APPLYING FOR AUTO INSURANCE
What should I know about a lapse in insurance coverage?
A lapse in insurance coverage will not be held against you unless:
• your policy was cancelled for non-payment of premium;
• your driver's licence was suspended because of a conviction related to the use or
operation of the automobile, e.g., impaired driving; and/or
• an accident or conviction happened that would result in higher premiums and you did not
notify the insurance company – for example, if you had an accident that destroyed your
vehicle and did not tell your company.
When you want insurance coverage at a later date, you need to prove you had prior insurance.
Advise your insurance representative if you are going to cancel your policy or have a lapse in
insurance because:
• you’ve sold your car and do not plan to replace it for a while;
• you are moving out of the country temporarily; or
• you are going to drive a company car and don't need your own vehicle.
Get a letter from your insurance representative outlining your policy number, insurance company,
how long you were insured and your accident and conviction history. Keep this in a safe place.
Or, you can write down the reason for lapse in insurance and make two copies. Give one to the
insurance representative and have him or her sign the other copy for your records. This provides
you with documentation when you need insurance again, in case that broker/agent is no longer
available to verify your lapse in coverage. Also keep a copy of your latest policy.
What coverage is mandatory and what coverage is optional?
Automobile insurance in Ontario is required by law. You must not drive without it.
While the law calls for standard policy wordings and oversees the range of options, there are
many insurers competing on price and service in the Ontario market. Brokers and agents can tell
you which insurers they represent and which companies they get quotes from, and show you
those prices on request.
Retirees: Insurers must offer a premium discount on accident benefits coverage to retirees aged
65 or older, and also to younger retirees if they are receiving a Canada or Quebec Pension or a
Ontario Auto Insurance: FAQs 5
pension registered under the Income Tax Act. For complete details, talk to your insurance
representative. You will be required to sign a Declaration for Retiree Discount.
MUST-HAVE coverage
To drive on public roads in the province, you must have Direct Compensation - Property Damage
coverage, Uninsured Automobile coverage, Third-Party Liability and Statutory Accident
Benefits. These are all compulsory. This means that by law, you must purchase these coverages:
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