If you are involved in an accident and you have no-fault insurance, regardless of who was responsible for the accident, each party submits a claim to their own insurance company. If you are not the party to blame for the accident and you still have to pay a deductible out of your own pocket, your insurance company will seek to recoup this loss from the at fault driver's insurance.
Canadian auto policies have a very good reason for having you protected from third party liability. Liability coverage, that is also referred to as civil liberty or third party coverage, aids in the financial protection you will require if you or another person on your insurance policy, is involved in a motor vehicle accident that is considered to be your fault. In other words, you have caused damage to another persons property or vehicle while driving a vehicle that you own. In circumstances such as this, your insurance company has the liability to the claims against you up to the limit of your policy coverage. Quite often the amount of coverage one has for liability is not adequate to pay the amount that is sometimes court ordered. Many insurance companies will suggest that you carry one million in coverage and if you lease or finance a vehicle, these parties will require that amount.
Coverage for collision aids in paying the expenses incurred if your vehicle should hit another vehicle, or an object like a guard rail, causing damage to your car. Regardless of the amount of collision coverage that you carry, an insurance company will not pay out anymore than the value of your vehicle at the time the accident occurred.
Comprehensive insurance is the coverage that helps with the cost of repairs when your vehicle is damaged due to an unexpected event. These events would fall under the category of vandalism, or a flying object such as something that may come off another vehicle and hit yours. Theft, natural disasters, fire and and damages due to a riot or disturbance are all covered under comprehensive insurance.
Collision and comprehension are not usually considered mandatory but if you should lease or finance a vehicle, it may be required to protect the interest of these parties. A very old car would not be worth the cost of carrying this coverage. Another reason for not carrying these coverages would be if the value of your car can easily be paid for by out of pocket expense if your car is damaged.
All Perils and Specified Perils are two other types of insurance that you may wish to carry. Not meant to replace collision and comprehension, All Perils would include both collision and comprehension as well as insuring your car for loss or damage if it is ever stolen by anyone who lives in your home or a person that you have hired to repair, service, or drive your vehicle. Specified Perils would protect you only against certain situations such as fire, theft, and natural disaster. This kind of coverage is not usually recommended.
An endorsement or rider, which is not always mandatory, is an option by which you have the right to increase or reduce your coverage under some specified situations. A most popular protection under an endorsement would be family protection. The financial protection it provides is significant. If you, or any member of your family, were to be seriously injured or even killed by a motorist that is either uninsured, under insured, or even in the case of a hit and run accident, you would be financially compensated up to the limit of your liability.
An insurance deductible is one that you agree to pay out of pocket for expenses incurred in a motor vehicle accident event. If you were to be involved in an accident and damages cost a total of two thousand dollars, the first five hundred would be required to be covered by you, if that is what your deductible is set at. The higher the deductible you can afford to carry, the lower your insurance premiums will be.
