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Many factors contribute to the cost of your auto insurance. Some factors are personal, such as your driving record and claims history. Other factors are statistical and out of your hands. One of these is where you live. The accidents and insurance claims that happen in the area around you influence the price you pay for car insurance. For drivers in and around Toronto, the difference can be major.

The Best Areas for Car Insurance in Toronto

Insurance companies use postal codes to collate geographical data. How, exactly, is up to each company, as no two insurers use the same formula for premiums. It doesn’t matter if a driver has never had an accident or insurance claim in a particular neighborhood, the history of the area still weighs in.

The lowest postal codes for car insurance in 2015 were centrally located. A diagonal strip running north and south through the middle of the city had the lowest average premiums. Leading the way were codes in the M6G, M5P, and M4P regions, Christie, Forest Hill North, and Davisville North. Rates ranged from $1,479 to $1,503, roughly equal to the 2015 average for all of Ontario.

The cheapest regions in Toronto are still expensive when compared with the best rates in the province. Areas near Kingston, Belleville, and Napanee hovered around $1,000 in 2015.

The Most Expensive Areas for Car Insurance

In contrast to the affordable areas, the most costly auto insurance rates were found at the northern corners of the city. Areas in both the northeast and northwest corners filled the top ten highest average price hotspots. M3N, M9V, and M1X held the dubious distinction of the most expensive car insurance in the city. Average costs in Downsview, Etobicoke – Albion and Scarborough – Upper Rouge were $2,422, $2,428, $2,373 respectively.

The highest car insurance prices in Canada are just beyond the Toronto city limits. Brampton and Vaughan add about another $100 to the already high rates found in northern Toronto, with average rates about $2,500 for 2015.

Things to Consider When Buying Auto Insurance in Toronto

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Whether a first-time buyer or renewing for another year, an Ontario motorist faces auto insurance choices that balance coverage and cost. As Canada’s most expensive province for car insurance, many insurance consumers are chiefly concerned with price and keeping it down. This strategy may leave them wanting coverage if the worst occurs.

Buying car insurance requires awareness of both insurance itself and what coverage is right for individual needs. Ratelab presents this Buying Guide to walk through all aspects of auto insurance buying in Ontario. Refer to the Financial Services Commission of Ontario, the provincial insurance overseer, for more information.

The Basics: Minimum Mandatory Coverage

Ontario requires that all vehicles have at least a minimum of insurance coverage to use the province’s roads. This coverage consists of four parts and it is the very least coverage you can carry. The four parts are:

Third-Party Liability Insurance

If other people suffer injury, loss, or damage as a result of your driving, they may have the right to sue you for some of these losses. Third-party liability protects you against such action. A minimum of $200,000 is required by the government. Additional coverage can be purchased since insurance settlements for major accidents can easily exceed this amount.

Accident Benefits

Ontario’s insurance system is partially no fault in nature. If you are hurt in an accident, medical costs above those covered by provincial health plans are paid for by your own insurance company. This is the case no matter who was at fault. Certain limits are set in insurance legislation. Additional coverage can be purchased to extend this.

Direct Compensation – Property Damage

Another element of no-fault insurance in Ontario, you are compensated directly for loss by your insurance company when another driver is responsible in certain situations. If conditions for this coverage are met, damages usually covered under collision insurance are paid through the DC-PD section.

Uninsured/Unidentified Driver Coverage

In the case of a hit and run accident or a collision with a driver who has no auto insurance, this section provides protection.

Optional Insurance Coverage

To cover your car against damage or loss in all situations, collision, and comprehensive coverage is necessary. Though not required by the provincial government, you may be required to carry this optional coverage if you’ve borrowed money to buy your car.

Collision insurance covers loss or damage when your car is in collision with another car or object or if it rolls over. “Object” can include the ground or something embedded in the ground. For example, the van lost to the downtown Ottawa sinkhole of 2016 would be covered under collision coverage.

Comprehensive insurance covers things not protected under collision provisions. Most commonly this includes theft, vandalism, and fire.

Finding the Lowest Car Insurance Rates in Toronto

Ontario’s car insurance market is highly regulated, but it remains competitive as it is supplied by private insurers. Operating under the oversight of the Financial Services Commission of Ontario, each car insurance provider has its own approach to insurance underwriting. This means that the same coverage compared between companies can sometimes be quite different in cost. The best way to ensure the lowest car insurance price is through extensive comparison shopping.

Ratelab‘s car insurance calculator is your best bet to secure quotes on the lowest-cost auto insurance coverage available for your needs. The calculator takes your information and searches dozens of providers to match your needs. The lowest-priced coverage results in no-obligation quotes delivered directly to you. It’s a free service and there’s no cost to use it.

Start today by entering your postal code below. The more complete the data you enter, the more accurate your quote will be.

About the Author: Valerie D. Hahn

Valerie is an insurance editor, journalist, and business professional at RateLab. She has more than 15 years of experience in personal financial products. She strives to educate readers and ensure that they are properly protected.

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