No-fault insurance may sound too good to be accurate, and as the adage goes – if it sounds too good to be true, it probably is. No-fault insurance is a more efficient way of handling auto claims. So, what exactly is no-fault insurance? How can it benefit the consumer? How does it differentiate from at-fault insurance? Luckily, isure has everything you need to know! Let’s explore the fundamentals of No-fault insurance in Ontario.
What is no-fault insurance?
No-fault insurance is, for the most part, precisely what it sounds like. However, there are some catches. No-fault insurance in Ontario doesn’t mean that you can’t be found responsible for a car accident. You will face charges if you violate the law. In the past, each driver involved in an accident could argue against being at fault and having to pay for damages. This was costly for Ontarians and frustrating for drivers who just wanted to settle the claim for a payout. With this type of insurance, your insurance company will always take responsibility and pay for any damages and injuries to you, your car, or any passengers in the vehicle at the time of the accident. This system allows insurance companies to focus on what’s most important: getting you and your vehicle back on the road.
How does this benefit me?
One of the main benefits of no-fault insurance is the ability to simplify your claim. The claims process becomes much smaller by only having to claim within your insurance company. It also simplifies by allowing for a claim settlement with lower administrative costs. This means premium savings for you!
How do we determine “fault” 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. The province’s Insurance Act lays out these regulations. As a driver in an accident, you can be found responsible anywhere from zero fault to 100% at fault.
Several factors can affect the cost of your car insurance. However, it won’t typically affect your premiums if you are in an accident and not at fault. You may lose a “claims-free discount” or Accident Forgiveness. With this in mind, this would only be the case if your insurer offered it.
What is accident forgiveness?
If you’ve been accident-free for the last six years (no at-fault or partially at-fault accidents) and 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 rising rates due to an at-fault accident. This means that when your policy renews, your premium won’t feel an impact from your at-fault accident.
What is the difference between no-fault and at-fault insurance?
In Ontario, your insurance company will pay your claim. In a traditional at-fault system, the driver found to be at fault would be responsible for paying for the damages to both drivers! Resolving and settling the damages could take months. The No-Fault system in Ontario allows everyone to receive compensation for their losses quickly. No-Fault Insurance aims to simplify the claims process because your insurer deals with your claim. Regardless of fault, you are entitled to compensation 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 typical car insurance discounts you may already qualify for! Contact us at isure or request a quote today!
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