Premiums for auto insurance in Quebec can vary from one insurer to another. For what? In Quebec, it is the Financial Markets Authority (AMF) which is responsible for monitoring the compliance of automobile insurance rates.
Each approved insurer can set its rates, but it must be transparent with the AMF regarding its risk classification rules and premiums applicable to each of these. Result: prices can vary enormously from one company to another.
However, several factors will influence the amount of the premium you will be asked to pay and it is advisable to shop around before making your choice.
What is the basis for setting the premium for car insurance?
The auto insurance premium you pay is established based on several variables:
- the vehicle (type, make, model, year, degree of popularity among thieves, safety rating, cost of repairs, anti-theft equipment, chiseling of main parts, etc.). Contrary to popular belief, the color of the vehicle is not a determining factor (e.g.: red car)
- the use you make of your vehicle (walking, working, etc.)
- your socio-demographic data (district of residence, place of vehicle use, age, sex, profession, education, etc.)
- the coverages and deductibles chosen
- your driving record (number of years of driving experience, type of use of your vehicle, demerit points, behavior on the road, mileage traveled annually)
- your credit report
- all of your automobile claims, whether or not you were responsible for the damage.
Why are insurance premiums increasing?
Two of the biggest factors affecting auto insurance premiums are the significant increase in property damage costs and the number of accidents caused by distracted driving.
A bumper that once cost $1,000 to replace costs much more today, because it contains a multitude of sensors and electronic elements.
The distraction caused by the proliferation of smartphones, electronic tablets, electronic dashboards, GPS, and other entertainment gadgets causes many road accidents.
What are the advantages of using an insurance broker?
You can also work with a broker who deals with several insurance companies. He will inform you about the rates in force in addition to answering your questions concerning your specific case. An insurance broker can be useful if you have a more specific profile
if you have numerous claims on your record in the past, if one or more insurers have canceled your car insurance policy for various reasons, or if you have a criminal record. Again, do not hesitate to ask for all the insurance offers received by your broker and have the differences explained to you.
What is the Central Automobile Claims File (FCSA)?
The Central Automobile Claims File (FCSA), which belongs to the Financial Markets Authority, is managed by the Automobile Insurers Group. It lists the losses each policyholder has been involved in over the past six years, whether there was a claim or not.
Indeed, when you report a car accident or make a claim to your insurer, the latter transmits the information to the FCSA. Since July 1, 1991, this file has been made available to automobile insurers approved in Quebec for information on all automobile accidents in which Quebec drivers have been involved and which have been the subject of an insurance claim.
The information available allows insurers to verify their customers’ declarations when taking out new car insurance. By consulting the file, insurers wish to validate the veracity of the information obtained from the insured, particularly for claims.
Read also: Top 5 Terms to Know About Car Insurance