6 vital questions to ask when buying car insurance

Although driving a car is a big responsibility, so is insuring it. Here are six vital questions to ask when you buy car insurance that could help protect you and your wallet if you ever need to make a claim.

With so many insurers offering widely different rates and types of coverage, buying car insurance can be complicated: not every insurance company offers the same things. What's more, not every agent will give you what you need to make an informed decision. That's why shopping around is essential to find the right balance between coverage and rates. Here are a six key questions to ask before making a decision on buying car insurance.

There are several different types of insurance available.

Mandatory
Mandatory insurance is dictated by the individual provinces, each of which sets a minimum amount for medical expenses and third-party liability. It's the minimum coverage that is required by law.

Collision
Collision insurance covers the cost of repairs to your car no matter whose fault the accident was. Typically, you’ll pay a set deductible before the insurer pays the rest.

• This type of insurance is a good option if your car is a newer model. Collision insurance is optional.

Comprehensive
Comprehensive insurance covers things that are not accident-related such as theft, fire and vandalism.

• Comprehensive insurance is also optional.

Risk assessment is based on much more than how many speeding tickets you’ve had. Factors include where you live, your age, gender, driving record and credit rating.

• Remember that different agencies will assess your risk (which determines your rate) in different ways.

You’ll need to consider what might happen if your teenage son has an accident, if a friend borrows your car or if you’re driving your car for work purposes.

• Consider who else will be driving your car, and make sure you have the proper coverage so you don't end up with any surprises.

If you have an accident, you’ll almost certainly have to pay something up front. If you can’t afford the deductible, your car won’t get fixed.

• Keep in mind that lower premiums typically carry higher deductibles.

Find out how your clean driving record and the safety features in your car might help you qualify for better rates.

• Features in your car such a having an alarm or ignition kill switch could potentially add up to insurance savings for you.

Ask about what happens after you have an accident and know whether your insurer allows claims to be made 24/7. Otherwise, being in an accident becomes even more stressful.

• A reputable insurance provider will not hesitate to explain how you go about making a claim, if necessary.

It's always a good idea to compare car insurance rates and coverage to ensure you get the right policy. Remember, the cheapest car insurance isn’t always the best.

What's more, before reaching for the phone try getting some online quotes. Many companies offer this service through their website. It'll give you a ballpark figure on cost and the types of insurance offered.

Every driver in Canada must, by law, carry a minimum amount of car insurance. The tricky part is knowing what type of insurance policy to get, so don’t be afraid to shop around and ask a lot of questions.