Usage-based insurance - MoneySense

Usage-based insurance

What is it and how it could save you up to 25% on premiums, plus other stories in the daily roundup.

  • Usage-based insurance has recently launched in Ontario and Quebec on a voluntary basis by Desjardins Insurance and its subsidiary, The Personal Insurance Company. But what is it and how does it work? A small wireless device is installed into a vehicle’s diagnostic port to measure distance travelled annually, frequency of hard braking and acceleration, as well as time of day the vehicle is driven. Drivers can then log in online and share the info with their insurance company to determine whether they can save on insurance, up to a maximum of 25%, based on their habits.
  • Roughly half of Canadians have more than $10,000 set aside in an emergency fund while 17% have less than $1,000 and 20% have up to $5,000, according to a new poll for BMO. “Financial emergencies, such as a broken furnace or major car repairs, can crop up at any time and, without some form of financial cushion, can potentially cause households to take on more debt than is necessary,” said BMO’s Janet Peddigrew. The ideal emergency savings fund should be equal to three to six months of your income.”