Auto insurance in Ontario is more than a legal formality. It acts as a financial safety net that protects you, your passengers, and others on the road. While all drivers must carry insurance by law, many do not understand what coverage is mandatory or what each component provides. Ontario’s auto insurance system can seem complex, especially for new drivers or those unfamiliar with its no-fault structure. Knowing which coverages are required helps ensure compliance and avoids unexpected expenses after a collision. Here, we explain the legally required coverages and what each means for Ontario drivers.
Ontario uses a no-fault insurance model. After an accident, each driver claims damages and medical expenses through their own insurance provider, regardless of who caused the collision. This system allows for quicker processing of claims and reduces the need for legal disputes. However, all drivers must still carry certain types of coverage to meet the province’s legal standards.
Third-party liability coverage protects you financially if you cause injury, death, or property damage to another person while operating a vehicle. It includes:
Ontario law requires a minimum of $200,000 in third-party liability coverage. However, this minimum may not be enough to cover serious claims.
Statutory accident benefits provide compensation for medical costs, lost income, and other expenses related to injuries sustained in a collision. These benefits apply regardless of fault. The coverage includes:
Ontario’s minimum benefits include $65,000 in medical and rehabilitation coverage for non-catastrophic injuries, and up to $1 million for catastrophic injuries. Optional upgrades are available to increase these limits.
DCPD applies when another driver causes damage to your vehicle, and they hold valid insurance from a licensed Ontario insurer. Instead of pursuing their insurer, you make a claim with your own provider. DCPD covers:
DCPD only applies if the collision occurs in Ontario, involves at least two vehicles, and the at-fault driver has Ontario insurance. As of 2024, Ontario drivers may opt out of DCPD coverage using an OPCF 49 form. While this may reduce premiums, opting out removes your right to claim for damages even when you are not at fault. This decision should involve serious consideration, especially for those who lease or finance their vehicle, as lenders often require full coverage.
Mandatory coverages form the legal minimum. However, adding optional coverage increases protection and limits out-of-pocket expenses. These include:
Drivers with loans or leases often must carry collision and comprehensive coverage. Even without such requirements, optional insurance provides peace of mind and stronger protection.
Driving without valid auto insurance is illegal in Ontario and can result in:
These penalties not only carry legal consequences but may also lead to long-term financial hardship.
Choosing appropriate coverage requires a review of personal needs, vehicle value, and risk exposure. Consulting a licensed insurance broker can help:
Our auto insurance brokers understand current market rates and can recommend policies that match your lifestyle, driving habits, and financial goals. To know the different types of auto insurance in Ontario, contact us.