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New to Ontario? Things You Should Know About Auto Insurance

March 13, 2012

If you are new to Ontario, it’s important to understand how the insurance system in the province works. Especially if you are from a province that does not use a no-fault system, you might find things a little confusing. Fortunately, the insurance system in Ontario is quite straightforward once you understand how it all works. Get to know the basics about your new province and its auto insurance industry, and shopping for auto insurance will be much easier.

Auto Insurance Basics

As in all Canadian provinces, all drivers are required by law to carry a certain legal minimum in third-party liability coverage and accident benefits coverage. Above and beyond this required legal coverage, you can add a wide variety of optional coverages including comprehensive and collision. This is similar to other Canadian provinces, but there are some differences you should know about, especially those brought about by the 2010 auto insurance reform in the province.

The reform was intended to keep rates more stable and to allow drivers to customize their policies. You can choose from a standard coverage level, which is the legal minimum, or an upgraded coverage level. It also made some changes to how an at-fault accident affects car insurance rates. If you are found less than 25% at fault in an accident, it will not affect your premiums.

How No-Fault Insurance Works

Ontario is a no-fault insurance province. While this sounds to most people like it means no one will be found at fault in the event of an accident, it in fact means something very different. Whenever there is an auto accident there will be a determination of fault. In a no-fault system what differs is how the claim will be paid out.

In a traditional system, the insurance company of the driver who is found at fault will pay out on claims for both their own insured party and for the other party as well. Because their insured has been found to be at fault, that driver’s liability coverage kicks in to pay the claim. In a no-fault insurance system however, it does not matter who is found at fault – your own insurance company will pay your claim and the other driver’s insurance company will pay theirs.

If you are found at fault in an accident, you will still face an increase in your insurance premiums as a result. Ontario’s no fault system makes certain that claims are paid out quickly and without waiting for fault determination, allowing everyone to get straight to repairs on their vehicles.

Ontario’s Fault Determination Rules

In Ontario, a set of fault determination rules make the process of determining which driver is at fault in an accident simple and straightforward. These rules have been created in order to reduce the time involved in determining who is at fault and to prevent disagreements among insurance companies and drivers which can slow down the process.

The fault determination rules are applied to accidents in Ontario regardless of weather or road conditions, for which drivers are expected to adjust their driving to avoid accidents. This makes fault determination straightforward in most cases.

Fault can be assigned anywhere between 0 to 100% fault, so that fault can in fact be shared in a accident and in some cases shared equally. It is possible to appeal a fault determination, but the rules make these cases fewer.

The Private Insurance System

If you are coming from one of the provinces that use a public insurance system, you will find the private insurance system in Ontario very different. You are free to shop around for car insurance rates from a large number of insurance companies. Although there is a minimum requirement for your coverage set out by the government, beyond that you can pick and choose which options you want to add and how much you want to increase your coverage above the legal minimum.

A private insurance system means that you can shop around and compare rates to find the best deal on your policy. When you first arrive in Ontario, it’s good idea to obtain a variety of quotes so that you can get an idea of what the range of premium costs is across various insurance companies. Because insurance companies can determine their own rates, the difference from one company to another can often be a big one, which means you could be saving a lot of money if you take the time to shop around.

Ontario’s insurance system is designed to ensure that everyone has the coverage they need and that rates can remain affordable and competitive. New Ontario residents shopping around for car insurance sill quickly find that their options are many and varied, making it possible to find just the right policy at the right price.

  • Burton Buckler

    I would like to know why I am told I am at fault when the person I hit was charged with jay walking and the officer said I did not have a hope in heck of being able to avoid hitting him. I just don’t understand the way the system works it seems that no matter how carful you are they stick it to you.

  • Nick – InsuranceHotline.com

    Insurance adjusters follow the “fault determination rules” as outlined in the Insurance Act. If you feel that you should not be at fault for this accident discuss it in detail with your insurance professional for advice.

  • Ashleigh

    Does insurance cover the car or the driver?

