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Switching Auto Insurance Companies After an Accident

You may decide you want to switch insurance companies following a car accident. However, you must do your due diligence when doing so. Always ensure you have a new car insurance policy in place prior to cancelling your old one. Avoid a lapse in car insurance at all costs. If you have a lapse in your car insurance while you are still driving your vehicle, it is illegal. You must have valid car insurance to move your vehicle off your private property, it’s the law. Also, a lapse in insurance coverage can directly affect your insurance history. 

Should I Switch Insurance Companies After an Accident?

switching company

You can switch insurance companies at any time, even after an accident, however your insurance history and claims history will be assessed by every insurance provider, it may be cheaper to stay with your current insurance provider. 

Do Insurance Companies Raise Rates After an Accident?

If you are not found at-fault there should be no increase in your insurance rate. According to Ontario law, for any minor collision which occurred in July 2016 or later,  insurance providers are not permitted to increase insurance rates for minor collisions under $2,000 where there are zero injuries.  Depending on the degree of at-fault you are found, anything over 25% at fault to lead to an increase in car insurance. 

How Can I Lower My Car Insurance After an Accident?

There are a few ways you can lower your car insurance after an accident. You should:

Ask your insurance provider if your policy includes accident forgiveness

  • Maintain a good driving record post-accident
  • Increase your deductible
  • Always inform your insurer about any changes in your circumstances
  • Tell your insurance provider about any accidents no matter how small
  • Ask about other discounts you may qualify for
  • Shop around for a cheaper rate
  • Take a defensive driving course
  • Choose an insurance friendly vehicle
  • Maintain a good credit rating
  • Move to a low crime area

Can I Switch Insurance Companies in The Middle of a Claim?

insurance claim

Yes,  you can switch insurance companies in the middle of a claim however, you must follow through with the claim with the original company you filed the claim with. Although it is not ideal to switch insurance companies in the middle of a claim.

What is Accident Forgiveness and How Does it Work?

Accident forgiveness is an add on to a standard car insurance policy, which comes with its own cost. Accident forgiveness can stop your insurance rates from increasing due to a specific from being impacted. However, accident forgiveness does not prevent a driver from being charged under the Ontario Highway Traffic Act. If a driver is charged with a major driving conviction accident forgiveness won’t even apply. Not all drivers will qualify for accident forgiveness, each insurance provider will review your driving record to see if they will allow it. For example, a driver who was involved in an accident 4 years ago would have less of a chance of getting accident forgiveness than a driver who maintained a clean driving record for 6 years or more. Accident forgiveness also covers drivers if they are found at fault. However, only your first at-fault accident is forgiven. It is also important to remember at-fault accident forgiveness will not be erased from your driving record. If you were to switch insurance companies, the new insurance provider would be able to see the at-fault accident on your driving record. It is a good idea to purchase accident forgiveness if you qualify, especially if you have a good driving history and want to prevent a rate increase. It is an added layer of protection. Drivers should determine if the added cost of accident forgiveness on their car insurance policy will outweigh future higher rates. Accident forgiveness can be beneficial however it does not cover:

  • Secondary drivers – unless specified in your policy
  • Commercial vehicles – it is specific to personal policies
  • Demerit points – you can still accumulate demerit points
  • Charges laid under the Ontario Highway Traffic Act
  • Subsequent accidents until you keep a clean driving record for a long period of time

Each insurance provider may have its own rules pertaining to accident forgiveness, always ensure you read your policy thoroughly and ask your insurance provider any questions when you are unsure. Accident forgiveness can be reset after a certain period of time as determined by your insurance provider. 

Who Determines Who’s At-Fault in an Accident?

fault determination

Car insurance in Ontario has come a long way over the years, previously the claims process was a very long-drawn-out process prior to insurance providers having the ability to determine at-fault based on the Fault Determination Rules. This was due to the fact that in earlier years, the fault had to be determined prior to file a claim, the process was very long and drivers had to wait lengthy periods of time to have their claims processed. Now, with Ontario’s No-Fault Insurance Program, each driver reports directly to their respective insurance providers and the claim process begins. The two insurance companies decide who is at fault and to what degree. Each insurance provider pays out for their respective client’s claims. The only determination left that has to be made is who has to pay their deductible. 

When is The Best Time To Switch Car Insurance Companies?

You can switch car insurance companies at any time even in the middle of a claim, however, this is not an ideal time to switch companies. The best time to switch car insurance companies is upon the renewal of your existing car insurance policy. Prior to your policy expiring allow yourself time to shop around for rates and the appropriate coverage you require and have it in place to avoid a lapse in coverage. When you wait until renewal time to change insurance companies you may save on penalties that your insurance provider will charge for cancelling mid-policy. When cancelling a car insurance policy always provide your cancellation in writing. This will assure that you have a written record of the request, the date of termination, and when your coverage will end with that company.

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