The Financial Services Commission of Ontario (FSCO) released key changes to reporting minor car accidents in 2016.
“Insurers can no longer use a minor at-fault accident that occurs on or after June 1, 2016 meeting certain criteria to increase your premiums. The criteria include that no payment has been made by any insurer, that there are no injuries, and that damages to each car and property were less than $2,000 per car and were paid by the at-fault driver. This provision is limited to one minor accident every three years.”
Here are seven things you need to consider when deciding to submit your car insurance claim or pay for the damages yourself.
1. Reporting the Accident
After an Accident
You don’t need to report accidents to the police if the total damage to all vehicles is below $2,000 in Ontario, as long as there are no injuries, no property damages, and no suspicions of impaired driving or illegal activities.
However, you should always notify your insurance company of any damage or accidents involving your car. If you don’t and your insurance company finds out, they could cancel your policy. If your damage is under the FSCO $2,000 threshold, you don’t have to file a claim. If you are thinking of filing a claim, make sure you take into account what your rate increase will be. Remember, your rate increase will last six years.
Hit and Run Driver
If your car was involved in an accident with a hit and run driver (including being hit while your vehicle is parked), you will have to pay the deductible to your insurance company, but your rates won’t increase. A police report will be required for this to be considered a not at fault accident. Most insurance companies require that you notify police within 24 hours before considering it to be a hit and run.
Reporting Your Accident to The Collision Reporting Centre
The collision reporting centre has a service where you can report your accident to your insurance company. The collision reporting centre will provide you with a record for your notes.
Reporting Your Accident to The Insurance Company
If you are planning on making a claim, you need to report your accident to the insurance company if the damage exceeds $2,000 for both cars, which can happen more easily than you think…
If you don’t notify your insurance company of an accident whether you are at-fault or not, and the other party claims through insurance, your insurer will hear about it.
2. Determining Fault
Fault Determination Rules
Ontario auto insurance companies use the Fault Determination Rules to determine who is at-fault in an accident. If you are considered to be at-fault the accident can stay on your driving record for six years and may increase your rate.
When reporting an accident, police determine if there has been a violation of the law. Your insurance company will still determine the fault and ultimately if your insurance rates will increase. Even if the police determine an accident was not your fault, you can still be surprised by your insurance company finding otherwise.
Insurance Policy Wordings
If you are ever confused about insurance policy wordings, speak to your broker to clarify what is included in your policy.
3. Seeking Help
A Second Opinion
If you question the finding of your at-fault determination, you can always seek a second opinion from legal counsel.
Insurance Experts Who Can Help
The General insurance Ombudservice (GIO) is an organization set up to impartially mediate between insurance companies and drivers with respect to the "Fault Determination Rules". In other words, if you have a disagreement with your insurance company that you can't sort out on your own, you aren’t out of luck. The GIO will help you resolve your dispute. The GIO’s service are free of charge and available in French and English from anywhere in Canada.
Contact the GIO:
Telephone Number: 1 877 225-0446
4. Your Rate
Your Insurance Rate
A driver with an at-fault accident can see their insurance rate jump from as much as 30 percent and remain high for 6 years. If a driver has another at-fault accident during this time period, they may be considered a high-risk driver.
Insurance companies factor in a lot of details when generating rates for drivers. Rates may vary slightly for type of vehicle or location but there are vast differences between drivers with a clean record and those with accidents.
After an accident, take the increase in rate your insurance company quoted you and multiply that number by six — the number of years your premiums will increase for — to see how much your accident will really cost you.
If the cost to repair your damage is only $1,000 you might be best to fix it out of pocket. If you will see an increase of $500 per year for 6 years you would be paying $3,000 for the damages through insurance.
If you choose to submit your claim through insurance, switching insurers upon renewal of a policy may not help you lesson the amount you’ll pay through your current company for those same damages. Each driver’s profile is different so be sure to get quotes to see if you can save money by switching your coverage to a new insurance company.
Calculate Your Rate
Plug your details into InsuranceHotline.com, including your accident, to compare rates from over 30 top insurance providers. Compare your current rate to your new quote.
Compare rates for the six years following your accident to see if you can save money. You should be able to find an insurer with a lower rate as your accident gets “older”.
5. Paying Out of Pocket
Weighing the Damage
Choosing to pay your own claim if the damage is below $2,000 can save you money in the long run, especially if your deductible is on the high-end. If you choose to pay for your own damage your insurance premium won’t increase.
Insurance companies have preferred repair shops, but the decision to have your car repaired wherever you like is up to you. The Insurance Bureau of Canada (IBC) suggests that the preferred-shop program helps control claim costs, and ensures repairs meet high standards.
The insurance company will deal directly with the preferred shop on your behalf and guarantee the work is done properly.
The IBC notes, “If you choose a shop that’s not in your insurance company’s preferred shop program, you will be responsible for managing the repair. Be aware that the insurer will not pay more than the price that its repairer quoted.”
6. Filing a Claim
If you have had a prior accident within the last six years, or tickets in the past three years, your insurance company could cancel your policy. A combination of wrongdoings could designate you a high-risk driver. You should ask with your insurance broker about cancellation conditions that may be in your policy before submitting a claim.
To see how many tickets you have on your record you will need to order your driver’s abstract from ServiceOntario. Insurance companies can increase your rate for three years from the date of conviction for a ticket.
Tickets insurance companies charge for range from minor to serious and can have more repercussions than a simple fine.
Auto History Claims Report
An auto history report (Autoplus) is free from CGI and will list all prior claims history since you received your driver’s licence. It is important to see what claims you may have already submitted through any insurance company.
Accident Forgiveness Coverage
If you have a good driving record you may qualify for accident forgiveness coverage. For an additional cost, the coverage can wipe away the effects of an at-fault accident on a driver’s first offence. Typically, the “claims free” time won’t transfer to a new company if you switch insurance providers though and the accident will still appear on your driving record.
7. Comparing Rates
Compare insurance rates at InsuranceHotline.com to see how much you can save after an “old” accident or if your good driving record qualifies for accident forgiveness coverage.
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