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A car insurance quote estimates your premium for a car insurance policy. Insurance companies calculate the quote using the information you provide, such as your age, the car you drive, your driving history, and your postal code. Every insurer uses a unique formula to calculate your car insurance quote, so even if you provide the same information to different insurance companies, no two quotes will look the same.
After applying for a policy, an insurance company's next step is to figure out how much risk you pose to them — what is the likelihood of you getting into a car accident, and how expensive will the damage be?
Insurance companies use roughly the same methodology to assess risk. Here are the main things that influence your rate:
In addition to the criteria above, car insurance companies in Ontario can also use the following factors to calculate your rate:
Depending on your answers, insurers will place you in a specific rating group (people with similar profiles). Your rating group determines how much you pay for coverage.
Insurance companies have an ideal customer they want to attract. Most insurers reserve their lowest rates for experienced drivers over 50.
On the other hand, some companies are willing to assume more risk, so they offer inexperienced drivers coverage at competitive rates. You can't tell which insurer will provide you with the lowest rate based on their advertisements. It's better to compare rates from multiple insurance companies.
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There are more ways than ever to get car insurance in Canada. Here's an overview of the four primary providers of car insurance quotes in today's marketplace.
Which car insurance company is right for you? It's impossible to know for sure if you don't shop the market.
Insurance companies charge different rates for the same coverage. That means there are savings to be found. Last year, drivers who shopped for car insurance quotes on RATESDOTCA saved an average of $882 on their annual premium.*
RATESDOTCA makes insurance transparent, simple, and fun. By comparing quotes, you can easily see which company offers you the best insurance rate based on your unique driving history and insurance needs.
Find out why people trust us to find the cheapest car insurance quotes in Canada and compare rates today. Ready? Let's get started.
Ontario, Alberta, the Maritimes, and the territories have private insurance markets, meaning you can get quotes from multiple insurance companies. Ontario's car insurance market is the largest in Canada, with the most insurance companies competing for business.
British Columbia, Saskatchewan, and Manitoba have public insurance systems, meaning that Crown corporations provide driver coverage.
Quebec has a hybrid system. The Société de l'assurance automobile du Québec, a Crown corporation, provides partial accident benefits. Third-party liability coverage, which is mandatory, can only be bought through a private insurance company. Quebec drivers can only buy optional car insurance coverages from private insurance companies.
Regardless of whether your province has a private, public, or hybrid system, drivers in Canada end up with insurance policies that mostly resemble each other. The process of obtaining a quote differs based on which regime exists in your province. The insurance-buying process in public car insurance systems happens when you register your vehicle. Whatever the province charges you is the final price — you can't shop around.
In the private system, vehicle registration takes place separately from the insurance-buying process. You can buy insurance directly from an insurance company or shop around using a rate comparison site and see which provider offers the lowest rate.
There are different types of quotes you can get depending on how you use your car. We'll explore each one.
Personal car insurance quote
Car insurance for personal use goes by different terms in the insurance industry. You might hear an agent or broker refer to it as insurance for a "private personal vehicle" (PPV) or as a "personal line." Most people need this type of car insurance. A personal-use vehicle is for commuting to and from work, running errands, and pleasure (road trips, for instance). Rate comparison sites mainly cater to people seeking insurance for their own cars.
Commercial car insurance quote
If you own a business that requires the daily use of a company-owned vehicle, you need commercial car insurance. A personal car insurance policy won't provide coverage if you're involved in an accident with the company car. Rate comparison sites often don't offer quotes for such policies. Still, they can refer you to a broker who specializes in commercial insurance. The broker can then show you quotes from various commercial car insurance companies.
Ride-sharing car insurance quote
This insurance product is a complicated one. Think of ride-sharing insurance as more akin to an endorsement (an optional coverage that you layer on top of your standard policy). Because of that, you can't purchase it from an insurance company other than the one that provides your base policy. This makes it challenging to shop the market for the lowest ride-sharing quote. However, some ride-sharing platforms have taken the initiative to extend insurance coverage to drivers, making getting insurance less hassle.
