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Auto insurance laws are set at a provincial level, so Toronto’s insurance rules are the same as the rest of Ontario. Here are the three main things you need to know about how insurance works in the city:
1. All Toronto drivers must have auto insurance.
It is a legal requirement for drivers in Canada to obtain car insurance for their vehicle, and in Ontario, each policy must include third-party liability, statutory accident benefit, DCPD, and uninsured automobile insurance. Drivers can purchase additional coverage if they need more protection.
2. Toronto insurance operates under a no-fault system.
The name causes confusion but it is a simple system. No-fault insurance means drivers submit all claims to their own insurance company, regardless of who is at fault.
3. Toronto auto insurance operates under a private insurance model.
All Toronto drivers purchase insurance from private companies. You can purchase insurance from insurance brokers, insurance agents or the insurance providers themselves (known as direct writers). This competition is good for Toronto drivers, as it helps to keep premiums down.
|Royal & SunAlliance||$2245|
|Range of quotes $354|
|Royal & SunAlliance||$2318|
|Range of quotes $367|
|Royal & SunAlliance||$1870|
|Dominion of Canada||$2050|
|Range of quotes $334|
|Aviva Product (S&Y)||$1261|
|Range of quotes $314|
In Toronto, as with the rest of Canada, minivans and SUVs are generally cheaper to insure than smaller vehicles. Insurance companies look at repair costs, crash test ratings, and even the brightness of headlights when determining a vehicle’s insurance risk. Replacement cost is a factor too, so in this respect, older cars score quite well. However, the car you drive only comprises a portion of your insurance premium. Your driving history (number of tickets and at-fault accidents) have a much larger impact. A safe driver in a new sports car can still expect cheaper insurance than a dangerous driver in a modest SUV.
Every insurance company analyses driver risk slightly differently. The company willing to offer the lowest premium is different for everyone, and the cheapest company for you will change as your driver profile changes. This is why it pays to shop around. Compare quotes on InsuranceHotline.com to see multiple quotes side by side and find out if you could be getting a cheaper rate.
The average Toronto driver pays around $2,000 per year for car insurance, or $166.67 per month. This is 32.89% more expensive than the Ontario average of $1,505 per year, or $125.42 per month.
The exact amount you will have to pay depends on multiple factors, including where in Toronto you live. As indicated in a recent study, auto insurance premiums are highest in North York and Scarborough, while drivers who live in midtown and the downtown core enjoy more affordable rates.
The more likely you are to make a claim, the more an insurance company will charge for coverage. For Torontonians, the city is home to all kinds of factors that make claims more likely. Toronto contains some of the busiest roads in Canada (Highway 401 is the busiest in North America!), and with more cars on the road, your chances of being involved in a collision go up. On top of this, Toronto is a large city and the chance of your car being stolen, or broken in to, is higher than in less populated places. Finally, insurance fraud is a real problem in the GTA, with some unscrupulous drivers participating in staged auto collisions, or filing fraudulent claims to get unwarranted payouts. All of these factors combine to make Toronto one of the most expensive cities for car insurance in Ontario.
Car insurance is mandatory in Toronto and you must have valid insurance in order to operate a vehicle. If you get caught driving without insurance, the minimum punishment is a fine starting at $5,000. Many uninsured drivers immediately see their car impounded and licence suspended. Your future car insurance premiums will skyrocket too. To prevent this, always drive with car insurance.
There are optional endorsements and coverages you can add to your insurance policy, but every Toronto driver must have the following:
1. Third-party liability.
2. Direct Compensation Property Damage.
3. Statutory Accident Benefits.
4. Uninsured Automobile Coverage.
See our Ontario page for more information about mandatory auto insurance coverages in this province.
Every time you request a quote for car insurance, the insurer will ask a few questions to determine how much you should pay. Some of the factors that affect your rate in Toronto include:
Toronto’s insurance rates are decided by private insurers, who adjust their rates in response to the number and manner of claims they have been receiving. If there have been more collisions in your neighbourhood, you can expect your premiums to increase. In Ontario, rate changes are regulated by an independent body called the Financial Services Regulatory Body (FSRA).
Saving on car insurance is easier than you think. These 10 tips help ensure you’re getting the cheapest Toronto car insurance rate:
Your key to savings is finding the car insurance company that offers you the cheapest available rate. Busy families don't have time to call the plethora of Toronto car insurance companies to get comparative quotes. This is why getting instant online Toronto car insurance quotes saves you time and money.
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Very few things will drive up your auto insurance premiums faster than causing an accident. If you're living in the city of Toronto or frequently drive in it, you need to be aware of the local laws so you can avoid hurting yourself, others, your driving record and/or your insurance history.
Here are some things to be mindful of when driving in Toronto: