Most of us who live in Ontario think about Auto Insurance before purchasing a vehicle. The reason is obvious – Cost of Car Insurance. As per driving.ca residents of Ontario pay the highest in Auto Insurance in Canada. Changing a province of residence is not the best way to reduce your car insurance premium. So the other alternative is to look in to options to reduce the auto insurance rates.
Here are 5 main tips to Save money, when it comes to your Auto Insurance:
Maintain a Good Driving Record
Insurance companies want every driver with a good driving history/record. If you maintain a good driving record free of accidents, convictions, license suspensions, non-pay cancellation then you will be eligible for some of the best rates. Convictions/tickets, non-pay cancellations affect your insurance for 3 years and accident affects your insurance for 6 years.
Discounts and Deductibles
There are number of discounts available to Auto Insurance customers. They all have some eligibility criteria but there is no harm in talking about them with your broker. Some of the most common discounts are Multi vehicle discount, multi lines discounts (for having home and auto insurance with same company), Good student discount, Graduated licensing discount, Driver training discount, Retiree discount, winter tire discount, conviction free discount.
Increasing deductibles reduces your premium too but you have to be very careful with it. Deductible is the amount you pay first in the event of a loss or claim. You need to have this amount handy all the time. Your broker will advise you based on your individual situation the amount of deductible you should choose.
Telematics – Usage based Insurance
This is a new development in the Auto Insurance sector. Some companies are offering it with an initial start up discount and you can build on it by practicing safe driving. You are given a small device to plug in your vehicle or asked to download an app. Typically it measures how you accelerate, how you apply brakes, time of day/night you drive the vehicle and mileage.
Hire a Broker
An Insurance Broker is an insurance professional who provides unbiased advice at no cost. He / She will shop the market for you. It is in the interest of the broker to provide the best coverage, at the best cost to you as he / she is paid commission by the insurance company. Also, a broker will advise you about selecting the best coverage. Sometimes it’s not worth buying full coverage for an older vehicle. Your best cost-effective insurance is always with an Insurance Broker.
What affects my Car(Auto) Insurance Premiums?
There are 4 main factors that affect your Auto Insurance In Ontario:
1) The vehicle your drive (Year, make and Model)
2) The area you live (postal code)
3) Your driving record (years licensed, at fault accidents, moving violations, non payment cancellations, license suspensions, years continuously insured, cancellation of the policy due to misrepresentation/non disclosure)
4) The use of the vehicle -commute, pleasure, business or commercial
You can always talk to your Broker about Insurance discounts that help manage the prices if its too expensive but not at the cost of getting a substandard product.
Some common auto insurance discounts are:
- Home and Auto Discount ( combine them to save in the long run)
- Winter tire discount (always have installation receipts of the winter tires. It is a requirement of most companies to have them installed before November 1 to April 31)
-Conviction free discount
- Loyalty discount
- Now a days a popular one is telematics (Usage based insurance - install a device in your car and get your use tracked).
- Good student Discount and Graduated License Discount ( for under 25 year old drivers)
Fun Fact- Color of the Car has no effect on your Auto Insurance.