How Does a License Suspension Affect Car Insurance in Ontario?

Work, family, friends, and daily routines are just a few of the things affected by a driver’s license suspension. Penalties, fines, and reinstatement fees are just some of the added costs a driver can expect.  Once the suspension is lifted and the driver requires insurance, there may be a number of ways his coverage is affected.

Rate Increases

Insurance companies use many factors to determine the cost of insurance and the driver’s record is an important part.  Drivers with license suspensions in their history are usually considered to be high risk. This may increase the cost of insurance significantly. If the driver’s policy is cancelled by the insurance company it may also become difficult to find a new insurer. Insurance companies might deny coverage due to the high risk record of the driver.

Insurability Factors

Every insurance company has different guidelines for determining whether, or not to insure a driver, and what the cost of the coverage will be. The nature of the infractions related to the suspension will affect how an insurer assesses future risk. The reason for and length of the suspension and the company’s policy for this situation are some of the major factors that come into play for the final decision on how to proceed with coverage of a driver.

Loss of Discounts

Over time, many insurance companies offer discounts to drivers when they have a good driving history. In the case of a suspended license, safe driving discounts are almost certainly lost, reducing the cost savings available to the motorist. There may be some discounts that are not affected by suspensions, such as discounts earned through membership in a group with an insurer’s agreement, but since this is a percentage off an individual premium, the suspended driver will pay more than a member with a clean driving record.

Insurers who offer telematics-based coverage may offer discounts to drivers willing to install a small device that collects certain data about how the car is driven. There’s usually a discount applied when the device is installed, and potentially greater discounts when safe driving habits are confirmed based on device data.

Driving History Rehabilitation

driving training

 

There are certain things a driver can do after their license is reinstated to help reduce rates with certain insurance companies, though none are certain or short-term solutions. The best way to ensure low premiums is to maintain a clean driving record over time. The suspended driver may wish to take a government-certified driver training course. Some insurers may offer discounts upon successful completion. At the very least, taking a driver training course may demonstrate sincerity about improving driving habits.

It’s possible that no insurer will issue a regular policy to a driver coming off suspension. For provinces with private insurance, the Facility Association will be able to arrange residual market insurance. Premiums for policies issued to high-risk drivers this way are usually two or three times more expensive than conventional coverage.

Using the QuoteFinder car insurance calculator is an anonymous, no-obligation way to find companies willing to cover a motorist under his current driving history status. Start by entering a postal code and other particulars and QuoteFinder will sort through dozens of insurers to find those willing to issue a policy. Better yet, the calculator will return the most affordable rates for that driver’s record.

2018-09-15T23:21:58+00:00