You know what they say, "money doesn't grow on trees,".

Ontarians are constantly looking for ways to save money on everyday expenses. Finding ways to reduce regular costs can help you save money for the future and take you another step closer to your next financial goal.

One typical expense that many Ontarians tend to overlook is their auto insurance rates. If you've never thought about how to reduce car insurance rates, be sure to take a look at the list of suggestions our team has put together. If you drive a hybrid, we have more specific information for you here. 

What's the average price of auto insurance in Ontario?

Currently, the average price of auto insurance in Ontario is $1,920 a year. This is a drastic difference from the national average of $1,320 a year.

Additionally, it's worth noting that the city of Toronto has the highest auto rates in the entire country. In Toronto, drivers can expect to pay approximately $2,000 annually for auto insurance.

Why are auto insurance rates higher in Ontario?

There are several reasons why Ontario has the highest auto insurance rates in the country.

Some of these factors include:

• Higher distracted driving rates
• Luxury vehicles are more common than in other provinces
• Extreme weather conditions (particularly in winter)

Check also this post to find FAQs about auto insurance pricing in Canada.

How to reduce my car insurance rates?

We know that the province wants to save money on auto insurance.

That's why you should consider trying out the following tips if you want to learn how to reduce car insurance Ontario:

Go to driving school

If you want to start saving at a young age, you should consider going to driving school.

Not only does driving school help teach you the fundamentals of road safety, but it's also a fantastic opportunity to save on insurance.

Going to a driving school can help you save anywhere from 5% to 15% on your auto insurance (annually). However, it's worth noting that driving school is only available for new drivers that don't have their G2 license.

Install winter tires

Although winter tires aren't required by law in Ontario, they are undoubtedly beneficial (perhaps Ontario should consider following Quebec's lead).

As you likely know, winter tires are imperative during the cold, snowy months of the year. Winter tires utilize a specialized material that's grippier than standard rubber, making them the safer option for slick surfaces, like icy roads. This material becomes even grippier in cold temperatures. 

A study from 2019 states that winter tires helped reduce winter-road-related incidents by approximately 5%.

Many insurance companies see the value of winter tires and encourage drivers to use them by offering a 2% to 5% discount on their annual rates.

So, if you want to learn how to reduce car insurance in Ontario, you can start by installing winter tires.

Drive safely

Although you may not notice a difference in the immediate future, your insurance provider will certainly recognize that you've maintained a spotless driving record.

If you have a clean driving history, your insurance provider will see you as less of a risk than an individual with a marred record.

As an incentive to maintain your pristine driving record, many insurance companies will offer generous discounts on their auto insurance plans, some being as high as 30%.

Reduce overall usage of your vehicle

One of the easiest ways to reduce your car insurance rates is by simply driving less.

Insurance providers consider your overall usage to be a significant factor while determining your rates. This is because if you spend a lot of time on the road, then you're more likely to get into an accident than an occasional driver.

If possible, find opportunities in your everyday routine to cut down on your road time. For instance, if you work close to home, then you may want to consider:

• Taking public transit like a bus or train
• Walking
• Biking
• Carpooling with a co-worker, neighbour, friend or family member

Doing this isn't just beneficial for your bank account; it also positively impacts the environment.

Bundle your policies

One of the most common ways that Ontarians save on car insurance is by bundling their insurance policies.

If you need a refresher, bundling is a term used to describe the purchase of multiple policies from a single provider. An example of this would be purchasing home and auto insurance from the same provider.

Although every insurance company is different, it's not uncommon for Ontarians to save as much as 15% on their insurance when they bundle their policies.

Situational ways to reduce your auto insurance in Ontario

The following tips may not apply to everyone; however, if you spot one that does pertain to you, be sure to reach out to your insurance provider to clarify if you're eligible.

Good student and postsecondary school discounts

These tips go hand-in-hand, as they're both related to students.

Firstly, the good student discount applies to individuals that achieve and maintain an 80% (or higher) average. Students who earn these grades are potentially eligible for a 15% discount.

On a similar note, if your child attends college or university but no longer lives at home, you should reach out to your provider to see if they qualify for the postsecondary school discount.

The postsecondary school discount applies to college and university students that live away from home. If you keep your child on your policy, you can save 50% on their premium.

Many insurance providers understand that your child spends less time on the road while enrolled in postsecondary school. Because of this, we feel like it would be unfair to charge the total price.

Retiree discount

If you've recently retired, you may not know about the retiree discount.

Many insurance providers will offer retired customers a 15% discount on their rates. This is a lucrative discount for any retiree looking to save a chunk of change each year.

Always double-check with your insurance provider

No two insurance companies in Ontario are identical; that's why we always recommend that you double-check which discounts your insurance provider offers and the specific amounts that you'll save.

Doing this will give you a better idea of whether you'd like to stay with your current provider or if it's time to start looking for a new one.