People from Canada each and ever year load up their vehicle and travel across the border to visit our neighbour to the south. However, when travelling over the border not everyone knows what coverage they have on their vehicle or how it may impact their insurance. Don’t worry we have you covered!
Family Protection Endorsement
Without a doubt this is the most important portion of your policy when travelling over the border. In most cases, especially if you are insured with McDougall Insurance, you will have this added to your policy no matter what. The family protection endorsement also referred to as the 44 endorsement is an optional add-on to a car insurance policy that protects you and your family if you’re in a collision and the at-fault driver doesn’t have adequate insurance or has no insurance at all. The reason this is especially important when travelling over the border is the mandatory liability limits in the United States are far lower than they are in Canada. This means American drivers aren’t required to have as much coverage for liability claims but with this endorsement it won’t impact you.
Have an Adequate Liability Limit
With regards to the point above the only way the family protection endorsement works is if you yourself have adequate liability insurance. Claims today are resulting in much higher costs and settlements than they ever have before. At McDougall Insurance we quote at least $2,000,000 for liability coverage for all of our clients where applicable. Most companies will only quote $1,000,000, which sounds like a lot of money but believe us when we say it is often not enough. Not to mention to double the amount typically only costs about $25 a year. At that cost it really is a no-brainer. When travelling over the border you can expect the payouts to be even higher which is why we recommended to some of our clients to carry an umbrella policy.
Tickets in the US can Impact Your Record
Transferring information from country to country used to be a difficult task and in the past you used to be able to get a ticket in the United States that would not impact your driving record in Canada. However, thanks to technology and all that fancy stuff you can very well expect a traffic offense to stick with you from most States. Reciprocal agreements have been made by most provinces and states to exchange this information to one another. If your home province and the state you were driving in have an agreement any tickets in that state that you receive will show up on your driving record and can impact your insurance rates. It is important to drive safely and know the rules of the road and the speed limits while driving in the United States.
Accident in the United States
Forget about the liability side, that was covered above. If you’re vehicle is involved in an accident in the US there are a few things you need to be conscious of. First of all, whether you are at-fault for the accident or not you are likely going to have to pay your deductible because the direct compensation portion of your policy does not apply outside of Ontario. Your insurance company will then reimburse you your deductible if you were not at-fault but that will not happen until you are back in Canada. If you don’t have physical damage on your vehicle and are not at-fault for the accident it can be a headache as your insurance company will have to settle with the at-fault parties insurance company before they can reimburse you. If you are at-fault in the accident you can expect it to show up on your driving record and this will impact your rate unless you carry the accident waiver protection.
Rental Car Coverage
If you decide to rent a car in the United Stated you’ll be covered under your Canadian car insurance policy. Although, it is important to note that you may not have all the same coverage you do on your regular policy. Your liability limit will still be applied. However, there is a very poorly titled endorsement you can add to your auto policy called the Liability to Non-Owned Automobiles or the 27 endorsement. What this endorsement does is it transfers the physical damage portion of your policy to the rental car. So if you are in an accident in the rental car you will still have coverage for any damage done to the vehicle. If you are unsure if you have this coverage ask your broker before signing up for the rental car companies optional coverage, we can let you know if you are already covered!
Insurance Premiums May Increase
If you travel to the United States for a significant period of time each year you may be subject to higher insurance premiums. If you’re permanent residence is actually in the United States but you travel to Canada for a significant period of time you will need to have your vehicle registered and insured in the United States.
Make Alternate Arrangements if Travelling To Mexico
Your car insurance policy will not cover you if you drive your vehicle to Mexico. Not to mention that would make for one long road trip! There are certain exceptions but for the most part car insurance in Canada only covers you for driving in Canada and the United States. If you are planning to drive to Mexico you will likely want to investigate using a rental car company that will allow driving in Mexico but it can be costly to do so.
If you have any questions about travelling over the border and how it relates to your car insurance contact your broker. They will be able to advise on what you already have and what may be worthwhile to add.