How Do Demerit Points Affect Auto Insurance?

Police car pulls over motorist in Canada.

Whether shopping or playing a sport, we all love to collect points. But there are some points you do not want to rack up: demerit points.

Think of demerit points as penalties. They are designed to encourage safe driving behaviour by holding drivers responsible for their actions on the road. All drivers start with zero demerit points. They are added to your driving record if you are convicted of violating specific traffic laws. Demerit points are used by provincial governments to determine whether or not your driver’s licence should be revoked.

Although they remain on your driving record for two years, demerit points do not affect your car insurance premium directly. However, the number of tickets you have and the severity of those tickets certainly do.

How Demerit Points Work in Ontario

The number of demerit points added to your record depends on the type of conviction. For example, according to the Highway Traffic Act, seven demerit points are added to your record if you are convicted of failing to remain at the scene of a collision, or if you don’t pull over when a police officer signals you to do so.

While the penalties associated with demerit points vary by the type of licence you have, in general, if you gain 15 or more demerit points, you face a one-month suspension. You will also have to surrender your driver’s licence.

If you think you may have demerit point and traffic-related convictions on your driving record, it may be worthwhile to check your driver’s record to find out.

How Demerit Points Work in Alberta

Like Ontario, Alberta also uses a demerit points system for penalizing drivers. According to Alberta’s Traffic Safety Act, a fully licensed driver will have their licence suspended if they accumulate 15 demerit points. Demerit points are applied to a driver’s licence upon conviction for the related offence and remain on your driving record or abstract for two years.

Alberta also offers drivers with demerit points on their records the opportunity to earn merit credits as a way to reduce the demerit points. By participating in a defensive driving or professional driver improvement course, a fully licensed or novice driver can get up to three demerit points removed from their record.

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How Demerit Points Affect Your Car Insurance

If you are convicted of a traffic violation that includes demerit points, they are immediately added to your licence.

Insurance companies don’t base your premium on the number of demerit points you accumulate, but they do consider the number and severity of the tickets you have. However, if your licence is suspended as a result of having too many demerit points, that could increase your premium.

As a general rule, the more tickets you have, the more likely your insurance rate will rise. If you accumulate too many tickets, you may find yourself facing a non-renewal from your insurance company. That means that the insurance company has determined you are too great a risk for them to insure, and you may need to go to a high-risk car insurance company instead.

Some insurance companies may count a traffic violation against you for up to three years, and the charge goes from renewal date to renewal date, not from the date of conviction.

How Demerit Points Affect Novice Drivers

Demerit points can have even more severe consequences for novice or new drivers enrolled in graduated licensing programs that could diminish your chances of qualifying for a full licence.

In Ontario, novice drivers with G1, G2, M1, M2, M1-L or M2-L licences who earn six to eight demerit points may see their licence suspended. Furthermore, you will need to attend an interview (which will cost you $50) with a Ministry of Transportation official to explain why your licence should not be suspended. As a new driver, if you accumulate nine or more demerit points, your licence is automatically suspended for 60 days, and you must surrender it at any ServiceOntario centre or by mailing it to the Ministry of Transportation. If you don’t, you face a two-year suspension.

But the punishment doesn’t stop there for novice drivers who continue to amass demerit points. New drivers may also face escalating penalties for breaking certain laws such as flouting graduated licensing rules. A first offence will see your driver’s licence suspended for 30 days. A second offence for 90 days. A third offence and you lose your novice licence and will need to begin the graduated licensing program anew.

Out-of-Province Demerit Points

Also noteworthy, out-of-province demerit points will follow you. For example, Ontario drivers who are convicted of a traffic violation that includes demerit points in the states of New York or Michigan will see them show up on their licence. Likewise, if you gain demerit points in other provinces, those will also be attached to your driving record. Of course, that too will affect your auto insurance premium.

It’s safe to say it’s in your best interest to avoid getting demerit points by adhering to safe-driving habits and avoid being charged with traffic violations altogether.