Here's How Car Insurance Is Calculated in Ontario

There's little mystery in the cost of your Ontario auto insurance premium. You may get a different rate than your friend next door, but that's usually for good reason. Insurers in Ontario look at different factors to decide the level of risk you pose and the likelihood of your putting in a claim. If you represent a low risk, you get a lower premium. So, what exactly goes into that determination? It's about who you are, what you're driving, and where you live.

What's different about Ontario?

Each province has different rules about auto insurance. That's one reason premiums vary widely across the country. Ontario is one of the most expensive for car insurance premiums; it comes in second only after British Columbia. Part of the reason Ontario ranks so high in premiums is because is has high incidents of claim fraud. Insurers also handle a large number of lawsuits. Together, both of these realities contribute to the hefty overall costs that are passed on to the Ontario driver.

Find the Best Car Insurance Rates

Compare car insurance quotes from 50+ providers in a single search. Start saving money today on the premiums you pay.

How do insurers set Ontario's auto insurance premiums?

Typically, rates are set by a few factors, but it basically comes down to the following:

Each of these can make a big difference as to how much you pay. Here's a bit more information on each.

Where you live

Generally, more accidents and auto thefts happen in big cities. Urban dwellers will, therefore, pay more for car insurance. Back in January 2021, RATESDOTCA reported that Ontario's most expensive cities for car insurance were Brampton, Mississauga, Vaughan, Richmond Hill, Markham, and Toronto, in that order. While the average premium across the province is reported to be $1,616, in Brampton it's $2,698.

Your car

Insurers use something called CLEAR (Canadian Loss Experience Automobile Rating) to determine what make and model of vehicle pose the highest risk of claims. You can also reduce your premium cost by installing extra features, like anti-theft devices.

Your driving history

If you are a safe driver, you can get a lower premium. The number of years you have been driving and whether you have taken a driving course are both factors. Your premium goes up if you have past traffic violations and convictions for driving offences.

Your age and gender

Drivers under the age of 25 may find they have expensive premiums. Older drivers tend to have fewer accidents, so insurers give them a lower premium rate. In some cases, your gender or marital status may play a role in your rate.

How often you use the car

If you drive a lot, the chances rise that you will get into an accident. So, the number of kilometers you drive daily/annually is an important factor.

How to save money on car insurance

Despite Ontario's high costs, there are ways to save on your premium. Keeping a clean driving record and driving a safe vehicle can help. You can also choose a higher deductible and forego optional coverage. You can also compare insurance companies by searching online for car insurance at You'll be able to see for yourself how companies across the province add up.