Suppose you're driving for a platform that does not offer insurance through the app. The insurance company that provides your personal policy might agree to extend some coverage while driving for the app. Still, you must notify your insurance company before you become a driver for the ride-sharing platform.
Even if you drive for an app that provides insurance, you still need to notify your car insurance company before becoming a rideshare driver. Your insurance company could cancel your coverage otherwise.
A standard quote can refer to a standard auto insurance policy or a customer deemed to be at average risk to insure.
There are three tiers of clients in the insurance world: preferred, standard, and non-standard.
Preferred clients will receive a preferred auto insurance policy. They have a long insurance history and have had no accidents or only one or two minor ones.
A non-standard policy is insurance lingo for a policy created for a person considered risky to insure.
All three types of customers will have access to the same kinds of coverage. However, the amount the insurance company will charge each tier will vary.
Standard clients will get an average rate, while preferred clients will access the company's lowest rates. Non-standard clients will pay the most for identical coverage and have to pay higher deductibles.
Insurance companies will label you as high-risk if the following incidents are on your driving and insurance records:
Every Canadian province and territory requires drivers to have car insurance. The types and amounts of coverage needed vary by location.
Mandatory car insurance requirements typically include the following coverages:
Third-party liability: This coverage protects against losses incurred from third-party claims when you're at fault for causing an accident. This includes damage to someone else's property, bodily injury or death. Your auto insurance quote will always include third-party auto insurance coverage since it's mandatory across all provinces and territories in Canada.
Direct compensation-property damage (DCPD): This coverage means the insurer compensates you directly when your vehicle is damaged in an accident for which you are not at fault. It covers the damage to your car, its contents and the loss of use of your vehicle. Property damage coverage is mandatory in most provinces.
Uninsured automobile protection: This coverage protects you if you get in an accident with someone who does not have valid insurance coverage. It can also protect you if you're the victim of a hit-and-run.
Accident benefits: This coverage protects you from injury in a collision, whether you are the driver, a passenger, a pedestrian or a cyclist. There are four primary accident benefits: income replacement, medical, death/funeral, and miscellaneous.
These types of coverage are usually optional and can be added to a car insurance policy if you want extra protection. Note that in some provinces or territories, these coverages may be mandatory.
Collision coverage: This coverage protects your vehicle against damage from a collision with an object (like another car). With this coverage, your provider will pay to repair or replace your vehicle up to its actual cash value, regardless of who is at fault. Collision insurance is not mandatory, except in Manitoba.
Comprehensive coverage: Comprehensive insurance covers non-collision damage to your vehicle, such as theft, hail, vandalism, etc. Comprehensive insurance is only mandatory in Manitoba.
Specified perils coverage: This coverage protects against damages caused by named perils, such as theft, attempted theft, explosions and natural disasters like fire or lightning. Only perils specified by the policy are covered.
All-perils coverage: This coverage is a combination of both collision and comprehensive insurance. All-perils coverage protects your vehicle from all causes of loss except those directly mentioned as exclusions in your policy. It also provides additional protection if your car is stolen or damaged by another driver.
Insurance endorsements are another optional coverage type, often referred to as "riders."
These coverages are purchased in addition to your base policy and change the terms of the contract. Endorsements can be used to add, delete, alter, or exclude coverage and adding them will increase the cost of your insurance.
Endorsements can be added at any point, meaning you don't have to wait for your policy's renewal period to adjust your coverage.
Here are the most common endorsements available to drivers in Ontario and Alberta.
Alberta has two categories of endorsements: Standard Endorsement Forms (SEF) and non-standard endorsements.
Non-standard endorsements have conditional approval from the Superintendent of Insurance and are offered by insurance companies that look to address unique coverage needs. SEFs have been approved for use by the Superintendent of Insurance and are commonly available in Alberta. The most popular endorsements in Alberta are listed below.
Saskatchewan, Manitoba and British Columbia operate within a public car insurance model. Car insurance in these provinces is available through the government. In other provinces, including Alberta and Ontario, drivers must purchase insurance from private insurance companies. Quebec is the only province that uses a mix of both.
