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Auto insurance terms explained


For explanations of policy coverages please go to our What is covered by auto insurance section

Insurance policy terms and conditions are as stated in the actual insurance policy wordings. Nothing stated herein is intended to modify any part of an insurance policy. If you have a specific question of significance to your situation contact your insurance advisor.

In June 1990, the Ontario government and the industry introduced the concept of "no-fault" insurance.

To many people this suggested that they would no longer pay higher premium if they had an accident. Not so! In fact, under the "no fault" legislation, fault is allocated based on accident scenarios described in the Fault Determination Rules contained in the Ontario Insurance Act Regulation 668. In other words, fault is allocated to each driver based on which accident scenario most closely resembles the accident. According to the legislation, a driver can be 100%, 75%, 50% 25% or 0% at fault. Any driver who is more than 25% at fault will have an "at fault" accident on his or her record and will likely pay a higher insurance premium.

The Insurance Act and the Highway Traffic Act are different legislation, so you may be 100% "at fault" in an accident under the Insurance Act and not get a ticket under the Highway Traffic Act.

"No fault" insurance means you deal with your own insurance company regardless of "fault" for both repairs to your auto and for accident benefits (for details about this important coverage refer to the "Accident Benefits - Mandatory and Optional"). Therefore, choose your insurer wisely because you will have to deal with them if you are injured!

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