Car Insurance Types

You know you need car insurance to drive in Canada, but the amount of terminology is daunting to someone who is picking up their first auto insurance policy. Instead of getting lost in a sea of technical terms, you want to start at the beginning to understand exactly what your responsibilities are as a driver when it comes to insurance and what each type of insurance provides you with.


The first order of business is picking up liability insurance for your vehicle. Every province in Canada requires this coverage, as it pays a claim to the person you get into an accident with and their passengers. Their property and bodily harm are covered with this part of the policy.

Accident Benefits

Accident benefits is another part of required coverage in Canada that has your insurance company pay you a portion of your wages while you recover from injuries related to the car accident. Depending on the severity of the accident, you may be unable to work for a significant period of time. This could lead to disaster if you don’t have this coverage, so it’s useful even if it didn’t happen to be legally mandated across the country.

Bodily Injury and Optional Insurance

The final portion of required coverage is bodily injury coverage, which takes care of any medical bills that aren’t already handled by other portions of the policy or the other involved party. Outside of these parts of the policy, you have two other insurance types you can add. Collision covers damage to your vehicle due to collisions with other vehicles or objects. Comprehensive coverage handles every type of potential damage source to your vehicle that isn’t already covered by other portions of insurance, such as a tree falling on your car roof. These aren’t required types of insurance, but if you have a new car, it’s well worth keeping around so you can get it back up to speed quickly after an accident or another incident.