Have you lived in numerous provinces throughout Canada? Do you have close friends or family in different provinces? Then you may have heard that the province that you live in plays a significant role in determining your car insurance rates.

For instance, Ontario and Quebec have vastly different average auto insurance rates, even though they're neighbouring provinces. Why exactly is this the case?

In this article, we'll settle the Quebec car insurance vs Ontario car insurance controversy once and for all. We'll go over the basics of car insurance, the price differences and assess various price-influencing factors specific to each province.

Car insurance Quebec vs Ontario car coverage — how does it work?

Let's start with the basics — how does car insurance work in Quebec and Ontario?

Car insurance in Quebec

In Quebec, drivers are required to acquire car insurance via a "hybrid" method. The hybrid method requires drivers in Quebec to purchase mandatory liability insurance from a sector of the provincial government. Other forms of car insurance, like property damage, are available through private providers.

Car insurance in Ontario

In contrast, Ontarian drivers can purchase a variety of different types of car insurance from private providers. The Ontario government doesn't offer any form of coverage for drivers; however, it is worth noting that the provincial government is a part of the regulation process.

These differences play a massive role in determining why there is such a noticeable gap between car insurance prices in Ontario and Quebec.

What is the average annual price of car insurance in Quebec and Ontario?

Now that we understand the fundamental differences between obtaining car insurance in Ontario and Quebec, we can look at the price differences.

In 2020, the average price of car insurance in Ontario and Quebec was:

Ontario — $1,445 per year

Quebec — $660 per year

Despite the fact that the provinces are side-by-side, the average driver in Ontario pays more than double for car insurance than a driver in Quebec. 

Why is there such a substantial average price difference between car insurance in Ontario vs Quebec?

There is a long list of reasons why drivers in Ontario pay more for car insurance than drivers in Quebec:

Factors in Ontario

Here are some of the most significant factors:

More luxury cars

In comparison to Quebec, the province of Ontario has significantly more luxury vehicles. For instance, over half of the vehicles on the Ontario’s Top Searched vehicle list 2020 are luxury models. 

One of the few provinces with a higher search rate is British Columbia, which just so happens to be the only province with a larger average car insurance rate than Ontario (we have the feeling this isn't a coincidence).

As you likely know, luxury comes at a cost. High-end vehicle models cost a pretty penny to purchase, and due to their value, they are more of a risk to insure. Due to the increased risk, car insurance providers in Ontario need to charge luxury vehicle drivers more. In turn, this spikes up the provincial average.

If you're tired of overpaying for car insurance in Ontario, it may be time to look for a new provider. The quickest and easiest way to find affordable quotes from a trustworthy provider is by reaching out to one of our insurance advisors.

At Surex, we work with the very best insurance carriers in order to provide you with personalized car insurance quotes that are bound to exceed your expectations. Contact one of our advisors today to receive ten personalized quotes in ten minutes or less.

High risk of insurance fraud

Insurance fraud is a massive issue in the province of Ontario.

Insurance fraud ranges from staging a car accident to submitting a false claim. When a fraudster successfully fools an insurance provider, it could cost the company thousands of dollars.

In order to recoup their losses, car insurance companies are left with no other choice but to hike up rates. Experts believe that car insurance fraud costs Ontario drivers approximately $236 each year.

Legal fees

In Ontario, drivers have the ability to sue for damages resulting from a car accident or similar event. Depending on the type of car insurance you have, your provider may cover all (or a portion) of your legal fees.

Legal fees can cost insurance companies millions of dollars. In order to recover their losses, they need to increase auto insurance rates.

Factors in Quebec

Car insurance in Quebec tends to be cheaper for the following reasons:

SAAQ coverage

As mentioned above, drivers in Quebec need to acquire car insurance from a sector of the provincial government called the Société de l'assurance automobile du Québec (often shortened to SAAQ).

The SAAQ requires funding through provincial vehicle and license registration fees. The amount you pay for your registration depends on the type of vehicle you drive and the presence of demerit points. Drivers that contribute to this system receive a thorough form of liability coverage, which financially protects them in the event of an accident that results in injury or death (regardless of if they are at fault or not).

SAAQ also occasionally covers expenses related to the following:

• Private healthcare
• Personal in-home assistance
• Medication and supplies
• Funerals
• Social reintegration

Drivers in Quebec should know that this form of liability coverage does have a relatively low limit. That's why many drivers in Quebec opt for additional coverage from a private provider.

Cheaper mandatory coverage

Ontario and Quebec have different requirements for mandatory car insurance coverage.

In Quebec, the following types of insurance are required:

• Property damage
• Civil liability
• Personal injury
• Accident benefits

In contrast, Ontarians are required to purchase more extensive types of insurance:

• Direct compensation property damage (often shortened to DCPD)
• Third-party liability coverage
• Uninsured automobile protection
• Accident benefits

Don't hesitate to reach out to your auto insurance provider for more information about the mandatory types of auto insurance in your province. Your car insurance provider can outline precisely what kinds of coverage you need and any additional types of coverage you may want to include in your policy.