
Ever wonder why your auto insurance rates seem to fluctuate or why you’re paying more than your friend for a similar car? The truth is, there’s a lot more that goes into calculating your premium than just your driving history. As an Insurance Broker with 705 Insurance.
I’ve helped many Ontarians understand the factors that impact their rates. Let’s take a look at the top 10 factors that could affect how much you pay for car insurance in Ontario.
1. Your Driving Record
Short answer: Your driving habits directly affect your insurance costs.
Insurance companies assess your driving history to determine how likely you are to file a claim. If you’ve had tickets, accidents, or a DUI conviction, your rates will likely be higher. A clean record, on the other hand, can help lower your premium.
Example:
If you’ve recently had a minor speeding ticket, your insurance may go up slightly. However, if you've been accident-free for several years, you’ll be rewarded with lower rates.
2. Your Age and Gender
Short answer: Younger drivers and males typically face higher rates.
Statistically, younger drivers and men have higher accident rates. That's why insurance premiums tend to be higher for these groups. As you get older and gain more driving experience, your rates will generally decrease.
Example:
A 19-year-old male driver is likely to pay more than a 45-year-old female driver with the same car because younger drivers are statistically more prone to accidents.
3. The Type of Vehicle You Drive
Short answer: The make, model, and year of your car influence your premium.
Cars that are more expensive to repair, more likely to be stolen, or have a high horsepower tend to have higher premiums. On the other hand, vehicles with advanced safety features or a lower repair cost can help lower your insurance rate.
Example:
A luxury sports car like a Porsche will likely cost more to insure than a practical sedan like a Toyota Corolla due to repair costs and theft risk.
4. Your Location
Short answer: Where you live matters!
Living in an urban area with higher traffic congestion and more accidents will likely increase your rates. Conversely, rural areas with less traffic may result in lower premiums.
Example:
If you live in downtown Toronto, your rates may be higher compared to someone in a smaller town like Collingwood, due to the increased risk of accidents and theft in a busier, more populated area.
5. How Much You Drive (Annual Mileage)
Short answer: The more you drive, the higher the risk of an accident.
If you’re driving your car every day for long distances, your premium is likely to be higher compared to someone who only uses their car occasionally. Insurance companies take into account how much you use your vehicle, as more miles on the road means a higher chance of filing a claim.
Example:
A contractor who drives 30,000 km a year may pay more than someone who only uses their car for the occasional weekend trip.
6. Your Claims History
Short answer: Past claims can lead to higher rates.
If you’ve filed several claims in the past, insurance companies may consider you a higher risk and increase your rates. On the other hand, if you’ve been claim-free for years, you might see a decrease in your premiums.
Example:
If you’ve had two accidents in the last three years, expect your rates to rise as insurers view you as more likely to file another claim.
7. Coverage Type and Deductibles
Short answer: The type of coverage you choose directly impacts your premium.
If you opt for full coverage (collision, comprehensive, etc.), your premium will be higher than if you choose only basic liability coverage. Additionally, the amount of your deductible (the out-of-pocket cost you pay before insurance kicks in) can influence your rates.
Example:
Choosing a higher deductible, say $1,000 instead of $500, can lower your monthly premiums. But be mindful—if you file a claim, you’ll pay more out of pocket.
8. Insurance Company and Discounts
Short answer: Different insurers offer different rates and discounts.
Not all insurance companies use the same criteria or pricing models, so it’s essential to shop around. Some insurers also offer discounts for bundling your home and auto insurance or for having safety features in your car.
Example:
You may find a better rate with one company offering a "safe driver" discount, while another offers a lower rate for having an anti-theft device installed in your car.
9. Your Driving Experience
Short answer: The longer you’ve been driving, the more likely you are to receive a discount.
If you’ve been driving for a long time with a clean record, insurers often reward you with lower rates. New drivers or those with limited experience typically pay higher premiums because they are considered higher risk.
Example:
A seasoned driver with 20 years of experience and no claims is likely to pay less than a new driver, even if they both have the same car and similar coverage.
10. Safety Features and Anti-Theft Devices
Short answer: Safety features can lower your rates.
Having advanced safety features such as automatic emergency braking, lane departure warnings, and anti-theft devices like alarms or GPS tracking can reduce your insurance premiums. These features lower the likelihood of accidents or theft, making your vehicle less risky to insure.
Example:
If your car has a built-in alarm system or a GPS tracker, you might see a discount on your premium because these features reduce the risk of theft.
What are the Best Car Anti theft Devices in 2025? Watch This Video of The 7 Best Car Anti-Theft Devices for Theft Prevention and Peace of Mind!
Understanding the factors that affect your auto insurance rates can help you make informed decisions and potentially save money. From your driving history to the type of vehicle you drive, each element plays a role in determining your premium.
At 705 Insurance, we take the guesswork out of finding the best coverage for your needs. With access to wide range of insurance providers, we compare rates and customize policies to ensure you get the right protection at a competitive price. Whether you're a new driver, have a few claims in your history, or just want to explore better options, we’re here to help.
Let us do the shopping for you—so you can hit the road with confidence, knowing you're protected at the best possible rate
Disclaimer: This blog is for informational purposes only and does not constitute legal or insurance advice. For personalized recommendations, speak with a licensed insurance broker.
Contact 705 Insurance today for a free quote and expert advice on your auto insurance!
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