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Ontario is home to the largest population of any Canadian province – 40% of Canada’s total population – and is also a geographically large and diverse province. From cottage country to the busy streets of Toronto, Ontario drivers have a varied experience and different insurance needs.

Ontario drivers can expect to pay very different insurance rates depending on where they are located in the province, but overall rates are higher in Ontario than anywhere else in Canada. The reason for that is generally seen as the incredibly high rate of insurance fraud the province has been battling for years.

Average Car Insurance Rates in Ontario

Ontario has insurance rates as varied as the province and its people. With a median rate of $1538 per year, based on a 35-year-old with a clean record, Ontario is the most expensive province on average for drivers.

Drivers in the Greater Toronto Area pay rates far above the median. In fact, 9 out of the 10 most expensive cities in Ontario for car insurance are located in the GTA. Brampton topped the list for 2015 at 44% above the median with an average rate of $2,393. Woodbridge, Vaughn, and Toronto all pay average rates about $2,000 per year.

Southeastern Ontario drivers pay the lowest rates in the province. Rates in Belleville, Kingston, Nappanee, and Cobourg fall at the bottom, averaging $1, 014, more than a thousand dollars less than the top GTA cities. Those numbers are still well above the cheapest average car insurance rates in Canada, which are several hundred dollars less in neigbouring Quebec.

Minimum Car Insurance Requirements in Ontario

Ontario drivers are required by law to carry at least $200,000 in third party liability, and coverage that meets the province’s accident benefits requirements. These include:

  • Medical payments coverage
  • Funeral Expense benefits
  • Disability Income benefits
  • Death Benefits
  • Impairment Benefits

Ontario state law allows only $10,000 for property damage if the injuries and damage together in an accident exceed the $200,000 liability limit. There are also caps on injury payments for minor and non-catastrophic injuries.

Driver Licensing in Ontario

Ontario uses a multi-stage graduated licensing system for new drivers. Each level has specific requirements to graduate to the next stage. The levels of licensing are:

  • G1 license, allowing drivers to begin practicing behind the wheel with a licensed driver supervising
  • G2 license, which allows unsupervised driving within certain restrictions
  • G license, the full, unrestricted license

New drivers face some of the highest insurance rates due to a higher statistical likelihood of an accident, a result of inexperience.

Teen Driver Risks

Teen drivers are far more likely to die in a car crash than any other age group in Ontario. While zero-tolerance laws for drinking and driving are a part of the graduated licensing program in Ontario, impaired driving is still a major problem.

In addition to a high rate of drinking and driving deaths across the province, the use of drugs before driving is also a rising problem.

Teen drivers are also at a high risk of distracted driving crashes. In 2013, teens in Ontario reported in a study that on average one-third had texted while driving, a number that rises to 46% of Grade 12 drivers.

All of these factors contribute to the high cost of car insurance for teen drivers in Ontario.

Distracted and Impaired Driving Overall

Ontario’s teens are not the only drivers who engage in unsafe behaviours. Harsh laws against impaired driving are in place, including loss of driving privileges, impounding of the vehicle, fines, and jail time.

Statistics Canada’s 2011 report on drunk driving offences counts Ontario among the provinces with lower rates per 100,000 population that other Canadian provinces, with rates declining in the previous decade.

Ontario law also prohibits the use of any handheld mobile device while driving. Use of these devices increases the risk of an accident by four times.

Ontario’s Fault Determination Rules

A major difference between Ontario insurance and other provinces is the use of standard, province-wide fault determination rules for insurance companies. All insurance companies regardless of extenuating circumstances apply the fault rules the same way, ensuring objective decisions.

These rules are regulated by the government and legislated as part of the Insurance Act.

Insurance Fraud in Ontario

Problems with widespread insurance fraud in Ontario have led to high rates and a response from the government. Recent legislation aimed at addressing the problem has led to reductions in rates across the province, but fraud remains an issue affecting Ontario drivers.

The Fighting Fraud and Reducing Automobile Rates Act was passed in 2014, and has had some success, but has yet to reach the promised reductions of 15% across Ontario. The act addresses injury claim dispute resolution and regulation of the towing and auto storage industries.

Auto Theft in Ontario

While auto theft has been on the decline across Canada, Ontario still has the highest rates in the country.

For 2014, the most stolen cars in the province include high-end SUVs such as the Acura RSX and BMW X6, and mid-range SUVs such as the Toyota 4Runner and Highlander.

Auto theft is a major strain on the insurance industry, costing insurers across Canada about $542 million each year, and driving up Ontario’s insurance rates.

Car Insurance in Ontario

Drivers in search of the cheapest car insurance in Ontario need to be careful to maintain a clean driving record. Making a careful choice when purchasing a vehicle also helps keep rates low, avoiding the most stolen vehicle types as well as those with higher rates because of value or other risks.

New usage-based (telematics) insurance options introduced in recent years will allow good drivers to earn discounts for their safe driving habits and help bring rates down further.

As always, shopping around is the number one method for Ontario drivers to find the cheapest car insurance.