No-Fault insurance may sound too good to be true and as the old adage goes – if it sounds too good to be true, it probably is. No-Fault insurance was designed as a more efficient way of handling auto claims. Let’s explore the fundamentals of No-Fault insurance in Ontario:

What is no-fault insurance?

No-fault insurance in Ontario doesn’t mean that you can’t be found responsible for a car accident. You will be charged by police if you have been found in violation of the law. In the past, each driver involved in an accident would argue against being at fault and having to pay for damages. This was costly for Ontarians, and it was frustrating for drivers who just wanted to have the claim settled and paid out.

With the No-Fault Insurance, your insurance company will always take responsibility and pay for any covered damage and injuries to you, your car, and your passengers. This system allows insurance companies to focus on what’s most important: getting you and your vehicle back on the road.

How is “fault” determined in Ontario?

Each insurance company will investigate the accident to determine fault. The Fault Determination Rules they will use are province-wide, and all insurance companies must use them. These regulations are laid out by the province’s Insurance Act.  As a driver involved in an accident, you can be found responsible anywhere from zero fault to 100% at fault.

How does no-fault benefit me?

By only having to make a claim with your own insurance company, the claims process becomes simplified allowing for the claim to be settled with lower administrative cost – which means premium savings for you!

Will my insurance premiums increase if I am found not at-fault?

There are several factors that can affect the cost of your car insurance. However, if you are involved in an accident and not found to be at fault, it wouldn’t typically affect your premiums. You may lose a “claims-free discount” or Accident Forgiveness – only if it was offered by your insurer, though.

What is accident forgiveness?

If you’ve been accident-free for the last 6 years (no at-fault or partially-at-fault accidents) and you have accident forgiveness coverage on your policy, insurers will “forgive” you for your first accident. It is a rider that good drivers can add to their car insurance policies to protect themselves from raised rates due to an at-fault accident. This would mean that when your policy renews, your premium won’t be impacted by your at fault accident.

What is the difference between no-fault and at-fault insurance?

In Ontario, your insurance company will handle your claim payout. In a traditional at-fault system, the driver found to be at fault would be responsible for paying for the damages of both drivers! Resolving and settling the damages could take months. The No-Fault system in Ontario allows for everyone to be compensated for their losses quickly.

The No-Fault Insurance was created to simplify the claims process because your insurer deals with your claim. Regardless of fault, you are entitled to be compensated for your losses.

If you’re wondering about coverage and how your policy would respond in the event of an accident, connect with your isure broker today. Be sure to ask about common car insurance discounts that you may already qualify for?

Related articles:
So you’ve just gotten into an accident: Now what?
Four factors that influence your car insurance premiums
Impact of at-fault accident on auto insurance

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