The cost of your insurance has gone up. Now what? Part 1: auto coverage

If you’re like most people, you don’t think about your insurance coverage often. Until something bad happens – or – you notice the cost has gone up. Like any good business, insurance companies want to keep their customers happy. Unfortunately, there are times where factors outside of their control may impact what customers pay.

Thankfully, there are options that can lower the cost of your car insurance. Let’s start by looking at why you may be paying more.

What drives auto insurance rates?

A major impact on today’s car insurance rates is the cost of repairs. Modern vehicles are equipped with more technology than ever – think of all the cameras and sensors built into our bumpers – which means even minor collisions can result in significant repair costs. Distracted driving is also a concern; primarily for the safety and well-being of our communities, and also because it is responsible for an increase in insurance claims.

To top it off, the auto industry was severely impacted by supply chain disruptions during the height of the COVID-19 pandemic, when borders were closed and workplaces were shuttered. But that was only part of the problem. A surge in demand for computers and consumer electronics also led to a shortage of semiconductors—which are used to power a variety of vehicle features—forcing most auto manufacturers to cut production at their plants.

This perfect storm in the auto supply chain has resulted in higher prices, inventory delays, car rental shortages and a spike in car part thefts.

Auto part thefts aside, vehicle thefts on the whole are surging in Canada – particularly in Ontario and Québec. According to a recent report from Équité Association, it’s adding up to more than $1 billion in insurance claims.

Simply put: when insurers pay out more for auto repairs, your costs go up, too.

So, what can you do to keep your insurance costs manageable?

1. Contact your broker if your vehicle usage has changed. This may include:

• Driving less. If you drive less, you may be eligible for a reduced premium.
• Driver training. If a user of your vehicle has taken training, a discount may apply.
• Seasonal parking. If you do not plan on using your vehicle for an extended period of time, contact your broker as you may be eligible for savings.

2. Consider revising your coverage or deductibles.

• Increase your deductible to reduce your annual costs; something to consider if you have a strong driving record and are deemed less likely to experience an at-fault accident.
• Purchase an Accident Waiver. Protect against any premium increase related to an at-fault accident. It will increase your costs in the short term but will offer significant savings in the event you need to file a claim.
• Purchase the Minor Conviction Waiver. Protect against any premium increase related to your first conviction. It will increase your costs in the short term but will offer significant savings in the event you incur a conviction. Subject to regional availability.
• Remove coverage you don’t want or need, such as glass or hail coverage.

3. If your family has more than one insurance policy with Wawanesa, you may be eligible for:

• Multi-Vehicle Discount. This can apply to all vehicles in your household, even if they are in different names or through a different broker.
• Multi-Product Discount. Ask your broker if it’s possible to bundle your policies, such as those for your home, condo or rental.
• Recreational Vehicle Discount. If you’re insuring an All-Terrain Vehicle, Snowmobile, Motorhome, and/or Motorcycle in addition to your car, you may be able to decrease your overall insurance costs.

4. Additional tips:

• Consent to a credit check. In some regions, we offer guaranteed auto insurance premium discounts to members who consent to a credit check. Ask your broker for details.
• Practice safe driving. Strong advice on many levels; one being that convictions and license suspensions can increase premiums.
• Protect your vehicle. Theft or damage can increase your insurance costs. Park in a covered garage if possible, keep doors locked at all times, or install an alarm system if your vehicle does not have an immobilizer.
• Choose the right car. The make, model and year of your car influence your insurance costs, as some are safer than others or are stolen more frequently.
• Add new drivers to your policy. As soon as a driver becomes licensed, they begin building their driving history, which pays off down the road. The longer the insurance history – particularly when crash free – the less the driver will have to pay in the future. While this will cost more in the short term, it will benefit the new driver in the long run. In some regions, young drivers may also qualify for a Drivers Training Credit, Away at School Discount, and/or Good Student Discount.
• Report the use of snow tires. In some regions, this may qualify you for a discount.
• Advise your broker if you are retired. You may be eligible for a discount.

Insurance companies want to make things right for their customers when the unexpected occurs, and work hard to control the impact of our new realities. In the meantime, we encourage you to consider these tips to keep your own auto insurance costs as affordable as possible.

Your Wawanesa Insurance broker is available to help answer your questions and to assist you with managing your coverage.

See also: Part 2: Home Coverage