Which Drivers Are Choosing Higher Auto Insurance Deductibles?

By Liam Lahey
Smiling couple driving together.

Finding ways to try to save money on car insurance is almost a national sport in Canada. As drivers, we know the law requires us to have auto insurance. As car owners and people, we also know we need to have protection and coverage in the event we get into an accident.

As savvy consumers who aim to spend wisely and make smart financial decisions, there’s always a balancing act involved when purchasing car insurance: coverage versus cost. Opting for the cheapest car insurance policy you can find at the expense of having less coverage may not be the wisest choice to make. Is there a compromise to be found? Possibly.

Drivers trying to save money may wish to consider choosing higher deductibles on their coverages in exchange for a lower car insurance premium. There’s a trade-off to doing that, of course, but therein lies the challenge of finding the right balance between what you need and what you can afford to pay. If you’ve had the misfortune of having to file an auto insurance claim, you may regard things differently.

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The COVID-19 Question: How Will Your Driving Habits Shift?

Then there’s the matter of the COVID-19 pandemic to mull over. As the government lockdown slowly eases and society tiptoes toward “getting back to normal”, how eager will you be to take public transit versus driving to work?

During the lockdown, many Canadians are driving less and are receiving rebates or discounts on their auto premiums. As things inch back to how they were before the coronavirus crisis, your driving habits may change, leaving you with decisions to make about your auto coverage and deductibles. It’s an important decision, especially when car crash fatalities are on the rise. According to the Ontario Provincial Police (OPP), fatal collisions are up in 2020 compared to one year ago. The OPP says speeding and distracted driving are both largely to blame.

That led us to take a deep dive into how drivers in Ontario and Alberta across different age groups choose deductibles for their auto policies. Our data is based on the who shopped for rates through InsuranceHotline.com from January 2017 to December 2019. We looked at drivers who are claims-free as well as those who have filed at least one claim.

What Coverage Deductible Options Do Drivers Have?

Through InsuranceHotline.com’s free auto quoting tool, drivers have options when picking collision and comprehensive coverage deductibles. They can select no deductible (minimum), a $1,000 deductible and $1 million liability coverage (standard), a $500 deductible and $2 million liability coverage (enhanced), or customizable vehicle coverages.

What Deductibles Did Ontario Drivers Choose?

Number of Claims Year Minimum Standard Enhanced Custom
0 2017 14% 60% 6% 20%
1+ 2017 12% 57% 8% 23%
0 2018 13% 59% 7% 21%
1+ 2018 11% 55% 9% 24%
0 2019 12% 60% 7% 21%
1+ 2019 9% 56% 10% 24%
  • Regardless if they have filed claims or not, the majority of Ontario drivers (55% to 60%) tend to select standard coverage year-over-year.
  • A higher proportion of drivers with at least one claim are more inclined to opt for enhanced or custom coverages than drivers with no claims.

What Deductibles Did Different Generations of Ontario Drivers Choose?

Generation Number of Claims Minimum Standard Enhanced Custom
Baby Boomers 0 10% 49% 17% 23%
Baby Boomers 1+ 8% 48% 18% 26%
Gen X 0 10% 58% 8% 24%
Gen X 1+ 8% 55% 10% 27%
Older Gen Y 0 12% 62% 5% 21%
Older Gen Y 1+ 10% 60% 6% 24%
Young Gen Y 0 16% 64% 3% 17%
Young Gen Y 1+ 15% 61% 4% 20%
Gen Z 0 22% 60% 4% 14%
Gen Z 1+ 24% 53% 6% 17%
  • Whether they had filed claims or not, various generations of Ontarians mostly chose standard coverage year-over-year.
  • Drivers across generational divides with at least one claim were more likely to opt for enhanced or custom coverage versus claims-free drivers.
  • Baby boomers are more likely to choose enhanced coverage compared to other generations, with Gen Z the least likely to pick this option. On the flipside, Gen Z are more likely to choose minimum coverage compared to other generations, with Baby Boomers and Gen X least likely to pick this option.

What Deductibles Did Alberta Drivers Choose?

Number of Claims Year Minimum Standard Enhanced Custom
0 2017 18% 51% 9% 23%
1+ 2017 17% 49% 9% 26%
0 2018 19% 48% 9% 24%
1+ 2018 16% 50% 10% 24%
0 2019 14% 50% 11% 25%
1+ 2019 10% 50% 14% 26%
  • Like drivers in Ontario, Albertans tend to choose standardized coverages regardless of whether or not they have filed any claims.
  • A slightly higher proportion of drivers with at least one claim selected enhanced coverage than claims-free drivers.

What Deductibles Did Different Generations of Alberta Drivers Choose?

Generation Number of Claims Minimum Standard Enhanced Custom
Baby Boomers 0 14% 41% 19% 27%
Baby Boomers 1+ 11% 41% 19% 28%
Gen X 0 14% 49% 10% 27%
Gen X 1+ 12% 47% 12% 29%
Older Gen Y 0 16% 51% 7% 26%
Older Gen Y 1+ 13% 54% 8% 26%
Young Gen Y 0 22% 54% 6% 19%
Young Gen Y 1+ 23% 54% 5% 18%
Gen Z 0 31% 46% 7% 16%
Gen Z 1+ 32% 48% 4% 16%
  • Regardless of whether they filed a claim or not, the majority of Alberta drivers across all generations tend to select standard coverage year-over-year.
  • Whether they have filed a claim or not, Generation Z are more likely to choose minimum coverage than drivers in other age brackets.
  • Baby Boomers, Generation X, and Older Generation Y drivers in Alberta with at least one claim were more inclined to pick custom coverage.

Auto Insurance Deductibles: How Should You Decide?

When choosing your auto policy deductibles, there are a few things to keep in mind before deciding:

  • Can you skip getting collision coverage? Give it serious thought, since this type of coverage is what will pay for damages to your vehicle if you’re in an accident with another car, a streetlight, or any other stationary object. If, however, your vehicle is more than 10 years old, it may not be worth your while to buy collision coverage for it.
  • Do you have the funds to shell out for a high deductible? Consider your monthly budget. Are you sure you can comfortably afford to pay a $1,000 deductible after filing a claim if the need arises?
  • Customize your deductibles. Is a lower deductible for comprehensive coverage best for you since it tends to be a relatively inexpensive optional coverage to add to your policy?
  • What are the chances you may file a claim? You may be a cautious driver with an impeccable record, but that doesn’t mean you are impervious to being in a car accident. Think about how much you drive, where, and when – especially after the COVID-19 lockdown ends and your driving habits have changed.