How much is insurance for a new driver?
It’s a simple question, but one whose answer depends on where you live, how much you drive and the type of coverage you need.
It’s a simple question, but one whose answer depends on where you live, how much you drive and the type of coverage you need.
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You might believe that all you need to do to hit the open road is pass your driver’s test and put your keys in the ignition, right? Wrong. All drivers in Canada, including new ones, must also obtain auto insurance before they can legally drive. So, how much is insurance for a new driver? If you or someone in your household has decided to get their driver’s licence, here’s what you or your loved-one can expect to pay for coverage.
Many factors influence a new driver’s insurance premiums. Some of the main considerations include:
The amount of coverage you decide to purchase will also have an impact, and minimum coverage amounts vary considerably by province and territory. To give you an idea, in Ontario, a new driver must have third party liability insurance with a minimum coverage of $200,000, as well as accident benefits, direct compensation property damage and uninsured automobile coverage.
As noted above, the cost of insurance depends on numerous factors, so there’s a huge range in premiums across the country. On average, you can expect to pay anywhere from $1,500 to $7,000 per year. It’s worth noting that premiums for new drivers who are older are less expensive than for those who are under the age of 25. A new driver in their 30s or 40s may pay anywhere from $50 to $100 less per month. Keep in mind, however, that even for older drivers, insurance rates will depend on factors like your driving record and place of residence. Since prices among insurers can range significantly even within the same region, it’s always a good idea to shop around and compare prices.
The average cost of car insurance in Canada is $1,142 annually, according to data from the General Insurance Statistical Agency. For example, for car insurance in British Columbia, drivers pay an average of $1,832 a year, while in Quebec the average is $717—the lowest in the country.
Province | Average of cost of car insurance |
---|---|
Alberta | $1,316 |
British Columbia | $1,832 |
Manitoba | $1,080 |
New Brunswick | $867 |
Newfoundland and Labrador | $1,168 |
Nova Scotia | $891 |
Ontario | $1,505 |
Prince Edward Island | $816 |
Quebec | $717 |
Saskatchewan | $1,235 |
The range in provincial car insurance premiums is due to differences in average auto repair costs, the relative frequency of insurance fraud and the prevalence of injury claims and related lawsuits. The mandated minimum amount of coverage a driver must carry in a given province matters, as does the insurance system in place.
In B.C., Saskatchewan and Manitoba, drivers purchase insurance from the government. In Alberta, Ontario and the Atlantic provinces, which use private insurance companies, drivers can shop around and compare providers. Quebec is the only province that operates on a hybrid system.
If you plan to share a vehicle with another driver (like a parent, for example) and only drive occasionally, you can get secondary driver insurance, also known as occasional driver insurance. Secondary driver insurance is an affordable option, because you don’t have your own policy. Rather, you are added to the main driver’s policy, and that person pays a higher premium.
However, there are circumstances in which you must get your own insurance policy. If you are going to be driving a car more than once or twice per week—for example, as part of your daily commute to work—you will need your own policy. If you’re unsure of what constitutes a “secondary driver,” ask your insurer. Failing to abide by the rules of your policy could render your coverage void.
Understanding your policy and comparing the prices and coverage offered by various providers is one of the best ways to ensure you’re getting a competitive rate. However, here are some other ways new drivers may be able to lower their insurance costs.
For the reasons described above, there’s no simple answer to the question, “How much is insurance for a new driver?” Ultimately, it depends on a host of factors, such as your province of residence, your age and gender, and whether or not you qualify as a secondary driver. Doing your research will help you budget for the costs of being a new driver.
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