In each province and territory, a minimum amount of auto insurance is required by law. This typically includes third-party liability insurance, which covers medical expenses and property damage caused by the insured (aka, you). There’s also some level of accident benefits or property damage coverage that is also mandatory.
Average rates vary across the country. According to the Insurance Bureau of Canada, Ontario has the highest average auto insurance rate in Canada, averaging $1,655 per year. British Columbia and Alberta are in second and third place, averaging $1,582 and $1,514, respectively. Drivers in Quebec pay the least in Canada, with an average premium of just $857.
Below are the required car insurance coverages in each province as well as the optional products drivers can buy to enhance their policy.
*IBC with data from GISA exhibits AUTO1010-TER-2020
Public
Private
Physical damage coverage
Personal injury benefits
At $857 per year, Quebec currently has the cheapest car insurance premiums in Canada, while Ontarians pay the most at $1,655 per year on car insurance, according to the latest data from the Insurance Bureau of Canada.
Why is insurance more affordable in Quebec? In short, drivers only pay to insure their car. Accident benefits are paid for by the government.
Mandatory insurance includes $50,000 in third-party liability, which only applies to car accidents outside Quebec, and direct compensation property damage.
Medical care delivered by private health care providers — dental care, physiotherapy, occupational therapy, and therapy — is reimbursed by Quebec's public automobile insurance plan. The plan is funded by driver's licence and vehicle registration payments, not premiums.
Injured Quebec drivers also can't sue for any damages.
On the other hand, Ontario drivers have access to rich benefits packages.
In Ontario, drivers must hold at least $200,000 in third-party liability, and their insurance companies reimburse them for medical expenses not covered by the province. They also have the right to sue for damages and economic losses.
Insurance experts say fraud drives up the cost of coverage for everyone and is more prevalent in Ontario than in other provinces due to the substantial payouts.
The considerably different market conditions in Ontario mean drivers there end up paying more.
| Province or Territory | Average Annual Premiums |
|---|---|
| Alberta | $1,514 |
| British Columbia | $1,582 |
| Manitoba | $1,200 |
| New Brunswick | $1,014 |
| Newfoundland & Labrador | $1,251 |
| Northwest Territories | $978* |
| Nova Scotia | $1,066 |
| Nunavut | $1,033** |
| Ontario | $1,655 |
| Prince Edward Island | $885 |
| Quebec | $857 |
| Saskatchewan | $1,274 |
| Yukon Territories | $889** |
Sources:
Ontario, Alberta, Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland and Labrador – IBC with data from GISA exhibits auto1005-2020-ON, AB, and ATL; British Columbia (ICBC only)- ICBC Annual Report; Manitoba - MPI Annual Report, private insurers; Québec - Société de l'assurance automobile du Québec; Saskatchewan- IBC calculation with data from SGI, SAF, and private insurers; SK premiums are a proxy per policy for all vehicles.
* Annual average of year 2017
**IBC with data from GISA exhibits AUTO1010-TER-2020
There are a lot of tactics you can use to lower your car insurance premiums, but some make more of a difference than others. Here are the most impactful moves you can make to lower your rate.
The vehicle you choose has an outsized impact on how much you pay for insurance. It's perhaps even as consequential as driver behaviour, potentially more. Choose a vehicle that's less likely to be stolen. The Insurance Bureau of Canada publishes a list annually of the most frequently stolen cars. While thieves often target luxury car brands like Lexus, brands like Toyota and Ford make up a significant portion of thefts.
Also, remember that a fully-optioned car will cost more to repair or replace and, therefore, to insure. A vehicle with a basic trim, on the other hand, will have lower potential claims costs and will be less expensive to insure.
Lastly, avoid financing a car. Loan providers and lessors make you purchase comprehensive insurance coverage for the vehicle. It ensures the lender doesn't lose their investment if you default on your loan.
This tip doesn't result in immediate savings, but it's up there with buying a cheaper car to keep your premiums low.
Don't rack up traffic tickets, avoid making insurance claims, and always pay your premium on time. Suppose you can maintain a spotless continuous insurance history over the years. Insurance companies will eventually offer you their preferred (lowest) rates.
