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ask joanne

About three years ago. my girlfriend rear-ended the car in front of her and created some damage to both cars. She reported the accident to her insurance company and it paid for the damages. Consequently, her insurance rate went way up in cost. She drove rarely, decided to sell her car and cancelled her insurance. Shortly thereafter, she moved in with me and we have been living together for three years now. On rare occasions she drives my car. I have not informed my insurance company of this situation and would like to know if she would be covered by my insurance in the event of an accident. – Jim in Toronto

Your car insurance policy is a legal agreement between you and the insurance company. You agree to let it know all the pertinent details of your driving situation, and it agrees to pay you for any claims.

I checked with various insurance professionals, and they were unanimous about the necessity of full and honest disclosure when entering into an insurance agreement.

"You are required under the conditions of your auto insurance policy to notify your insurer if there are any changes that may affect coverage," writes John Bordignon, of State Farm Canada. "For example, if you modify your vehicle mechanically or cosmetically, or if a person lives in the same household and has access to your vehicle."

Section 1 of the Ontario Automobile Policy (OAP 1) is clear about the responsibilities of the policy owner, as demonstrated in this excerpt: "You also agree to let us know of any change that might increase the risk of an incident or affect our willingness to insure you at current rates. You must promptly tell us of any change in the information supplied in your original application for insurance, such as additional drivers, or a change in the way a described automobile is used."

Further, in Section 8: "The insured named in this contract shall promptly notify the insurer or its local agent in writing of any change in the risk material to the contract and within the insured's knowledge."

"I would suggest the use of the vehicle by the unlisted driver is a material change to the insurer and your reader should advise his insurer of the unlisted driver," writes Ken Dusenbury, claim director at CAA Insurance Co. in South Central Ontario. "Coverage under the contract could be jeopardized in the event of a claim."

Bordignon echoes this. "If Jim's girlfriend were to get into an accident, his insurance company would ask if she shares his address and if she has access to his vehicle. If she is not listed under his policy, and depending on the circumstances involved with the claim, they may deny coverage."

The Ontario auto insurance form asks applicants to list all drivers of the described automobile(s) in the household or business. If anyone is living with you and using your vehicle, even on rare occasion, it must be disclosed.

In your case, the downside is that your insurance premium may increase if your policy is rated for your girlfriend's driving record.

"On the other hand, if she drives only rarely, and he doesn't want to have her rated for an accident on his policy, he might want to consider excluding her as a driver," says Anne Marie Thomas of "He could ask his insurance professional to have her excluded from his car, which means there is no insurance if she drives it.

"She's not doing herself any favours, though, by not maintaining an insurance history, because she might want to insure a car again in the future. If she waits until the accident is off her record in six years time but she has no verifiable insurance for the last six years, she might end up paying a considerable amount then anyway," says Thomas.

When it comes to disclosing the details of your driving situation to your insurance company, honesty is the best policy. Otherwise, if your girlfriend continues to use your vehicle and is involved in an accident, you're gambling on the outcome. In a worst-case scenario, where your policy is cancelled and the claim is denied, you'll be left paying for the damages. Your insurance premium could also skyrocket with a failure to disclose on your record.

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