When you are shopping for your auto insurance, it is important that you understand how insurance policies work.
Ontario law requires that all motorists have auto insurance. Fines for not carrying valid auto insurance can range from $5,000 to $50,000 in addition to the likelihood of suspension of your license and impounding of your vehicle. If you are convicted of driving without valid auto insurance, you are considered as a high-risk driver and your insurance company can refuse auto insurance or charge you a very high premium.
If you are injured in an accident while driving or occupying an uninsured vehicle, you may not be entitled to compensation or allowed to sue the at fault driver. Furthermore, if you are found to be at fault for an accident causing injury or death, you may be held personally responsible for the victim’s medical costs and other losses
Insurance policies can be purchased directly from an insurance company or an agent of the insurance company of your choice. Policies can also be purchased from Insurance brokers, who find the best policy based on the client’s needs from a variety of insurance companies.
Here are some tips in the form of six important criteria to consider when you choose your insurance agent, broker or company:
- You deal with a licensed agent, broker or company in Ontario. Licensed agents are listed in the Financial Services Commission of Ontario website.
- Rates for insurance policies vary from one company to another for similar policies. In the long run, we recommend your do exhaustive research on all the plans available from as many insurance companies as possible.
- While basic coverage for auto insurance policies are standardized to a degree, the coverage can vary from one to another. Please compare coverage such as deductibles, limits, optional coverage etc. before you buy.
- Most companies have some accident forgiveness provisions or you can request one. You may want to question company practices when it comes to at fault claims or circumstances under which you are denied insurance coverage.
- Since June 1st 2016, insurers can no longer use one minor at fault accident within a 3 year span to increase premiums when the damage is less than $2,000 and is paid fully by the at fault driver.
- It is not always smart to buy the cheapest auto insurance policy. It is important to compare service terms.
- It is important to select an agent, broker or insurance company who is easily accessible, take time to explain details and readily available if and when you file a claim.
Finally, any information you provide the insurance company must be accurate and honest. Your insurance company has the right to cancel your policy if any of the information given is not correct or complete.