  • Nick – InsuranceHotline.com

    Hello Ashleigh,

    When you buy an insurance policy you are buying insurance the car and the driver. The vehicle is covered for damage (if you have purchased the coverage) and the driver is covered for liability.

    Thank you.

  • owen

    what if you were not even there when the accident happened and the person reports you far away from the accident location with false info and the at fault ruling is applied to you ,,how do you fight that

  • Nick – InsuranceHotline.com

    Hello Owen,

    You will need to speak with your insurance company directly to discuss your specific situation.

    Thank you.

  • Sheila McKeown

    My sister was driving her car and another car side slammed her drivers door and she was hurt. How does the insurance work, does she still pay out her deductible to have her car repaired because of the no fault insurance?

  • Nick – InsuranceHotline.com

    Hello Sheila,

    That’s unfortunate. If the accident was deemed not her fault, she will not pay the deductible for damages to her car.

  • AJ

    In the province of Ontario can you insure a vehicle if the ownership is in someone else’s name?

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello AJ,

    No, you cannot insure a vehicle if the ownership is in someone else’s name as you have no insurable interest in the vehicle.

  • Juan Carlos

    In Ontario, can you register a car under your name without insuring it and have it off road until you can afford it?

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello Juan,

    You can, however, you may not be able to get a licence plate as you will need a sticker which require insurance.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hi Fidgefodge

    In Ontario the 25% at fault came into play in September 2010. See the attached from FSCO. http://fsco.gov.on.ca/en/auto/Documents/MoreChoice.pdf

  • http://www.insurancehotline.com/ InsuranceHotline.com

    In Ontario, there is no fault insurance. The other drivers policy will pay to repair his damage. He will not be charged a deductible as the coverage will be paid out under the policy section “direct compensation” not ‘Collision”

    thank you

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    You will have an at fault accident on your record which could affect your insurance premium for the next 6 years.

    Thank you

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    If they have the permission of the gas station owner to sit on their lot then it might be possible.

    Thank you

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    It is likely that the car loss will be paid out under the comprehensive section of her policy if she purchased that coverage.

    Thanks

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    No. you may not sue the driver of the other vehicle.

    Thanks

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Once you register your vehicle in Ontario you will have to obtain Ontario insurance.

    Thanks

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    Tickets stay on your driving record for 3 years from the date that you are convicted-not the date that you got the ticket. So if your son got the ticket in march and went to court in September, the ticket would stay on until 3 years from September.

    Thanks

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    Usually this time frame would be ok as long as it’s not permanent. Double check with your insurance company to be sure.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello

    If you were rear ended it is likely that the other driver is at fault.
    Who pays depends on the insurance law where you live.
    Check with your insurance agent or broker

  • http://www.insurancehotline.com/ InsuranceHotline.com

    hello

    Most of the time, in Ontario there doesn’t have to be a payout for an ‘at fault’ determination.

  • http://batman-news.com KL

    HI,
    I was driving my boyfriends car and a lady decided to slam on her brakes in front of me at a green light. I slammed on my brakes to avoid hitting her but i hit a bit of black ice and rear ended her. There was not a lot of damage but the lady didnt want to call the police so i gave her my informaion and my boyfriends insurance but she refused to give me hers. she did give me her number and iv been trying to get ahold of her as i would like to fix the damages which are very minor. Now she wants to go through insurance. since no cop was there no ticke or fine was laid. she reported the accident affter but shes lying im sure who is at fault and what would insurance do if no ticket was issued?

  • shahar

    I was involved in an accident, no tickets were issued to me due to the situation but I rear ended someone. I want to know how I can find out if I am under high risk driver category now and if I am how long does that remain on my record.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Each insurance company has their own rules for rating for accidents. Shop around to find the best rate for you.

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Regardless if the police officer gave you a ticket, even thought the driver stopped at a green light since you rear -ended the vehicle, you will likely be considered to be at fault.

  • shahar

    I know but I also want to know if I have to be insured for the 3-6 years I will be a high risk driver or can I wait tht period since I cant afford it and then get inaurance

  • ML

    We were involved in an minor accident while driving a rental car registered in Ontario. As we are European, I am not very familiar with Canadian insurance policies.

