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Buying a car

What insurance do I need for my car? Add to ...

This chart shows you some of the main things you’ll find in a car insurance policy. It also shows you the basic coverage you must have, by law.

What it’s called in your policy

What it covers

Basic coverage you must have


Covers you against claims if an accident with your car hurts or kills someone, or damages their property.

At least $200,000 to pay claims.

Accident Benefits

Covers you if you are injured in a car accident, no matter whose fault.

Also pays money to your survivors if you die in an accident.

Pays up to $400 a week if you can’t work after a car accident. Also covers a wide range of medical and other costs.

Pays $25,000 to your spouse or partner, plus $10,000 more for each child you have.

Also pays up to $6,000 for funeral costs.

Direct Compensation - Property Damage

Pays to repair damage to your car or its contents when someone else is at fault.


Uninsured Automobile Coverage

Pays you and your family if you are injured or killed by a hit-and-run driver or by an uninsured motorist.

Also covers damage to your vehicle caused by an identified, uninsured driver.


What extra coverage can I choose?

  • Collision insurance

Cover your losses caused when an insured vehicle rolls over, or is involved in a collision with another object.

  • Extra liability insurance

Adds more coverage against claims from someone else if your car is involved in an accident.

Many policies today have limits of $1 million or more. The cost to increase insurance coverage from $1 million to $2 million is small.

  • Comprehensive insurance, or some perils
  • Specified Perils covers your car for losses caused by specific events such as theft, fire, lightning, hail, rising water, or riot.

Comprehensive Coverage covers all of these losses, and more. Most car owners choose this option.

Increased benefits

• Adds extra medical, accident, or death benefits to safeguard against losing your income.

• Might be worth looking into if you have a large income.

Tip: Car insurance never covers rusting, damage to tires, wear and tear, or breakdowns. Ask your car dealer if your warranty covers any of these problems.

Remember: For most people, basic coverage is not enough

On the other hand, you don’t want to pay for insurance you don’t need. Think carefully before you choose your car insurance. You may want to talk to a licensed insurance agent or insurance broker before you buy.

Content in this section is provided in partnership with Investor Education Fund, a non-profit organization founded and supported by the Ontario Securities Commission that provides unbiased and independent financial tools to help Canadians make better money decisions. To find out more, go to: GetSmarterAboutMoney.ca


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