How to Get Cheaper Car Insurance in Canada

How to Get Cheaper Car Insurance in Canada

August 28, 2023

If you own a car in Canada, you will have to pay for its insurance. It's inevitable and a mandatory expense. But it's also for your own good, just in case some unfortunate event occurs, like theft, an accident, or a random tree falling over your car. While it is an unavoidable expense, you can try and get a lower insurance amount that won't make a dent in your wallet. 

In this blog, we will focus on ways to get cheaper car insurance in Canada. By following these measures, you can try and bring down the insurance costs.


Ten ways to get cheaper car insurance in Canada:


1. Select the right vehicle

Selecting the right vehicle can help you lower your insurance expenses. It's essential to factor in insurance costs when considering a car purchase and research insurance prices before finalizing your decision.

Insurance companies consider various factors when determining coverage costs for different cars and drivers. For example, cars commonly targeted by thieves, exotic sports cars, or rare models tend to have higher insurance premiums. 


2. Find an insurance plan that meets your needs

In Canada, there are four essential coverages that are typically required:

  • Third-party liability: Covers damage to someone else's property or injuries caused by you.
  • Accident benefits: Provides coverage for your injuries following an accident.
  • Uninsured auto: Protects you if an uninsured driver hits your vehicle.
  • Direct compensation property damage: Available in most provinces, this coverage ensures you deal solely with your insurer when settling a claim, and they handle compensation from the other party's insurer on your behalf, regardless of fault.


3. Bundle your insurance

You can save on individual payments by creating insurance bundles. This can be done in two ways.

Firstly, insuring multiple cars on the same policy can lead to savings on overall insurance payments. Bundling vehicles within the same policy benefits families or individuals with more than one car.

Secondly, combining various insurance types offers discounts as well. Many insurers provide savings when bundling car and home insurance under one policy. Some even extend this bundling option to other items like boats and jewelry for added benefits.


4. Maintain a good credit history

Positive credit standing plays a crucial role in your financial profile, influencing how insurers assess your risk. Maintaining a high credit score and a clean credit history can positively impact the quotes you receive for insurance rates. Therefore, it's advisable to review your credit report for accuracy and update it before seeking car insurance to ensure favorable terms.


Read: How to improve your credit score?


5. Opt for usage-based insurance

Monitor your driving habits and consider usage-based insurance (UBI), which can be especially beneficial for students and young drivers. UBI keeps track of various driving metrics, such as the number of kilometers driven, braking and acceleration patterns, speeding, and your handling of turns. You can monitor this system yourself through a mobile app. By demonstrating good driving behavior, you can earn discounts on your insurance.

Numerous auto insurance providers offer UBI programs, either through smartphone apps or by installing a device in your vehicle to track your driving performance beyond conventional statistics.


6. Practice safe driving and leverage safety features

Installing safety-enhancing elements can lower insurance premiums. Consider adding features like snow tires, upgraded anti-theft alarm systems, and collision avoidance technology, which could lead to reduced rates. Keep in mind that discount availability varies by province, so reach out to your insurer to learn about potential savings tied to these safety improvements.


7. Maintain a clean driving record

Maintaining a clean driving record is crucial. Incidents like traffic tickets, demerit points, and accidents can impact how insurance providers determine your coverage rates. Having multiple driving violations can lead to higher premiums, meaning you'll pay more than someone with a spotless record. On the flip side, a clean record often qualifies you for discounts with many public and private insurance providers, helping you save on your coverage.


8. Use anti-theft measures

While modern vehicles often come equipped with immobilizers, incorporating additional anti-theft devices, ranging from steering wheel locks to GPS trackers like Lojack, can potentially lead to reduced car insurance costs. Not only might you be eligible for discounts, but such measures can also prevent the need for comprehensive car insurance claims due to theft, which could otherwise result in increased rates.


Read: Top Safety Features to Look for in a Car


9. Enroll in a driving course

Completing an accredited driving course not only enhances your driving skills and safety but can also lead to discounts from insurance providers. Many insurance companies offer discounts to newly licensed drivers who have successfully completed an approved driver training course.


10. Consider raising your deductible

The deductible is the initial sum you're responsible for in a claim before the insurance provider covers the rest. Opting for higher deductibles can lead to reduced premiums. However, this also implies a larger out-of-pocket deductible payment in case of a car accident. However, this approach is not recommended for low-value vehicles. In the unfortunate event of an accident, paying deductibles higher than your car's value is not desirable.

The affordability of car insurance in Canada varies due to factors like location, driving history, age, and vehicle type, allowing you to find multiple options. Do your research and look for auto insurance providers that offer the best rates.