1. Your driving record
A clean driving record translates into a lower premium. A driver with at-fault accidents represents a risk to the insurance company. And you’ll probably pay more if you have more than 1 ticket in the last 3 years for things like speeding or careless driving. How long you’ve had a driver’s licence (and whether you took a recognized driver's training course) can also affect your rate.
2. How much you drive – and where
If you live or drive in a city, you’ll likely pay more for insurance. That’s because cities have a higher incidence of car theft, and with more cars on the roads, accidents happen more often. On top of that, the more time you spend driving, the higher the risk of an accident.
3. Car make and model
Insurance companies have different insurance rates for different makes and models. They look at the chances of your car being stolen or damaged in an accident and how much it will cost to repair. If you’re looking for a car that’s less expensive to insure, check out the Insurance Bureau of Canada’s How Cars Measure Up. In general, rates are higher for newer vehicles and sports cars, but a car’s safety features can help lower the premium.
4. Your deductible
A deductible is the amount you pay in the event of a claim. The lower your deductible, the higher your premium. If you’ve made a lot of claims, your insurer may raise the deductible on your insurance.
5. Type and amount of coverage
In general, the more coverage you have (either standard or optional), the higher your premium. Most of the time, you can customize your policy to suit your needs. For example, you could add more third-party liability coverage or increase your deductible. You can also add or remove coverages like Collision or upset (protects you for damage to your vehicle regardless of who’s at fault) or Comprehensive (protects you against theft, vandalism, hail, or explosion).
How to save on your premium
- Shop around and compare to find the best coverage at the best rate. Compare quotes to make sure you're getting the best deal—just be sure to get quotes for the same coverage and deductibles.
- Ask your insurer about discounts. Some companies offer savings if you have an anti-theft system, winter tires, a good driving record, or if you insure multiple vehicles. You can also save by insuring your home and car with the same insurance company.
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5 factors that impact your car insurance rate
How do insurance companies determine your car insurance premium? Is there anything you can do to save on insurance? In general, the higher the risk and the cost to settle a claim, the higher your insurance premium. Let’s look at 5 factors that determine how much you pay for car insurance.
The Personal refers to The Personal General Insurance Inc. in Quebec and The Personal Insurance Company in all other provinces and territories.
The information and advice in this article are provided for informational purposes only. The Personal shall not be liable for any damages arising from any reliance upon such information or advice. The Personal recommends using caution and consulting an expert for comprehensive, expert advice.