    We were leaving a gas station as another car drove into ours. We only had a tiny scratch, which the rental company is charging us an excessive amount of money for, but (of course) still less than the deductible on our insurance. We have already contested this amount with them, but if needed, can I contact the drivers insurance for a reimbursement of this amount since we were not at fault?

    Thanks.

  • Thor386

    Hi,

    I was in an accident, where weather conditions were the main factor in my breaks not working properly, and i was traveling down a hill, and in order to avoid hitting a stopped vehicle, which was waiting for a vehicle turning in front of it, my truck was sliding when i pressed the breaks, even for half a block. i avoided a full rear collision by releasing the breaks and steering off the road, unfortunately i clipped the van with the back part of my truck box. i was not charged by the police, due to weather conditions, but i want to know if “no fault” applies in this situation? or am i considered at fault?

  • Hola

    I rear ended a car in Ontario. There is no-damage to my car. What are my responsibilities regarding insurance?

  • Veronika Ribey

    If i am using someone els’s car insurance and i get speeding tickets, will it effect his inusrance?

  • http://www.insurancehotline.com/ InsuranceHotline.com

    no. The ticket will only affect you since it is tied to your drivers licence and not the licence plate of the owner of the vehicle.

  • Mike G

    your at fault because you are supposed to be in ‘care and control’ of your vehicle at all times. even in all weather conditions, apparently you were driving too fast for the road conditions to slide half a block (even down hill); or you were texting and noticed cars last minute… either or, your at fault!

  • Richard Yeung

    I live in Toronto, Ontario. Can I buy a car in B.C. and drive through West coast to East coast?

  • Gus Lakis

    Hi. My daughter , a new driver and is insured in my car scraped a parked car at the mall.
    No damage to my car but it appears that there might be $700 or more damage to the other car by the pics she took.
    She and the other owner exchanges info.
    How does no fault work in this situation?
    Thanks

  • InsuranceHotline

    “No fault” Insurance means that each party goes to their own insurance company to have their claim paid.

  • Gus Lakis

    What about fault. Does she have to report it anywhere? It happened on a mall parking lot.

  • Gus Lakis

    What about deducribkes

  • Gus Lakis

    What about deductibles

  • Mary from Calgary

    I was rearended in my limited edition 1993 Miata. Mazda’s 25th anniversary car. Two years from being a ‘classic’ in very good condition. They offered me 80% of book value . I am in Alberta. These cars are very rare. 200 sold in Canada. Saw one in parksville BC and two in US. Insurance says can’t use these cars to negotiate a higher price? Any suggestions as it is marked Salvage. ?? I want to keep it but they seem to want to come get it.

  • InsuranceHotline

    You can see if your insurance company will let you keep the salvage. You may get a bit less in your claims payout.

  • Tiffany

    I was driving a rental vehicle and I backed into another vehicle in a private parking garage. The insurance I purchased on the rental is covering the damage to the rental. If I understand correctly, the other vehicle owner must go through their own insurance to cover the damage on their vehicle. Will there be any fault towards me? Will this affect my own personal insurance at all? The rental car insurance assures me that it will not affect my insurance since the parking garage is private property and not subject to accident reports.

  • Ken

    since June 1st 2016 Ontario motor vehicle insurance states that a minor accident, no injury’s damage less that $2,000.00 with no payment paid out by the insurer can not be used to increase your premiums. Do these new rulings apply to motorcycle policy’s ??

  • Red

    I’m in the same position as Jodie. Your answer is not very illuminating as now the question is when does one need to register their vehicle in Ontario after moving to Ontario.

  • InsuranceHotline

    here is some information on registering a vehicle in ontario from the MTO website https://www.ontario.ca/faq/what-do-i-need-register-out-province-vehicle-ontario
    if you are becoming a permanent resident of Ontario you should have your vehicle registered and insured here.