To protect your reputation as a great driver, consider purchasing an endorsement that covers you from a rate increase on your first at-fault accident. A reputation for good driving behaviour takes time and effort to establish. Still, it will significantly impact your insurance rates in the long run.
Your car loses value over time. At some point, your car will depreciate to the point where it would be cheaper to replace rather than continue paying for collision and comprehensive insurance. Vehicles five years old or more typically don't need collision or comprehensive insurance.
The deductible is how much you agree to pay out of pocket for damages before your insurance company pays out your benefit. If you offer to shoulder more of the expense, your insurance company will lower your premium.
If you drive 12,000 kilometres a year or less, consider getting a usage-based insurance policy. When you apply for a car insurance policy, insurance companies ask you to predict the number of kilometres you expect to log over the coming year. This leads some people to inflate the number to stay on the safe side. A usage-based policy offers more flexibility than a traditional policy. After you use up your base number of kilometres, you pay for every extra 1,000 kilometres you drive. Essentially, you can err on the side of being a low-mileage driver, reap a cheaper premium, and pay the difference on the off chance you do go over your allotment of kilometres.
Telematics refers to insurance technology that monitors your driving habits. Insurance companies give you a compact sensor you install in your car and pair with an app.
Together, the devices can monitor your speed, how hard you brake, and the distance travelled. If the device reflects cautious driving habits, you'll receive a discount at renewal — up to 20% in some cases. Some insurance companies offer an initial discount for enrolling in the program.
Telematics programs are available in Ontario, Nova Scotia, New Brunswick, Quebec, and Alberta. One word of caution: insurance companies can use the information to raise your rates in Ontario.
Be sure to compare rates. Car insurance companies in provinces with private insurance markets don't charge the same for coverage. The price of your car insurance depends on the insurer you choose. In 2022, RATESDOTCA drivers saved an average of $882* annually in Ontario. Both the Auto Insurance Rate Board of Alberta and the Financial Services Regulatory Authority of Ontario recommend shopping around as a strategy to find a lower rate.
However, be wary of switching insurance companies midway through your term, as this will likely result in a premium increase. Waiting until your renewal period is recommended to avoid cancellation penalties.
No. All registered vehicles in Canada must have insurance, as required by law. If you own and drive a vehicle, you are required to take out a basic car insurance policy that includes all mandatory coverages. You also risk having your license suspended, and your vehicle impounded, not to mention facing sky-high insurance rates in the future.
Here are the penalties for driving without insurance in some provinces:
What you see is what you get. The auto insurance quotes you receive are accurate, based on the details you provide. A representative from the insurance company will confirm your information before issuing a policy. As long as your details stay the same, so will your rate.
A deductible is the amount of money you agree to pay in the event of a claim before your insurance coverage kicks in. A driver with a $500 deductible and $2,000 in damage resulting from an accident will pay $500 out of pocket while the insurance company covers the remaining $1,500. Think of a deductible as your share of the repair cost.
Your deductible will also determine your policy premium. The higher the deductible you are willing to pay, the lower your insurance rate will be.
RATESDOTCA partners with over 50 top insurance companies in Canada, more than any other comparison site. Our partners include Intact, Aviva, Wawanesa, Jevco and Echelon, to name a few. See our full list of insurance partners here.
RATESDOTCA is 100% free, and we are committed to saving you time and money.
What's the catch?
There's no catch and no hidden costs or strings attached. We make our money from our partners, not from you.
Is it cheaper to shop direct?
No. Your quotes come straight from auto insurance companies. They are the same rates you would get if you called them directly.
The last word
RATESDOTCA makes buying car insurance easy. We compare more insurance providers than anyone else, so you can be confident that you are getting the best deal.
*Estimated premiums based on a 35-year-old male with a 2019 four-door Honda Civic and a driving school certificate versus someone with the same driving experience but no driving school. Optional coverages: collision, comprehensive ($1,000 deductible). Savings vary by insurer, driver profile, and vehicle. Actual savings may differ.
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