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Standard Auto Insurance Policy & Additional Coverages In Ontario -

July 26, 2013

Mandatory Auto Insurance Coverage In Ontario

It is mandatory for automobiles to be covered by these four types of automobile coverage:

1. Third Party Liability Coverage

In the event that a person is killed, injured, or suffers loss of or damage to property at your fault, this coverage will pay the costs of settling any claims filed against you. Such coverage only pays for claims up to the limit of your coverage.

2. Statuary Accident Benefits Coverage

In the event that you are injured in any motor vehicle accident, the Statuary Accident Benefits Coverage section of your policy will grant you benefits, no matter which party is at fault. This section of your policy covers the costs of compensation for medical costs and damages, including things such as additional medical costs, attendant care, caregiver costs in the event of a more serious injury, non-earner/disability/income-replacement, and rehabilitation costs.

3. DC-PD (Direct Compensation - Property Damage Coverage)

In the event that you are involved in an accident at the fault of another person, this section of your auto insurance coverage will provide you with compensation for your property damage. Although the damage that this policy covers is caused by someone else, the reimbursement comes directly from the insurance company you're insured under, rather than the offender's insurance.

It's important to note that there are several conditions that should be met in order for DC-PD to apply.

4. Uninsured Vehicle Coverage

In the event that you or your passengers suffer injury or death at the hands of an uninsured driver, this policy will cover costs of medical attention and reimbursement fees.

Additional Coverage Policies

There are several types of additional coverage policies you can purchase to compliment your basic coverage plan.

1. Specified Perils Coverage

In the event of an unpredicted event such as (but not limited to) a fire, theft, or a theft attempt, or the occurrence of a natural disaster such as flooding, lightning striking, or an earthquake, the insurance policy will cover the repair, replacement, or reimbursement costs of the damages. This sort of coverage also covers liabilities incurred during vehicular transport by land or water. Please note that such coverage is limited to the perils outlined in the coverage plan.

2. Comprehensive Coverage

Other than losses from Collision or Upset, this coverage pays for losses including perils listed under falling or flying objects, missiles, vandalism and Specified Perils.

3. Collision or Upset Coverage

In the event that an insured vehicle is involved in an accident in which it comes in contact with any object (including an automobile or the ground) or rolls over, Collision or Upset coverage will pay the cost of any damages incurred in the incident.

4. All Perils Coverage

All Perils Coverage combines the prior listed coverage plans (Collision or Upset and Comprehensive) and provides coverage caused by any unpredicted circumstance, including theft by a member of your household or car repairman. All Perils Coverage does not outline any specific circumstance, yet it protects against all of them.

It's important to note that a deductible may apply, depending on the plan chosen, the location, and whatever other factors your insurer might deem fit.

Other Options for Enhanced Coverage

There are advanced coverage features that you can add to your insurance plan. While these vary by province and city, they allow you to tailor a unique insurance plan that best suits your needs. These features are known as policy endorsements (called Ontario Policy Change Forms (OPCF)), and allow you to modify the amount of coverage depending on varying situations.

The most common of these policies are:

Protection for Rented or Leased Vehicles (OPCF 5):

This feature covers the insurance for a leased car that is driven by an individual who does not own it.

Protection In the Event of Loss of Vehicle Use (OPCF 20):

This feature ensures that a driver is not disadvantaged during the time of vehicular repairs or replacement by covering the cost of a rental car. This is limited to individuals who are insured against the liability that caused the loss of vehicle use.

Protection Against Damage to Non-Owned Automobile(s)(OPCF 27):

This feature provides reimbursement or repair coverage for physically damaged vehicles that an individual operates, but does not own such as rental cars, leased cars, and company cars.

Protection Against Depreciation Deduction (OPCF 43):

During the process of settling a claim, the insurer has the right to deduct depreciation from the overall value of a vehicle. This feature nullifies that right, protecting an individual against deductions caused by the events an individual is insured against.

Family Protection Coverage (OPCF 44R):

This feature protects you and your eligible family members (outlined in your insurance agreement) the same way that third-party liability coverage insures you, hit and runs, or unidentified third parties.

Added Coverage Against Deductibles (OPCF 48):

This endorsement reduces the amount deducted from compensation awarded by the court for pain resulting from an accident to $20,000 from $30,000, and for Family Act claims to $10,000 from $15,000.

However, it's important to bear in mind that several of these policies may be subject to deductibles. Your insurer may have other features available, so ask an auto insurance broker about which plans and features would work best for you.

Additional Resources & Advice

Looking for more information on auto insurance in Ontario? We've prepared some guides to help you:

Visit our Insurance Tips & Information Centre for more useful tips and guides on car insurance.