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driving concerns

You answered a question from a Nova Scotia reader who said they traded in a car and didn’t let their insurance company know. I was surprised by this as I understood that dealerships can’t let you leave their lot unless your car has valid insurance because it’s illegal to drive without insurance. Isn’t that the rule here in Ontario? – Reza, Ottawa

There’s no rule that says dealers must ensure that you’re insured, but most do anyway.

“In Ontario, there is no requirement in the Motor Vehicle Dealers Act (MVDA) for a dealer to ensure that a vehicle is registered to the purchaser or that the vehicle is insured before it leaves,” said Laura Oprea, spokeswoman for the Ontario Motor Vehicle Industry Council (OMVIC), which regulates car sales in the province.

If you buy a car in Ontario, you have six days to make sure it’s registered at a ServiceOntario centre. If you’re going to drive it on Ontario roads, you need proof of valid insurance to get new plates, plate stickers or a temporary permit, said Ontario’s Ministry of Transportation (MTO).

Ontario dealerships will typically register your car for you before you pick it up, said Frank Notte, director of government relations with Trillium Automobile Dealers Association, which represents more than 1,000 franchised new-car dealers in Ontario.

”When I bought my car, I told them I wanted the same plates, so I had to provide the dealer with my insurance info and the dealer took that to ServiceOntario,” Notte said.

While Ontario dealerships will register your insured vehicle as a courtesy, it’s ultimately your responsibility to do so, MTO said.

Though the rules vary by province, generally the onus is on you to make sure your car is insured and registered.

“There is no regulation in Alberta that requires a dealership to confirm insurance or registration prior to delivery,” said Gerald Wood, president of the Motor Dealers’ Association of Alberta. “It’s against the law to operate a vehicle here without either in place, so our dealers generally will facilitate getting both insurance and registration completed in advance.”

Dealer’s choice

Depending on the province, you might have some leeway after you leave the lot.

Some provinces, including British Columbia, Alberta and Nova Scotia, let you switch your plates from your old car to your new one and give you a grace period to update the registration. In Alberta, for example, it’s 14 days, Wood said.

Other provinces, including Ontario and Quebec, don’t let you use your old plates on your new car until after it’s registered and insured.

If you’re not insured and get in a crash in your new car, could the dealer’s insurance be liable?

Although the exact process varies by province, once the car is in your name, you’re responsible for any crashes – not the previous owner or their insurance company, said Anne Marie Thomas, director of consumer and industry relations for the Insurance Bureau of Canada.

There’s a good reason provinces and dealers encourage car buyers to register and insure their vehicles as soon as possible. “If ownership isn’t changed, the previous owner of the vehicle can be held liable for any accident that involves that vehicle,” said Anne Marie Thomas, director of consumer and industry relations for the Insurance Bureau of Canada. By registering and insuring your vehicle, you’re taking responsibility for what happens behind the wheel.

While dealers don’t legally have to make sure that you have insurance on your car, banks and financing companies might.

If you’re financing the car, some banks or lenders require proof of insurance before they’ll pay the dealership, said Steeve De Marchi, executive director of the Association des marchands de véhicules d’occasion du Québec (AMVOQ), the Quebec car dealers association.

“Although this is common practice, we are seeing more and more lenders not requiring proof of insurance on every transaction,” De Marchi said.

In some provinces, including Quebec and British Columbia, dealers can often register the car for you right at the dealership – although you can choose to do it yourself.

Even though dealers can let you leave without insurance, it’s “extremely good practice” for them to make sure you’ve got it to protect both you and them, said Blair Qualey, president and CEO of the New Car Dealers Association of BC.

Have a driving question? Send it to globedrive@globeandmail.com and put ‘Driving Concerns’ in your subject line. Emails without the correct subject line may not be answered. Canada’s a big place, so let us know where you are so we can find the answer for your city and province.