A Full Guide to Temporary Car Insurance – Ontario
Car insurance is an excellent solution to protect car owners in case of accidents or unexpected events. Insured drivers don’t have to worry about any damage or loss to their vehicles since the insurance company will cover the costs. However, most insurance policies are a 1-year commitment, which can be inconvenient in some cases. Paying a monthly premium for a year is unnecessary when you only drive the car for a short time. In this blog, we answer all your questions about temporary car insurance in Ontario and Canada.
Who Needs Temporary Car Insurance?
We all lead different lifestyles with different driving habits. Some car owners may not need to have their cars insured for 12 months. For example, a person visiting Canada for a few weeks or months still needs car insurance during their stay. Another case is when someone is transferring the ownership of their car with the license plate being used short term.
Some people buy vehicles seasonally, like vintage cars or motorcycles, to drive for a few months. Also, students who only stay in the province during summer don’t need full-term insurance coverage.
Lastly, as of late, families purchase trailers or RVs to take on road trips during their vacations. In all these cases, the car owners benefit more from temporary insurance than a full-term insurance plan.
Is Temporary Car Insurance Available in Ontario?
Ontario has some of the strictest driving regulations in all of Canada. That’s why Ontario insurance companies aren’t allowed to offer temporary car insurance policies.
The lack of temporary insurance options is partly due to the province’s emphasis on comprehensive insurance coverage to ensure that drivers are fully protected, even if they are on the road for a short period.
Some companies offer a 6-month term instead of an annual car insurance policy for car insurance, but only very few car insurance providers offer that option in Ontario.
Alternative Solutions for Short-Term Car Insurance in Ontario
While temporary car insurance isn’t available in Ontario, you still have a few options for short-term car insurance. Here are some of the options if you can’t get temporary car insurance:
1. Cancel Your Insurance Policy Early
While it’s not advisable because of expensive cancellation fees, you could cancel your 12-month-long insurance policy when you no longer need it. That way, you don’t have to pay the monthly premiums.
We also advise you not to stop paying the premiums without canceling as that may lead to a lapsed car insurance. If your car insurance lapses for non-payment, you will be considered a high-risk driver which may make it harder for you to get good insurance down the line.
2. Get a Special Permit
If you’re visiting Ontario for less than 10 days, you could get a special permit. It allows you to drive an unregistered car in the province for up to 10 days. This applies to any car that was registered outside Ontario. Drivers use those options when they’re importing or transporting a car but don’t intend to stay in Ontario.
For new residents in Ontario who recently bought a car, they have 30 days to register that car in Ontario. Note that passenger vehicles can only get a special permit twice per 12 months.
Here’s what you need to get the permit:
- Proof of identity, like an ID or driver’s license
- The current vehicle permit
- The back of the vehicle permit signed by the car owner
- Name of the temporary insurance provider and policy number
- A completed special permit application
3. Rent a Car for Temporary Stay
If you’re visiting Ontario for a short time, you might rent a car instead of driving your own. This will save you the trouble of having to insure the car in Ontario. You just have to get rental car insurance and chances are you already have one. You could have it through your car insurance, or credit card as a complementary coverage. In many cases, you could have it included through your travel insurance coverage.
4. Add Teen Driver to Your Insurance
If your child comes home from school to Ontario 3-4 months per year and doesn’t need a full 12-month-long car insurance policy, this option is for you. Instead of the child insuring their car, you can add them to your car insurance where they can drive your car or family member’s car instead.
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5. Downgrade Your Insurance Coverage
If you don’t use your car most of the year and keep it in storage, you don’t need full coverage car insurance. To save on your premium amount, consider getting minimum car insurance, removing any coverage you don’t need, or getting storage insurance.
Can I Drive My Car Without Insurance in Ontario?
It’s illegal to drive on public roads without car insurance in Ontario. This requirement is part of the province’s compulsory automobile insurance regulations. Before driving the car, you need to get the minimum required insurance, obtain a temporary permit, and then register your car.
The Minimum Required Car Insurance in Ontario
Ontario laws require car owners to hold a minimum of $200,000 in third-party liability coverage. Other required coverages include accident benefits and uninsured motorist coverage. Direct compensation – Property damage (DC-PD) coverage was obligatory up until January 2024, now it’s optional. These are the minimum requirements that you can increase to get more protection. Learn more about standard car insurance policies here.
