It’s mandatory to have insurance if you’re driving a car in Canada no matter which province or territory you reside in. While each province handles insurance in a different way—in some province’s it’s government run, while in others it’s government regulated—the law remains the same: if you’re caught driving in Canada without auto insurance, you will be fined. If you’re in an accident, that fine is only the beginning of what is sure to be a costly affair.
Driving Without Insurance
The fines for driving without insurance vary greatly across the country. British Columbia’s fine is a little more modest with a minimum of $598. Alberta’s minimum is substantially higher at $2,875, with Ontario’s even more so: a minimum of $5,000 plus a mandatory 25 per cent victim fine surcharge, bringing the minimum fine to at least $6,250. Not to mention, driving without insurance can lead to license suspensions and vehicle impoundments, which come with their own costs.
If you get caught driving without insurance for a second time, then these fines increase exponentially.
The reason for this is simple. Cars are fast moving, heavy vehicles that have the potential to cause a lot of damage—to yourself and your property, and also to other people, their property, and the property around you. Insurance protects you and others on the road, and can prevent you from having to pay the heavy costs that can come with an accident.
Still, there are some Canadians who drive without insurance under the impression paying the fine is more practical than paying insurance. Not only is this illegal, but it’s a financial gamble that is certainly not worth the risk.
Average Accident Costs
The Insurance Research Council’s Auto Injury Insurance Claims Study found that in 2012, the average cost of an auto liability claim for property damage was $3,073, and the average cost for an auto liability claim for bodily injury was $14,653 (US). Even something as seemingly simple as a rear ending another car can range in cost from a couple hundred dollars to $10,000, depending on the extent of the damages. These are expenses your insurance company would typically cover, but without insurance you could be sued and found liable for the damages. This is on top of the cost of repairing or replacing your own vehicle.
Uninsured (and unlicensed) drivers are the most likely to flee the scene of an accident. Like driving without insurance, failing to remain at the scene of an accident (often called a "hit and run") is illegal and comes with serious consequences. You could be charged under your provincial highway act or you could be charged under the criminal code.
In Ontario, for example, drivers found guilty of fleeing the scene face incarceration for up to six months, risk losing their drivers licence for two years, and face fines ranging from $200 to $2,000—not to mention accumulating seven demerit points. Drivers found guilty under the criminal code face jail time of up to five years.
If the driver had auto insurance, they would likely face serious premium increases sometimes amounting to surcharges as much as 250 per cent on top of what the driver was already paying. In more severe cases, the insurance company could cancel the policy. However, if the driver didn’t have insurance to begin with, it will be very difficult for them to find a provider after the fact. And once they do, they can expect hefty premiums as these convictions will stay on their insurance record for at least three years.
All convictions go on a driver’s record, which means each insurer as well as other provinces have access to this information. For Ontario drivers, the States of New York and Michigan also have access to driver history due to a reciprocal agreement made between the province and those States.
Towing costs vary not just by province, but also by city. Some jurisdictions such as in Toronto, Ontario have bylaws in place to regulate the cost of rates for vehicle towing. If you’re in an accident on a Toronto highway, the towing fee will average $230, the maximum fee allowed, for the cost of the towing and the fees for one day of storage. This does not include taxes. In other cities, the price ranges. Many companies offer a base rate plus a cost for each kilometre driven, as well as additional storage fees.
Drivers who have purchased collision or all perils insurance will normally have this fee covered by their insurance even if they are at fault, but drivers without insurance will be left footing the bill.
Adding It Up
If you’re a Toronto-based driver and you get in accident you’re looking at costs averaging at least $25,000—and that’s if you stick around. If you flee, you’re not only facing additional fines, but you risk going to jail for months, if not years.
Accidents can happen to anyone, even good and safe drivers. Compare auto insurance quotes today to make sure you’re not only protected, but that you’re getting the best rate possible.