As a car owner in Canada, you would like to cherish your freedom of driving. As per the norms, you need to get automobile insurance to secure yourself from unforeseen expenses arising from accidents. While it’s imperative to get this insurance policy, it’s wise to know how much you need to shell out.
In this post, we have covered how much premium drivers need to shell out, calculating the value depending on their age. Remember, the laws require every car owner to purchase insurance to warrant cash inflow for others, as well as for themselves. From the standpoint of affordability, car insurance rates are turning out to be expensive. Therefore, it makes sense to consult a specialist for car insurance in Calgary.
Read on to understand how age affects car insurance rates in Canada.
Factors Impacting Cost Of Car Insurance In Canada
Several factors influence the cost of automobile insurance in Canada. The prime elements include:
Driving History:
This includes the number of speeding tickets and accidents recorded by you.
Driving Experience:
Your experience in driving in Canada, and not any other country.
Age:
In general, the premium rates are lower for older and experienced drivers.
Location:
The premium would be higher in crowded cities such as Toronto, as compared to smaller towns.
Gender:
Usually, premiums are lower for women as compared to men. The insurers consider men to be riskier when it comes to driving.
Nature Of The Vehicle:
Cheaper cars with high safety ratings attract low insurance premiums.
Usage Of Vehicle:
Chances of accidents are higher if you happen to drive more often. In these cases, insurance rates would be higher.
Winter Tyres:
Drivers who use winter tyres can avail of discounts on insurance rates during winters.
What Is The Average Insurance Premium Per Year?
While several factors influence the annual car insurance premium in Canada, have a look at the average cost you need to shell out in different areas of the country.
British Columbia is the most expensive and Quebec is the cheapest province in terms of car insurance premiums respectively. The average premiums in these two provinces are $1,832 and $717 respectively. In other cities like Ontario, Alberta, and Manitoba, the rates vary between $1,140 to $1,528 per year.
However, in some provinces, car owners enjoy lower premiums, ranging between $816 to $891. These provinces include Prince Edward Island, Nova Scotia, and New Brunswick.
How Does Age Influence Your Insurance Cost?
Age is one of the determining factors of the premium you need to shell out. Young drivers, aged between 18 and 25 are faced with higher insurance rates. As they grow older, they gain experience, and eventually, the insurers reduce the rates. (Of course, the risk quotient with young drivers is higher)
This explains why insurance companies charge higher premiums from this particular age group. Besides, young drivers are likely to flout norms on impulse or take resort to rash driving. Therefore, as you cross your mid-twenties, you would be charged low premium rates. If you manage to maintain a clean record, the insurers would consider lowering the premium even further.
This rate would continue to dip as you grow older. Only when you reach your 80’s, the insurers would again hike the premium. Considering age-related driving issues, the risk quotient appears to be higher for senior citizens.
To give you a better idea, let’s take a look at these figures:
- People who have just started driving at the age of 18 need to shell out anywhere between $565 and $1,280 on the car insurance premium on a monthly basis. This takes the yearly average to $11,124.
- By the time you reach 22, the monthly premium would vary between $318 and $476, depending on your location. In this case, the yearly average insurance cost would be $4,764.
- At 25, you have to shell out a monthly amount of $220 to $309. Here, the yearly average drops to $3,174.
As you keep gaining experience at the wheels, the annual average premium would keep dropping. Considering the high rates for people aged between 18 and 25, it is logical to approach insurance specialists for professional consultation. These experts can help you find discounts from reputed insurers, eventually saving you money.
Several factors may also affect the insurance rates within this period. These include a clean driving record, purchasing another car, etc.
Deciding How Much You Should Pay: What Do Insurers Consider?
Certain factors associated with your age also influence how much premium you need to pay.
1.License Level
At a young age, drivers are mostly inexperienced. This often results in accidents, which indicate a greater risk for the insurer. Besides, each province in Canada has its own licensing requirements. Therefore, it becomes difficult to compare the qualifications of drivers and rates of insurance.
For instance, the ICBC (Insurance Corporation of British Columbia) offers all BC drivers with basic insurance. Citizens holding a learner’s permit would get auto insurance in these cases. On the other hand, drivers in Ontario holding a G1 license fail to get insured when they happen to be the primary driver. The insurance companies can add them as secondary drivers to the insurance held by their parents. However, no additional charge would be required in this case.
Again, drivers from Ontario with a G2 license may have to shell out more money. In these types of licenses, the insurance costs are generally higher than a full G license.
2. Level Of Insurance
Every driver in Canada needs to purchase mandatory coverage as per their territorial or provincial government. This level of insurance would determine the cost, considering factors like age and gender. Besides, it might be a good idea to invest in additional insurance for better protection.
3. Your Vehicle
The CLEAR (Canadian Loss Experience Automobile Rating) system has rated the threats to your car from the standpoint of insurers. These ratings include different factors like the presence of airbags, anti-lock brakes, etc. Considering all these factors (along with your age), the insurance premium is decided.
Endnote
There’s a whole maze of factors determining the insurance premium you need to shell out. Although this post will give you an adequate idea of how much your car insurance premium would cost you based on age, it’s recommended to consult an insurance specialist. Experienced professionals would be able to guide you, eventually landing you up on the economic end.