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Saving Money on Car Insurance

If you drive a vehicle in Ontario, you need to have car insurance. But don’t assume that all providers or policies are the same. By doing a bit of comparison shopping, or even just speaking with your current provider, you may be able to find a better rate.

If you are looking for ways that you might be able to save on car insurance, here are a few tips.

1. Be sure to price shop from an insurance broker.
An insurance broker will be able to shop your insurance portfolio amongst numerous insurance carriers and is not limited to just one company/offering.

2. Consider a higher deductible or the removal of physical damage coverage altogether.
Your deductible is the amount of money you would have to pay out of pocket to repair or replace your car before your insurance claim pays out. So, if your deductible is $500 and you had a claim for damages of $2000, you would pay $500 and your insurance company would be the remaining $1500.

By raising your deductible, you will have to pay more in the event of a claim, but it will also lower your insurance premiums.

As your vehicle ages, its value depreciates. At some point, the actual value of your vehicle will be less than (or close to) your deductible. When this happens, many consumers opt to remove their collision and/or comprehensive coverage altogether. When your vehicle reaches 10-12 years old, it is a good time to discuss your options with your insurance broker to determine your actual savings of removing physical damage coverage to your vehicle.

3. Ask about discounts.
Many insurance companies offer a variety of discounts that can help you save money on your car insurance. Some common discounts that may be offered include:
  • Group discounts – you may be eligible for a discount if you belong to a particular group such as a professional association, your employer, your union, alumni association, certain non-profits, etc.
  • Mature driver discount – for drivers over 50 years old who have a good driving record.
  • Multi-policy discount – you may be eligible for a discount if you have your car and home insurance with the same company.
  • Multi-vehicle discount – for insuring more than one car with the same company.
  • Renewal discount – some companies offer discounts if you maintain a good driving record for a certain number of years.
  • Winter tires discount
Be sure to ask your insurance provider what other discounts they may offer, since they may have additional discounts not listed here.

4. Choose an insurance carrier which monitors your driving behavior.
Many insurers have leveraged technology to enable consumers the ability to earn their own price by monitoring their driving behaviour. Some insurance companies offer customers up to a 30% discount when they install an app on their phone. This app will monitor safe driving variables like distracted driving, speed, hard braking, and time of day you drive. Once a significant amount of data is gathered, they will apply your discount.  

5. Notify your insurer of changes in your driving routine.
Are you driving your car less now because you have retired, are working from home, or got a job closer to your work? It’s important to let your insurer know about this, as you might be able to save some money on your car insurance.

6. Maintain a good driving record.
Driving violations and convictions will cause your car insurance premiums to go up. Make sure you always drive carefully and obey the rules of the road. Stay off your cell phone and never drink and drive.

7. Pay your premiums in full.
Most insurance companies charge a service fee to pay monthly. By paying your annual premium in full, you will avoid paying the monthly payment service fee. In addition, some insurance companies give significant discounts if you pay your premium in full.

8. Choose your vehicle wisely.
Insurance prices vary significantly between different vehicle makes and models.  Individual vehicle ratings depend on variables such as average cost of repair, safety and theft ratings. If your insurance price is a determining factor in your vehicle purchase decision, contact your insurance broker before your “sign on the dotted line,” they will run the price change for you.

If you would like to speak to an insurance broker about ways you might save money on your own car insurance, contact ICD Insurance Brokers today.