This is a question that each motorist needs to decide for themselves.
The Ontario standard auto insurance policy is enough to get a vehicle legally registered and on the road.
The standard policy provides for $200,000 in third party liability insurance. When a driver has a serious at fault collision, accident settlements may climb above this amount. Liability coverage of $1 million or $2 million is often advised by insurance industry advisors.
Accident benefit coverage was until recently a single level of coverage. As of June 16, basic coverage reduced benefits by half in some situations. Look for additional accident benefit coverage to become more common over the next few years.
Collision and comprehensive insurance are not required to put a vehicle on the road, yet most drivers consider these essential. If money was borrowed to purchase a vehicle, the lending agency may require collision and comprehensive coverage as a condition of financing.
When a driver decides to carry collision and comprehensive, each is subject to a deductible amount. This is the portion a driver pays before the insurance company contributes. Higher deductibles mean lower auto insurance premiums, but also mean that the driver has a greater out of pocket burden after an accident. Low deductibles reduce this burden, but at the expense of higher monthly premiums.
Once a motorist decides on an insurance company, working with an agent or broker is the best way to balance the coverage/cost equation.
What’s in a Standard Auto Insurance Policy?
In Ontario, certain levels of insurance coverage are required for all vehicles on the road. This standard, or statutory, policy includes four main insurance elements. No insurance provider can issue a policy with less coverage than these standard levels.
Third party liability insurance in the amount of $200,000 protects a motorist against legal action following an at fault accident. Most industry advisors feel that this level of coverage is inadequate, as settlements for serious accidents often exceed this amount, leaving a motorist financially exposed to large settlements.
Accident benefits pay out from a driver’s own insurance company, regardless of which driver is originally at fault. These amounts pay for health and attendant care in excess of provincial health plan benefits, for those injured in an accident. Recent changes to the Insurance Act reduced the amount insurance companies cover under the statutory policy, so additional insurance to top up accident benefits is now available.
Direct compensation – property damage pays benefits directly between a motorist and their insurance company in the event of an accident for which the other driver is at fault, and when certain other conditions are met. These benefits pay for repair and loss to the motorist’s vehicle or its contents, including amounts for loss of use of your vehicle.
Uninsured automobile coverage protects in cases where the other vehicle in a collision is either uninsured or unidentified, such as with a hit and run accident.