This article talks about how tickets, claims, and non-payment cancellations affect your car insurance in Toronto.
Paying insurance on your car isn’t a simple, straightforward process. The payment is something that everyone can do easily, but it is the actual number crunching going on behind the scenes that introduces a lot of complexity.
There are numerous factors that are considered and weighed before a final amount is settled on for how much car insurance you are paying, and this means different people will have different payment rates. These considerations usually vary quite a bit in importance and frequency for different drivers. Today, we’re going to look at three major elements of consideration for your insurance that have a big impact on your rates.
The type of ticket you receive from Ontario law enforcement and the frequency at which you receive them may have an impact on your insurance. If it’s something minor, like parking tickets—which are not actually considered moving violations—this does not affect your insurance, though too many may affect your ability to get your license plate renewed.
On the other hand, violations that involve demerits have a big impact on your insurance rates. Speeding, and especially major convictions that are considered criminal offences, such as impaired driving, or getting a license suspension, ignoring that and driving anyway, then getting caught doing so, are big red flags.
In the simplest terms, any moving violation including those that add demerits to your driving record will affect your insurance rates. Anything that results in a bigger conviction, such as failing to report an accident you were involved in, or impaired driving will have much more serious consequences.
One thing all drivers should do is inform their insurance company of any accident they have, even if they ultimately decide not to make a claim for it. According to Toronto’s police website, if the combined damage of the involved vehicles is over $2,000, you must report the collision. Generally, In Ontario, if the damage to a car does not exceed $1000, there is no legal requirement to make an insurance claim, though you are still free to do this if you like. But we recommend you check with the police in your jurisdiction. In the GTA – Toronto area, you can check with one of the collision reporting centre offices (see above link on the Toronto Police website), or visit the accident support services website.
However, every time you make an insurance claim and you are at fault, this will affect the pricing of your insurance. The two biggest determining factors are severity and frequency. If you get into a very large accident, where you are at fault, the damage is considerable, and there may also be legal violations, such as impaired driving, this will have a big impact on your insurance. If it happens again in a short period of time and you make another claim, you can expect your rates to go up even more. The regularity with which claims occur will take their toll.
If you end up getting your car insurance cancelled due to an inability to pay the rates, this is a very large red flag for other insurance companies. It can actually be a significant stumbling block when you attempt to get insurance again, as this will be on record for other insurance companies to check, and they will want to know why the payments stopped and the insurance was cancelled.
Keep in mind that even in this situation, you may still be able to get new insurance, but complete honesty is critical. If you attempt to lie about the reasons why the insurance was cancelled and a later investigation uncovers your deception, you’ll be in even bigger trouble. Missing payments and a cancellation due to non-payment stay on your insurance record and could be there for years.
Ultimately, the core concept of tickets, claims and cancellations are simple. The more these pile up, the more you will pay. But the exact amounts depend on the nature of the incidents. Stay out of trouble, and your insurance will reflect this.