Canadian Auto Insurance Facts
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Alberta Auto Insurance Myths
029 days
by admin
in Uncategorized
To many people, auto insurance can seem really complicated, especially with the wealth of myths and misconceptions about how it works. More often than not, it is these myths and misconceptions that wind up making you lose out in the end. The following is a list of the most popular myths about auto insurance along with the reality that lies behind each one.
Myth: It is more expensive to insure a red car.
Whether the car is black, beige, taupe, red, silver or a unique mixture of that embedded with some flame decals, the same make and model of a car with a varying colour will have the same rate; the colour that your car is has no bearing on the rates. The only things that do affect the rate of your auto insurance is its year, model, make, engine size, body type, the drivers on the policy and the age of the vehicle.
Myth: It is pointless to shop around for auto insurance if you are under the age of 25.
No matter how old you are, shopping around for your auto insurance can save you a great deal of money. Indeed, younger drivers must face the problem of having to pay for a higher rate of insurance, it can still make a significant impact on your monthly payment if you elect to shop around. There are usually different rates for drivers over the age of 25, but your premium ultimately depends on your driving record besides your age.
Myth: If you use your car for work, your employer’s insurance has your back.
Your policy affects the personal use of your car rather than commercial use. This means if you use your car for a courier job or a delivery task, you will not receive coverage from your employer’s insurance. Though you may receive a reimbursement for your mileage costs, you will not wind up having coverage if you get into an accident while on the job.
Myth: If you get into an accident, your rate will increase.
While possible, this is not necessarily true. If you cause the accident, then your rate is directly affect. However, you should also note that if you do wind up with a rate increase, your accident may not necessarily be the cause. Keep in mind that insurance rates are typically adjusted to keep up with your situation, which includes the number of claims in your neighbourhood, inflation, the statistics for accidents with others who drive your kind of car as well as other factors.
Myth: A friend who wrecks your car can cover it with his insurance.
Actually, remember that his insurance covers his car, and your insurance covers your car. To make it simple, consider your insurance to be a part on your car. That is, if you lend someone the keys to the car, you are also lending them your insurance. Remember this and consider the way your premium will be affected in the event of an accident. This also means you could be financially responsible if they wreck your car.
Myth: Auto insurance rates are not regulated, so companies can charge you anything.
Contrary to popular belief, rates for auto insurance are actually very strictly regulated. With the exception of Quebec, the law in all provinces states that insurers are required to submit their rates for approval to government agencies. These regulators will then review how the insurers are determining their rates and then ultimately decide whether or not it seems fair. After filing the rates with these entities, it is impossible to change them until the next filing comes around.
Myth: My rates will be the same as the rates my neighbour gets.
As it was previously stated, there are numerous factors that determine your rate: your neighbour isn’t one of them. Factors that determine your rates include age, the type of vehicle and your driving record. As all situations are unique, your rates will vary.
Myth: Drivers in all sorts of situations are covered under “comprehensive” coverage.
Indeed, comprehensive coverage is just one sort of protection that is available on a policy — with the others being Uninsured Motorist, Collison, etc. However, this type of coverage will only pay for damages incurred outside of a collision.
Quebec Car Insurance Myths
040 days
by admin
in Uncategorized
A Red Car Costs More to Insure
The first myth that a red car is more expensive to insure than that of another colour has not been found to be true. So many things go into determining a person’s car insurance rates, and the vehicle is part of the equation but colour is not. For example, car insurance companies are interested in the make and model of the car, how many miles are driven, where the car is parked and driven and also whether the car has anti-theft devices. If the vehicle has features that make it safer to drive such as anti-lock brakes, the car’s owner will receive lower rates, even if the car is red.
Parking Tickets Increase Car Insurance Rates
Some people have several parking tickets, and they worry that their car insurance rates will be affected by them. These people can stop worrying because parking tickets do not affect car insurance rates at all. On the other hand, tickets for moving violations, such as speeding tickets, do have a negative affect on car insurance rates. Parking tickets may indirectly affect car insurance rates because failing to pay them makes it difficult for people to renew their driver’s licenses.
Speeding Tickets for Slower Speeds Are Not As Bad As Those for Higher Speeds
Drivers have a belief that if their second speeding ticket is for driving 5 kph over the speed limit, this is not going to affect their rates because their first speeding ticket was for driving 10 kph over the speed limit. It depends on when these tickets were received. If the first ticket was from five years ago, the insurance company may not raise the rates for the second ticket, but if these tickets were received within one year of each other, the auto insurance company will often place these drivers in a higher risk category and charge higher rates.
Drivers Not Criminally At Fault in An Accident Don’t Have to Pay Their Deductibles
Drivers who have not been determined to be criminally at fault during a car collision believe that they will not be obligated to pay their deductibles, but this may not be the case. People can be found not to be criminally negligent but at the same time were the cause of the accident, so they will be required to pay their deductibles. If the other driver is eventually found to be the one who caused the accident, the driver not at fault will receive a refund.
