some of the myths surrounding car insurance – our car insurance guides will take you through everything you need to know.

Wait. Am I not covered under my parent’s car insurance?

If you live in the same home with the same address as your parents, you may be covered by their car insurance policy, but you need to be listed as an occasional or secondary driver. This will have an impact on their insurance premiums, but it will also help you to build your own insurance history.

Car insurance policies are tied to the vehicle and cover anyone driving the vehicle with the policy holder’s permission. If you live in the same household, and are not a policy holder, your parents should ideally add you into their policy to ensure everyone is covered in the event of an accident. Whether you get your own insurance policy, or your parents add you to their policy, never drive without insurance. It is illegal.

Once you move out and become the primary driver of a vehicle (even if it is under your parents’ registration), you will need insurance[AMT1] . Look for discount opportunities to save money on insurance. There are many ways to get discounts on your car insurance rates, including being affiliated with your college or university, installing anti-theft systems on the car, increasing your deductibles, or taking a driver’s education course from a Ministry of Transportation approved driving school. Ask your insurance professional what additional discounts might be available to help you save.

Where can I buy car insurance as a student in Ontario?

Just because your parents have been using the same insurance company for years does not mean you need to as well. Shopping around for car insurance rates online will help you see what else is out there, including better deals. As a student in Ontario, you’re probably already on a tight budget with tuitions, books, and probably rent. The last thing you want to do it overpay for your car insurance.

Use our calculator that doubles up as a quote comparison tool to get an estimate of your car insurance costs and find out how much you can save on your car insurance!

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