Temporary Car Insurance Options in Canada
While temporary insurance isn’t available in Ontario, it’s available in most provinces. Each province has its own rules when it comes to short-term car insurance. Let’s take a look at short-term car insurance options in each province.
Alberta
There are no options to purchase temporary car insurance in Alberta. If you’re visiting briefly, you can get a special in-transit permit for up to 14 days with an existing licence plate and registration. This doesn’t include car insurance. The minimum insurance term in Alberta is 6 months.
Quebec
The public provincial insurance system in Quebec offers temporary insurance permits ranging from 12 hours up to one month. They can be issued by SAAQ (la Société de l’assurance du Québec) but insurance companies can’t offer them for less than six months.
Nova Scotia
In Nova Scotia, only a few insurers offer temporary car insurance policies. Car owners need to buy either 6 month or 12-month policies. Cancelling the car insurance policy early is an option but not all insurers offer refunds.
New Brunswick
Like Nova Scotia, you can get temporary car insurance in New Brunswick, but it can’t be less than 6 months. Cancellation is an option, but you may have to pay cancellation fees.
Manitoba
In Manitoba, you can get temporary car insurance with a permit that is valid for up to 30 days. This permit, which you can get through the local public insurance sites, includes basic and optional coverage with a 5% surcharge on top of it. If you are a resident of Manitoba, you get a limit of three permits per vehicle per year.
British Columbia
In British Columbia, you can get temporary TOP permit for one up to 15 days, or one for 3 to 11 months. The latter will insure an automobile you plan to use for test driving, transporting or transferring ownership. If you want to, you could add extra protection from a private insurer.
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Saskatchewan
Saskatchewan allows you to get daily or weekly car insurance permit starting from 24 hours to 8 days on an unregistered vehicle. This permit provides coverage when you’re on the road inside the province. A 24-hour temporary car insurance coverage costs $24, while an eight-hour permit costs $48.
What Do You Need to Get Temporary Car Insurance?
If you live in a province that offers temporary car insurance, follow these steps:
- Prepare your driver information, as well as vehicle information.
- Be ready with the duration you need the temporary auto insurance, the level of protection, and if you need any additional coverage.
- Do research to find out what Ontario insurance providers offer temporary insurance.
- Compare rates and find the most suitable option for the duration you need. You may find temporary car insurance plans that offer long-term options for lower costs.
- Choose a temporary insurance policy that meets your requirements and contact the insurance provider.
What is the Average Temporary Car Insurance Cost in Canada?
Temporary car insurance in Canada can cost a lot depending on the province, level of coverage, duration of the policy and the driver.
Generally, temporary insurance is more expensive per day than an annual policy. For example, you can expect to pay anywhere from $15 to $25 per day for basic coverage and more if you need collision or comprehensive coverage.
For a 1-week policy, the cost can be $100 to $200 and for a 1-month policy $300 to $700 depending on the above factors.
Can I Pause My Car Insurance in Canada?
In Canada, you can’t “pause” your car insurance because of the legal requirement to have insurance on all registered and operational vehicles. But there are a few options to reduce your insurance costs if your vehicle will be out of use for a long time:
Suspend Certain Coverages
In some provinces like Ontario, you can suspend parts of your policy using forms like OPCF 16 (to suspend) and OPCF 17 (to reinstate). This will remove liability, accident benefits and uninsured motorist coverages, so your vehicle won’t be protected against driving risks but you can still have coverage for non-driving perils like theft or fire through comprehensive insurance. Checkout: Do You Need Accident Insurance For Your Child?
Comprehensive-Only Coverage
Another option is to reduce your coverage to “comprehensive-only” or “parked vehicle” coverage. This will keep your car protected from risks like theft, vandalism or weather damage while it’s not being driven but will significantly reduce your premiums compared to full coverage.
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Cancellation and Reinstatement
The only way to stop payments completely is to cancel your insurance policy, but this is generally not recommended as there are penalties, fees and it will negatively impact your insurance history which will lead to higher premiums in the future.
When Shouldn’t I Get Temporary Car Insurance?
Temporary insurance is for when you need short-term car insurance only. You can’t get temporary insurance for your car if you’re driving a rented or hired car. In those cases, you will need rental car insurance or hire insurance.
A temporary car insurance policy won’t also cover you if you’re using your vehicle for hire or reward, like operating it as a taxi. In that case, you need taxi insurance.
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