When it comes to insurance, Canadians are used to paying some of the highest rates in the world. But what exactly goes into calculating your insurance premiums? And is there anything we can do to help keep costs down?
Here, we will take a closer look at the cost of insurance in Canada, what can influence the rate of your insurance, and ways you can help keep your Canadian insurance cost manageable.
Why Are Insurance Prices In Canada Rising?
Insurance rates in Canada have been on the rise in recent years, there’s no doubt about it.
In fact, a report from the Canadian Institute for Health Information found that the average Canadian family spent $2,393 on health insurance alone in 2015 – an increase of nearly 4% from the year before.
There are a number of factors that contribute to rising insurance costs in Canada, but one of the biggest is the aging population. As more and more baby boomers enter retirement age, they’re using more and more health services – which drives up costs for everyone.
However, the other factors that go into calculating insurance premiums in Canada are not completely out of your control.
Below, are some factors that influence insurance rates. And the good news is that they are within your control to manage.
Shop Around!
The main way to make sure you get the best Canadian insurance that’s right for you is to shop around. Insurance companies all use different criteria when calculating premiums, so it pays off to compare rates from a few different providers before settling on one.
Using a good insurance rate comparison site is the best tool to use when looking for insurance, once you’ve considered all of the above factors, of course. You should also make sure you’re getting all the discounts you qualify for. Many insurers offer discounts for things like having a clean driving record or installing anti-theft devices in your vehicle.
Ask your insurer what discounts are available, and make sure you’re taking advantage of all of them.
Bundling your home and auto insurance can also help lower your rates. Some insurers offer discounts for green living, so it’s worth looking into those options as well.
If you’re a student, you may be able to get a break on your rates as well.
The Value Of Your Belongings Or Property
When it comes to insurance in Canada, the value of your property can play a big role in how much you pay for coverage. If your property is worth more, you can expect to pay higher premiums. This is because insurers see properties with a higher value as being at a greater risk for damage or loss. As such, they charge more to cover them.
For example, items such as fine art and other high-value items would require a higher premium in order to protect them adequately if anything were to happen.
So it’s worth taking into account which items you own that are actually worthy of insurance coverage, or what high-value items you don’t need anymore before purchasing insurance.
Your Claims History
In Canada, insurance companies use your claims history as one of the factors they use to determine your insurance rates.
If you have a history of making claims on your insurance policy, you can expect your rates to be higher than someone who doesn’t have a claims history.
Insurance companies in Canada view customers with a Claims History as a higher risk, and they will charge higher rates to cover that risk.
Your Credit Score
Your credit score has a big influence on your Canadian insurance quote, as well as even being able to claim insurance altogether because companies see people with lower credit scores as high-risk.
For example, experts have noted how 92% of all insurers now consider credit when calculating auto insurance premiums.
