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How is car insurance calculated?

An insurance company uses many factors when calculating auto premiums in Ontario and other provinces. Here are some of the key factors they use to qualify you :

1. Experience behind the wheel : Driving experience is a key factor. Experienced drivers are less likely to be in a collision compared to novice drivers. How long have you been driving? What level of graduated licence do you have?
2. Your age, gender, marital status : Insurers consider personal information such as your age, gender and marital status. Why? New drivers have less experience. Younger drivers, males, and single people are more likely to engage in risky driving. They are more likely to be a crash and get tickets. Studies show that women are less likely to be in accidents.
3. Driving record : A clean driving record can make a huge difference in how much you pay. Do you have recent tickets or claims? Accidents, traffic violations, and claims will increase your rates. The amount you pay will decrease when tickets are removed after 3 more years.
4. Vehicle you drive : What do you have – SUV or a sedan? How old is your car? Do you have a new vehicle? Is it an older car? Is it a common target for thieves? Does it have a good safety rating? The car you drive, its MSRP, features, repairs, and vehicle type can result in higher premiums.
5. How you drive and use your vehicle : Do you use your car to drive to work? How many kilometres do you drive per year? Do you use your car for work? If you drive occasionally, you may qualify for a low kilometre discount. Insurers consider the length of your daily commute, how you use your vehicle and how many kilometres you drive annually.
6. Where you live : Location, location, location. It can matter just as much for insurance as it does for real estate. An insurer will consider where you live. If your neighbourhood has higher statistics for car theft and crashes, your car insurance rates will reflect the higher risk. City, neighbourhood, and even postal code matter.
7. Coverage limits and deductible amounts : All policies must include the minimum amount of coverage required by law. In Ontario, the mandatory car insurance coverage is third-party liability, statutory accident benefits and uninsured automobile. All provinces have basic coverage requirements. You can then choose optional coverage for more protection. More protection will increase payments. It will also give you greater protection. Adjusting your deductible amount for collision insurance or comprehensive insurance will affect costs. As a general rule, increasing your deductible will lower your premiums.
8. Your claims and insurance history : Your insurance history as an insured driver matters. Gaps, payment issues, or too many at fault claims will impact your ability to be insured. It will also increase your payments. So, it is an important consideration to keep in mind.

Our car insurance calculator will help you find the lowest premium from the top providers based on all these items.

What cannot be used when calculating auto insurance in Ontario?

Here are the factors providers cannot use when calculating your premium :

• Not at-fault accidents
• Credit history
• Employment status
• Automobile status – own or lease
• Length of time at current residence

Getting an estimate with a car insurance calculator

Here is how to make the most out of using a calculator to get an accurate estimate :

• Know your needs : Have an idea of the type of coverage you need before you shop around.
• Compare apples to apples : It is important to shop and compare quotes for the same coverage from different providers.
• Don’t shop based on price alone : Cost is important, but not the only considerations. Make sure you understand the value, features, and services you will receive in exchange for your premiums.
• Talk to a broker : Our team can work with you to ensure you are getting the most savings and the best policy based on your driving needs.