3 Rules for Getting Your Auto Insurance Right

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Editor’s note: This article was originally published on August 21, 2013 and was updated on September 24, 2015.

Getting the facts wrong on your car insurance could potentially cost you money in the form of denied claims, particularly if you go with a “cut-rate” insurer for your vehicle. It’s very important to get the facts right on your policy, including how much you drive your car, the drivers that you’re allowing to use the car, and where it’s being parked.

On the other hand, most Canadians can be forgetful. Let’s face it, we can forget to call our insurance company when circumstances that may affect our auto policies change. It happens. But a quick phone call to your broker once a year or when you need to can make a huge difference in the amount of a claim you’ll receive, or even if you’ll receive a claim at all.

Getting the facts wrong on your car insurance could potentially cost you money in the form of denied claims

Rule #1: Avoid Cut-Rate Auto Insurance

Everyone wants to pay less for auto insurance. It doesn’t matter how much money you make, it’s an ongoing expense that most of us would like to see decrease rather than increase. However, if you read the fine print of most “cheap” auto insurance policies, you’ll see a huge list of exclusions that could keep you from being able to get a claim when you need to.

Rule #2: Get the Policy Right the First Time

Probably the most common thing that people get wrong on their policy is how they use the vehicle. When you first got the policy, one spouse may have been staying home taking care of the kids. When they go back to work and start commuting with their car, it’s very important to tell the insurer to prevent reduced or denied claims should an accident happen during their commute.

The next thing you should look out for is how you’re parking your vehicle overnight. If the only spot available is street parking, be sure to tell your insurer to avoid not being paid out on a vandalism claim. Even on a quiet suburban street, this can be a problem.

Kilometres driven per year can also be a sticking point at claim time, and it’s probably the hardest number for an average driver to estimate. To get it right, use Google Maps to calculate the distance between your home and work, and add up the kilometres for your commute both ways. Then, take your daily number and calculate it by the number of working days in a week, and then multiply that by the number of working weeks in a year. Add 10-20% for personal use, depending on how much you use your vehicle on weekends and evenings. How will your insurance company know if this number is off? If the kilometres on your car don’t match up with your estimated number if you get in an accident, claim time could get a lot more stressful.

Who is allowed to drive your car is another important feature of a policy. Double-check to make sure that you can toss your friend the keys to your truck if he needs it to take home something heavy from the store; some insurance policies do not allow for this. If your buddy gets in an accident, you could be on the line for the cost. Same thing goes for student drivers, or even other family members.

Kilometres driven per year can also be a sticking point at claim time, and it’s probably the hardest number for an average driver to estimate.

Rule #3: Get a Broker for Your Auto Insurance

While insurers are generally pretty good about letting you know what facts they need for your policy, a broker has experience in dealing with both claims and writing policies. They’ll know exactly what the insurance companies look for at claim time, and they’ll help you calculate mileage, let you know what the exclusions are for certain policies, and make sure you get into the right insurance policy for your situation. They’ll also be your partner at claim time, which is probably one of the best arguments for using a broker. They’ll help you fill out paperwork, direct your questions to the right people, and generally just make sure you’re taken care of.
If you’re looking for auto insurance in Alberta, give us a shout or email us to get a quote and find out just how awesome dealing with a broker can be.


Location, location, location – we took this age old real estate saying to heart when we situated Scott Marit, Personal Insurance Account Executive directly in house at the First Foundation…

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