Liability vs. Comprehensive vs. Collision Insurance
Ontarians need not be confused about what type of auto insurance coverage to purchase. Understanding the differences between the 3 types of auto insurance available in Ontario—collision, liability, and comprehensive—will ensure that you have the type of coverage that best meets your needs.
1. Liability Car Insurance
As with many other communities, Ontario requires its drivers to maintain liability insurance. Liability car insurance covers health care in the event of a motor vehicle accident, should you find yourself in those unfortunate circumstances. The amount set as the minimum requirement is to ensure that if you are driving on the road your safety in the long run is protected as much as the law can provide for.
2. Comprehensive Car Insurance
Comprehensive auto insurance covers different actions that can happen to your vehicle: Fire, vandalism, theft, flood, hail, etc. are all instances where comprehensive car insurance coverage is beneficial. Depending on your area and normal mode of operation with your vehicle, you may be required by your bank or lender to have a certain amount of comprehensive car insurance coverage on your vehicle. Comprehensive auto insurance comes with deductibles of different sizes and different details covered in the insurance plan. Make sure you are making an informed decision when choosing this portion of your auto insurance coverage.
There are two pitfalls to stay away from when choosing this type of insurance:
- A deductable that is too high. If you cannot afford the deductible of your insurance plan during a loss or claim, you may be physically without a automobile until you can meet your deductible.
- Not enough comprehensive coverage. Be honest with yourself about if you are in a situation of risk. Is your automobile being kept in an unsafe area frequently? Does that area you live in have storms or other factors that could cause your vehicle to be damaged unknowingly?
All of these things contribute to making a good decision on a comprehensive premium coverage amount, and a deductible amount. Make sure you are making the right decision that benefits you in the future.
3. Collision Insurance
Although having collision insurance in Ontario is optional, it also holds the same considering factors as we reviewed for comprehensive insurance regarding deductible and premiums. There are some additional things to consider with collision insurance. Since collision insurance covers your automobile during a collision, it is important that you insure the correct amount for your vehicle.
If you are going to be adding expensive aftermarket items to your car (A stereo perhaps, more expensive tires, etc.) it is important that you have the value of these items covered with the total amount of collision insurance you hold with your policy. Make sure you are accurate in totally these figures and make sure you check with your carrier to find out if there are any specific qualifications that will not be covered with your collision insurance policy.
All of these areas should be reviewed with you by your insurance company when choosing the right coverage for you. It is important that you are not rushed through the process of buying a plan and that careful consideration is taken on all of the contributing factors and that all of your requirements are being met.