Car Insurance Canada

Car Insurance and the Law in Canada

In Canada, having a car insurance is required by law. Your car insurance is valid anywhere in Canada and the United States. It’s a good idea to keep your proof of car insurance with you whenever you drive because you must be able to show on request by a police officer. If you are found driving without valid auto insurance, you can have your driver’s licence suspended and your vehicle impounded.

The consequence of not having a car insurance when you are involve in a car accident is really severe. Not only you have to pay the damage on your car and the possible injuries you have. You will also face claims from other parties. This usually means a financial disaster for you.

Canadians are required by law to have third party liability insurance. This covers damages and liability in case you injure or kill someone or damage someone's property in a car accident. For instance, if you injured a pedestrian while running a red light, third-party liability coverage would pay the costs of the victim's injuries. If you damaged the victim's bicycle, it would pay for the bike's repair. How much liability insurance you require depends on the province where you live.

• Mandatory minimum liability insurance in Ontario, Alberta, Nova Scotia, New Brunswick, Prince Edward Island, British Columbia, Newfoundland, Northwest Territories and the Yukon, all provinces in Canada except Quebec, requires coverage for $200,000.
• In Quebec, the minimum liability requirement is $50,000.

How much liability insurance should I carry?

You should carry more than the mandatory liability car insurance. You should have enough insurance to cover your assets. With minimum coverage, you many not have enough money to cover damages awarded by a court for injuries you caused in an accident.

What kind of coverage is available?

In Canada a car insurance policy is required by law to cover third-person liability. The minimum amount of liability insurance needed depends on the province where you live. In Manitoba and Saskatchewan, it is also compulsory to have physical damage coverage, which covers damage incurred to your own vehicle.

The law does not require that you pay for car insurance to cover damages to your automobile. If you have a newer automobile, however, you'll want to protect your investment and consider purchasing Collision Coverage and Comprehensive Coverage.

 

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