Not all automobile polices are created equal. While they do share a standard basic form in Ontario, the limits, additional coverages and deductibles can make all the difference when a claim occurs.
Let’s break down the main parts of an automobile insurance policy.
Third Party Liability
|Protects you if someone else is killed or injured, or their property is damaged. It will pay for claims as a result of lawsuits against you up to the limit of your coverage, and will pay the costs of settling the claims. By law you must carry a minimum of $200,000 in Third-Party Liability coverage but options exist to increase the minimum amount.
Statutory Accident Benefits
|Provides you with benefits if you are injured in an automobile accident, regardless of who caused the accident, including supplementary medical, rehabilitation and attendant care, caregiver, non-earner and income replacement benefits. Options exist to increase most of these coverages.
Direct Compensation – Property Damage
|Covers damage to your vehicle or its contents, and for loss of use of your vehicle or its contents, if another person was at fault for the accident. It is called direct compensation because even though someone else causes the damage, you collect directly from your own insurer.
Extra Coverage for Loss or Damage to Your Vehicle
||Pays for losses, other than those covered by Collision or Upset, including perils listed under Specified Perils, falling or flying objects, missiles and vandalism.
|Collision or Upset
||Pays for losses caused when an insured vehicle is involved in a collision with another object, including another vehicle, or rolls over. “Object” includes: another vehicle or a trailer that is attached to the vehicle that is covered by your insurance policy; the surface of the ground, and any object in or on the ground.
||Combines Collision or Upset and Comprehensive coverages. In addition, it covers loss or damage caused if a person who lives in your home steals the vehicle that is covered by your insurance policy. All Perils also covers you if an employee who drives or uses, services or repairs that vehicle, steals it. For example, if you take your vehicle to a garage for repairs and an employee involved in the repair of your vehicle steals it, All Perils would cover you.
||Pays for losses caused by one of the following perils: fire; theft or attempted theft; lightning, windstorm, hail, or rising water; earthquake; explosion; riot or civil disturbance; falling or forced landing of an aircraft or parts of an aircraft; or the stranding, sinking, burning, derailment or collision of any kind of transport in, or upon which an insured vehicle is being carried on land or water.
Most Common Additional Endorsements*
|Accident Forgiveness (Claims Protection)
||Protects your driving record with your current insurance company in the case where you are found to be at fault in a claim.
|Transportation Replacement (OPCF 20)
||Often referred to as “Loss of use”, covers the cost of a rental vehicle while your vehicle is being replaced or repaired, if the damage or loss is caused by a peril for which you are insured.
|Liability for Damage to Non-Owned Automobile (OPCF 27)
||Provides physical damage coverage to vehicles that you may operate but do not personally own – such as a vehicle that you have rented or borrowed – subject to a deductible. It also provides Liability, Accident Benefits, Uninsured Automobile and Direct Compensation-Property Damage coverages in specific circumstances.
|Removing Depreciation Deduction (OPCF 43)
||Removes the insurer’s right to deduct depreciation from the value of your vehicle when settling a claim for loss or damage caused by a peril for which you are insured.
|Family Protection Coverage (OPCF 44)
||Protects you, or an eligible member of your family, to the same limits as your Third-Party Liability coverage if you are involved in an automobile accident where you are not at fault, with someone who carries less insurance, no insurance, or is an unidentified driver (e.g., hit and run).
|Added Coverage to Offset Tort Deductible (OPCF 48)
||Reduces the deductible associated with court awarded compensation for pain and suffering by $10,000 for non-Family Law Act claims and by $5,000.00 for Family Law Act claims.
*Please keep in mind that these are only some of the many policy endorsements available for purchase. Ask one of our qualified brokers which policy endorsements would benefit you.
As with every insurance policy, there are also certain exclusions that apply to the availability of coverage.
Exclusions in Standard Auto Policy
- Mechanical failure or breakdown, rusting, wear and tear, freezing or explosion within the engine and damage to tires, are not covered unless they result from an insured peril (such as a collision).
- Your insurance company is allowed to deny payment for loss or damage caused to the vehicle in an accident, if you or anyone you let drive your vehicle:
- was unable to maintain proper control of the vehicle because you (or he and she) was driving under the influence of alcohol or drugs; or
- is convicted of one of the following Criminal Code offences (or any similar offences under any other law in Canada or the United States) relating to the use, care, or control of the vehicle:
- causing death or injury by criminal negligence,
- dangerous operation of a vehicle,
- failure to stop at the scene of an accident,
- driving a vehicle when impaired or with more than 80 mg of alcohol in the blood,
- refusal to provide the police with a breath sample,
- causing injury when driving a vehicle while impaired or with over 80 mg/100ml of alcohol in the blood, or
- driving the vehicle while disqualified from doing so.
Except for certain accident benefits, there is no coverage for anyone, including passengers, if:
- Your vehicle is driven by a person without your consent, or by someone specifically excluded from your policy by the OPCF 28A (Excluded Driver Endorsement).
- The vehicle is used to carry explosives or radioactive materials.
- The vehicle is used as a taxicab, bus, or sightseeing vehicle, or to carry paying passengers such as with a ride-sharing service.
- If you are intending to participate in a ride-sharing service as a driver, you should check with your auto insurance representative to ensure you have proper insurance that protects the driver, passenger and others.
It’s hard to choose the right insurance that fits your budget and needs, and having various levels of coverage is important. Get the proper protection at a price you can afford. Protect yourself in the event of an accident, theft, liability or property damage. Get customized coverage that fits your lifestyle.