Tips to get a cheaper car insurance rate in Canada

Get quotes from as many insurance companies as you can.  

Car insurance is mandatory in Canada, but that doesn’t mean you need to stick with your current car insurance provider or the one favoured by your family and friends.

Car insurance providers will happily offer you a quote at no charge. This way, you can get a close estimate of what you can expect to pay annually.

Don’t take our word for it: even the Financial Consumer Agency of Canada recommends applying for quotes as the first step when buying car insurance.

A licensed insurance broker can retrieve multiple quotes for you.

You can also use a rates comparison site like insuranceattorney.xyz Our network includes over 30 Canadian insurance providers. We’ll show you what rates insurance companies are willing to offer you, starting with your lowest quote.

Make sure your application is accurate. 

When you apply for quotes through a broker, you want to make sure that the information you provided during the screening process is accurate.

That way, you know the rates offered to match what you’ll be charged when signing the contract.

You can expect to be asked about the following:

• Vehicle information (year purchased, make, model)
• Driver information (licensing dates, claims and convictions history)
• Discount information (interest in bundling home insurance)

Many car insurance providers and brokers offer the ability to apply online for quotes. One thing to watch out for is sites that ask too few questions.

Rethink how much insurance you really need  

We’re not suggesting you skimp on insurance coverage to save some money in the immediate future. However, you could wind up adding optional insurance coverage to your policy that might not be worth the investment. For example, collision and comprehensive coverage on an older car: you could use the money you would pay for these extras and invest it into buying a new car out of pocket.

One place where many Canadians are chronically underinsured, though, is third-party liability insurance. The mandatory minimum limit in most provinces is around $200,000, whereas insurance experts recommend increasing it to at least $1 million. After all, the cost of legal expenses, decisions, and medical care have increased since the minimum limit was set.

Offer to pay for the whole year upfront  

This might not be feasible if you’re a young and inexperienced driver (this group tends to pay some of the highest rates). But, if you’re a driver in your thirties or older with a clean driving and insurance record, paying for the whole year upfront will often save you some cash.

When you pay month-to-month, administrative fees are tacked onto your bill. You’re saving the car insurance provider money when you pay for the year at renewal time.

Apply for as many discounts as possible 

Insurance companies offer lots of discounts. Here are some of the most common ones:

• Winter tires discount: In Ontario, you can save about 5% annually on your insurance if you keep winter tires between Nov. 1 to Apr. 1. The winter tire discount is applied at renewal time.
• Dashboard camera discounts: If the time comes to make a claim on your insurance, video footage from your dashcam will provide objective evidence, making it easier for insurance adjusters to determine fault.
• Anti-theft device: Insurance companies offer discounts for drivers who make investments to make their cars harder to steal. Insurers favour the following devices:
  • Starter disablers
  • GPS trackers
  • Car alarms
  • Steering wheel locks

You might consider using a combination of devices. Faraday bags are a must-have accessory for all cars with keyless entry: these pouches will block any signal that tries to clone your key fob.

Try usage-based insurance  

This product qualifies as a discount, but it gets its own section given what a game-changer it has proven itself to be for urban drivers.

Think of it like one of those retro pay-as-you-go cell phone plans.

With usage-based insurance (UBI), you pay for a baseline number of annual kilometres, usually about 10,000 km. If you exceed that, your insurance company will charge you for every extra 1,000 km or so.

In order for the insurer to keep tabs on your mileage, you must install a monitoring device in your car.

Try telematics  

Telematics is similar to UBI. It adds a layer of data collection, though. With a telematics device installed, your insurance provider will monitor your driving patterns, like your average driving and braking speeds, not just your kilometres.

You must install a monitoring device or an app on your phone to participate. It can amount to discounts in the region of 20% at renewal time plus an initial discount for signing up.

One thing to note is that insurance companies are allowed to use your data against you in Ontario. If the device detects unsafe driving, your insurer could increase your premium.

Keep insurance costs in mind when you shop for a new car

The make and model of the car you choose will determine how much you pay for insurance.

Used cars that have already depreciated in value usually command lower auto insurance rates.

Despite being older, some used cars still attract thieves. If you want to keep insurance costs down, consider checking to see if the car you’re eyeing has made it on the Insurance Bureau of Canada’s most stolen list. Cars that make the list usually have higher than average insurance premiums.