An “Act of God” Is Not Covered
Policy holders are often confused about the wording, “act of God.” They often believe that damages caused by an act of God will not be paid by the car insurance company. The truth is that if a car is damaged by a particularly treacherous storm, these damages are covered by the car insurance policy. The confusion results because the words “act of God” are not present in the car insurance policy, so when people are reading over their policies to find out if damage caused by a flood is covered, they will need to look for the actual word “flood.”
Comparing Quotes Doesn’t Help Someone Under 25
Some people believe that seeking quotes from more than one car insurance company will not result in lower rates for people under the age of 25. This actually isn’t true either. People under age 25 can find a better deal just by seeking quotes from several companies. While one company may charge younger drivers more for their premiums, another may offer a break for a younger driver who has not had any accidents or tickets. The chance younger drivers have for finding lower rates is large enough to make comparing several quotes worthwhile.
The Employer’s Insurance Policy Covers the Employees
A very important myth that people must understand is a myth is that an employer’s car insurance policy covers the employees’ vehicles when they are in the process of performing their work duties. This myth is also untrue. Furthermore, when people are driving their vehicles for their jobs, they are not covered by their own personal car insurance policies. They would need to have a commercial auto insurance policy to be covered while they are in the process of making deliveries.
Ontario Car Insurance Myths
050 days
by admin
in Uncategorized
Some drivers believe some pretty amazing myths about their car insurance coverage. These stories get started through casual conversations where no one stops to validate certain statements that are made by well-meaning experts. Insurance companies are regulated very closely to make certain that drivers are insured against loss according to the written policy documentation provided from the insurer. Residents in Ontario can rest assured that the following myths have no basis in fact, and understanding this fact might make it easier to sleep at night.
- Car price – The actual price paid for the vehicle does not impact the premium charged by the insurance company. All insurance premiums are determined by the cost of parts and labour required to repair a vehicle. Very expensive vehicles will require higher premiums than common cars.
- Certain car colours – People who own red cars, or other bright colours, are not charged higher insurance premiums. The colour of the vehicle is not considered in the computation of insurance premiums.
- Owned, financed or leased – Regardless of the ownership agreement, the cost of insurance is not affected.
- Specific damage – Regardless of the extent of damage to the vehicle, the premium paid by the driver is not affected. Minor windshield cracks are viewed the same way a comprehensive claim is by the insurance company. Restoring the vehicle premium condition is within the terms of the insurance agreement.
- Driver fault – If the other driver is at fault, the insurance company will not increase the insurance premium. Even when the insurance company must pay to repair the vehicle, insurance rates will not increase when another driver is at fault.
- Unmade claims – A driver that does not file a claim following an accident, will incur a premium increase if the accident that caused the damage was the fault of the driver. Police reports are provided to insurance companies so the driver is identified and notes are made in the policy file.
- Traffic tickets – When a driver goes to court and the judge drops the point penalty, the ticket will still be reported on the driver’s record. Any moving violations remain on the record for three years from the court date. When the driver pays a fine, the insurance company will consider this act as an admission of offence.
- Police opinion of fault – Insurance companies will not always agree with the assignment of fault determined at the scene of the accident. When detailed police reports are provided, the insurance company can deny the claim and pursue a different determination. One standard example is when a car slides in poor weather and hits a stationary object. The police might not ticket the driver, but the insurance company will assign fault for the damage to the driver.
- Weather – Ontario drivers must realize that all accidents that involve one vehicle are considered the fault of the driver. An insurance company assigns responsibility for damage sustained by another person’s property to be the fault of the driver behind the wheel of the moving vehicle. When thousands of other drivers are able to reach their destination safely in the same storm, the insurer will assign fault to the driver that skids and hits a pole.
- Minor claims – The number of claims paid on a given policy will determine the impact on the premium charged when the policy is renewed. Minor claims against the policy will have the same impact as significant repair claims. If the car has been damaged in multiple incidents where the driver was not at fault for any of them, the premium charged by the insurance company might not increase very much in the new term.
- License class – When drivers take additional training to qualify for a Class B, F, D or A driver’s license, the insurance company does not adjust the premiums charged for insuring the vehicle. All insurance rates charged in Ontario are based on the G2 or G license class.
Every driver should verify the facts concerning their car insurance coverage to prevent bad decisions. Paying claims to repair the vehicle is part of the insurance company’s role when car insurance policies have been kept in force without any lapses in coverage. While some claims are denied because of extenuating circumstances, most legitimate claims are paid according to the terms stated in the policy documentation. Policy limits must be set at appropriate levels to prevent a situation where the car is underinsured. Wise drivers will conduct an annual car insurance review with their agent to verify the coverage and remove any old vehicles from the policy.