  • Red

    I know we have to register and insure our car here when we renew, but my question is how long will my Manitoban insurance still be valid. Manitoba rates are lower than Ontario rates, so as long as my Manitoba insurance covers us, I am in no hurry. So my question is: how long can I continue to use our Manitoba insurance after we have moved here?

  • InsuranceHotline

    Most insurance companies require that they be notified if the vehicle will be out of the province for more than six months.
    If you do not let your insurance company know that you are out of province permanently you could violate your coverage.

  • Yan Ding

    I rented a car from Enterprise in Ontario, used my credit card for the insurance and declined all the insurance provided by the car renal company. However, I hit a parked car in a parking lot and scratched the paint of both cars. The rental car I was driving was covered by my credit card insurance, and that’s easy to claim.

    But who is going to pay for the repair fee of the other car? I contacted Enterprise, they say that although all their cars are insured by third party liability for all the drivers over 25 included in the base rate, in this case, the liability doesn’t cover the other car. I am wondering if this is correct or I miss something? To my knowledge, liability pays the lost to the third party due to your fault. Thanks a lot!

    Yan

  • InsuranceHotline

    In Ontario, damage to a vehicle is paid for by the vehicle owner’s insurance (no fault insurance). So in your case, the owner of the vehicle that you damaged will contact his insurance company to make a claim for the repairs.

  • Roberto Diego H

    I was hit by a G2 driver. He ran a red light…..and bam…there goes the front of my car. I did everything correctly, called my insurance agency, the police and filed a report. Today I was informed that my car is irreparable so they will be doing my assessment. Thing is with the no fault, your insurance company is going to low ball you and there is no course of action. Also my car is just a little over a year so I have $30,000 left to pay….the black book price for the car is now $14,000 – $17,000 which will leave me $13,000 – $15,000 STILL owing on a car that is totalled by an accident I did not cause. So if I have an issue with the auto dealership not swallowing the rest of my loan and put it towards a new one….I will have to sue this kid (he was on his father’s insurance) and take it to court. It makes no sense that I have to pay for a car that was damaged by someone else. Welcome to no fault Ontario

  • Linda

    In Ontario if I’m rear ended (was not my fault)and suffered injuries who pays pain and suffering damages my insurance or the other persons
    This no fault insurance stuff has me so confused
    Thank you

  • InsuranceHotline

    In Ontario your insurance company will pay the claim. As for pain and suffering damages, Ontario personal injury law has a ” threshold” when it comes to pain and suffering. This threshold must be met in order to receive ANY compensation for pain and suffering. The Ontario Insurance Act states that a person is only entitled to general damages if they have sustained a serious and permanent disfigurement, or a serious and permanent impairment of an important physical, psychological or mental function. What is a permanent and serious impairment? Ontario courts have defined a permanent and serious impairment as an impairment that negatively affects a person’s daily living .

  • InsuranceHotline

    In Ontario if there is no payout by either of the driver’s insurance company then you should not see an increase in your premium.

  • SRFGal

    What are my options for my daughter who doesn’t own a car but has her license. She is attending university. My husband and I each have a car and insurance. Should she have an insurance even though she doesn’t have a car?

  • InsuranceHotline

    If she drives your vehicles on a regular basis, she should be added to either your husbands or your policy. If she’s away at school for a big part of the year, let your insurance company know. They may have a discount for that.

  • luke7478

    I find it odd that you are ONE HUNDRED PERCENT at fault and you have the audacity to lay blame elsewhere!! You were tailgaiting the other person and should have been issued a ticket as well for “following too closely”.

    Simply because there is a green light, does not mean that the other driver must simply proceed without caution. Any number of things could have happened, like someone stepping out suddenly in front of her car etc. It is YOUR responsibility to keep a safe following distance. You should thank your lucky stars that the other driver did not call the police. You would have gotten a ticket as well on the spot. I know, if I were the cop I would have given you the highest fine possible.

    This is EXACTLY why I have installed high definition cameras both in the front and back of my vehicle (to clearly capture the license plates of tailgaters). Although I don’t live in a “no fault” state (California).