How Much Car Insurance Coverage Do I Need?
When looking for auto insurance, consider the following three questions with the help of your agent:
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Determining Car Insurance Coverage
1. How high should the auto liability coverage limits be on my car insurance?
No one can predict exactly how much you would have to pay if you were to cause an accident.
Every province sets a minimum coverage level. Selecting more than the minimum coverage would increase your cost now but potentially give you more protection in case of an accident. Since it's impossible to know the most you'd have to pay if you were to cause an accident that resulted in bodily injury or property damage, be sure to take some time and consider whether you'd be able to afford any damages that exceed your insurance coverage. The higher your limits, the more likely it is that we'll be able to pay all of the damages for you.
The higher your liability coverage limits are, the more likely your auto insurance policy will be able to pay all of the damages.
2. How high or low should my collision auto insurance and comprehensive deductibles be?
Higher deductibles lower your premium but increase the amount you must pay out of your own pocket if a loss occurs.
Ask yourself how much you would be willing and able to pay on short notice in order to save on your premium.
3. Should my auto insurance include collision and comprehensive coverage?
You may be required to carry collision or comprehensive coverage if your vehicle is leased or financed.
Once you have paid off your car, and its value decreases, you might consider dropping these coverages to save money on your auto insurance.
Consider, though, whether the savings would be enough to offset the risk of having to pay the entire cost of repairing or replacing the vehicle.