Guide to Car Insurance for Families: Choosing Your Policy and Making Claims

Road safety goes beyond what’s in your car and extends to the type of car insurance you buy. Buying the right plan and coverage helps to protect your family in the event of the unexpected and gets you back on the road faster.

Car insurance offers financial protection for you and your family or dependents in the event of an auto accident. It’s mandatory for all drivers in Canada and can help cover the costs of injuries to yourself and others, as well as auto repairs, theft and more. But just like no two families are the same, no car insurance policy or insurance company is alike. Here are some things to look for when shopping for a family car insurance policy in Canada.

Understanding Car Insurance

With car insurance, you pay a monthly or annual fee (called a premium) to cover yourself or other drivers in your household. If you have an accident, the insurance covers the cost of repairs to your car and any damages you may be liable for and could pay out money to you or your family in the event of injuries or deaths.

Car insurance policies provide coverage for:

• Personal injury or death: Receive a financial settlement if you or your family are injured or die in a covered car accident.
• Injury or death of others: Liability insurance covers costs if one of your passengers or another driver is injured or killed in an accident where you’re at fault.
• Uninsured or unidentified drivers: Your insurance may also cover you if you’re involved in an accident with someone who doesn’t have insurance or with an unknown driver, like in the event of a hit-and-run.

When choosing a policy, some parts of it will include mandatory coverage (this varies for every province or territory), and there will be additional optional coverages that you can also buy. Usually, coverage falls into a few categories:

• Liability and other mandatory insurance coverages
• Comprehensive Car Insurance and Collision Damage
• Optional Car Insurance, also known as endorsements (or riders)

How much does car insurance cost for families in Canada?

Car insurance prices depend on many things, including:

• Location: Insurance prices vary by province, city and region.
• Driving history: Experienced drivers tend to pay less. New or young drivers, people on graduated licensing programs (depending on your province), and people with a driving record that includes accidents or traffic convictions (like speeding tickets) usually pay more.
• Driving habits: Do you drive only on weekends, to and from work, or is your personal vehicle used for work purposes? The different ways you use your car can impact your insurance price.

How to choose a car insurance policy for your family

Think about your family’s driving needs

Maybe you all share your parents’ car for work, school and grocery runs. Or maybe you have multiple cars and a recreational vehicle, like a motorhome and require motorhome insurance. It’s useful to talk to an insurance advisor about what your family needs.

Some important factors you should be aware of:

• Multi-vehicle households: You could save by insuring multiple cars under the same car insurance policy rather than taking out separate insurance policies.
• The number of drivers (or soon-to-be drivers): Young drivers can gain experience by being “secondary” or “occasional” drivers on their parents’ car insurance policies, even if they’re away at college or university.
• Budget: Some insurance policies go beyond the basics and may cost more than others. Look at the coverage you need and how much you can afford. There are ways to customize your insurance policy and price. For example, to save on the price you pay monthly or annually, you could select a higher deductible, which is the amount you have to pay if you make a claim. You’ll pay more if you make an insurance claim, but you’ll get a lower cost upfront.

Comparison shopping for car insurance

Shopping around can help you save money, as well as give you a better idea of features available with different companies.

• Get quotes from multiple insurers: Doing your research can help you find the policy that works best for your family. An insurance advisor can answer questions and help you understand what types of insurance would meet your family’s needs and what prices to expect.
• Compare coverage options: Compare what’s covered with each plan and the different options. There are additional coverages that you can buy to help you save money in the event of a claim, like forgiveness for your first at-fault accident.
• Get advice from a licensed insurance advisor: They can review the policy with you so that you understand the terms of your plan. They can also explain any situations where you may not be covered or require additional coverage.
• Ask about discounts: Some insurance companies offer special pricing for bundling home and auto insurance together, as well as discounts if you drive an electric or hybrid vehicle¹ or belong to an eligible professional association or organization, like an employee group or union.

How to purchase car insurance in Canada

There are several ways to buy car insurance in Canada, including:

• Directly from an insurance company where licensed advisors can guide you through the process and give you helpful advice
• Get a quote and buy car insurance online
• Insurance brokers can help you shop around for different plans and get you prices from multiple insurance companies

Maintaining your car insurance policy

It’s important to be proactive about paying your bills and keeping your information up to date to ensure your insurance coverage stays active and your family is protected.

Be sure to:

• Pay premiums on time to avoid extra fees: Set up automatic payments and check that your monthly payments have gone through, or ask your insurance company about making annual payments and when they send reminders.
• Keep your information updated: Update your personal information as it changes, like adding or removing drivers from your policy and updating your address and credit card number and expiry date.
• Renew your policy on time: Make sure you’re prepared for when your policy is up for renewal, and take the time to speak to an insurance advisor about your options in advance. There may be ways you can save money; for example, if your needs or situation has changed or if there are options for bundling insurance.

Making a car insurance claim

Steps to take after an accident

No one plans to get in a car accident, but if it does happen, here are the steps you need to take:

• Stop and pull over when and where it is safe to do so
• Check for injuries (yourself and if other parties are involved). Call 911 if required
• Contact the police immediately
• Exchange information with the other driver, including:
  • Name, address and phone number
  • Driver’s license number
  • Car make and model and license plate
  • Insurance company name, phone number and the policy number
• Take photos of the damage to both cars

Filing a claim with your insurance company

If you’re involved in an accident:

• Report the accident to your insurance company right away
• Keep any documentation you have from the car accident
• Submit any requested documentation and receipts to your insurance company

Having the right car insurance policy can protect you and your family from the financial impacts of a car accident. Be sure to update your plan as your family’s situation changes. This can help ensure your loved ones have the coverage they need and get them back on the road faster.

Interested in learning more about car insurance? Read your policy carefully. Be sure to check your policy every year to ensure that all your information is accurate and current. Ask questions in case there are discounts your insurance company offers that you qualify for.

^{1. Electric vehicle and hybrid vehicle discounts can vary based on the province or territory where the customer lives.}