Across Canada, car insurance rates vary thanks to a multitude of factors, such as the way in which provinces offer insurance coverage to their drivers.
There are both public and privately run insurance programs throughout the country.
For instance, Saskatchewan, Manitoba, and British Columbia rely on provincially run coverage, while the rest of the country uses private insurance through multiple independent insurance companies.
Overall, private insurance coverage has proven to be the most affordable option in Canada, thanks to the competitive nature of the market, which drives lower prices.
Although this is not always the case in all provinces, it is certainly the most effective way to offer insurance coverage overall.
To give you an idea of what insurance rates look like across Canada, here is a breakdown of the most expensive to the least expensive insurance rates within the country.
We’ll also look at some facts about the auto insurance climate within each province.
Alberta – $3151 Average Annual Premium
Alberta car insurance rates are the third most expensive in Canada, experiencing a $300 increase since 2015.
- Insurance expenses only account for 2.7% of disposable income.
- Previously, insurers could only face a rate increase of 5% per year, but this cap was removed in 2019.
Nova Scotia – $2491 Average Annual Premium
Nova Scotians have benefited from lower car insurance rates since reforms in 2003.
Driving history plays a large factor in car insurance rates, and coverage can affect an insurance premium by up to 30%.
- Nova Scotia experiences a lower number of accident claims per year compared to the rest of Canada.
- Nova Scotia rewards safe drivers with lower insurance premiums.
Ontario – $2299 Average Annual Premium
Ontario is one of the most populated provinces in Canada and the second most expensive for auto insurance.
Experts indicate that the main cause of recent rate hikes is the high frequency of claims, lawsuits, and injuries.
- There are also high levels of insurance fraud and organized crime that impact private insurance companies.
- Overall, Ontario’s higher rates can be attributed to the fact that this province has the most drivers in the country.
New Brunswick – $2187 Average Annual Premium
New Brunswick used to enjoy even lower rates, but an increase in claims (largely due to distracted driving) has driven prices in the past few years.
- Auto insurance in New Brunswick accounts for 2.8% of after-tax disposable income – the lowest percentage after Alberta.
- Insurance reforms in New Brunswick maintain premiums on the lower end of the scale and reward safe drivers.
Newfoundland & Labrador – $2162 Average Annual Premium
Even though Newfoundland and Labrador have a comparatively small population, they have experienced some of the biggest rate jumps in the country.
This is because this province operates under the “tort” system, where you can sue an at-fault driver for injuries, lost wages, and other damages.
- Rising rates are largely blamed on an increase in accident claims and vehicle-related lawsuits.
- Newfoundland and Labrador offer only private insurance options, so rates are competitive.
British Columbia – $1775 Average Annual Premium
Coming in with the highest average insurance rates is the province of British Columbia. Their insurance is run by a crown corporation, so there is no comparing rates to save money.
- BC runs a break-even profit system, but operational costs often outdo revenues.
- In the spring of 2021, the Insurance Corporation of British Columbia reduced premiums by around 20%.
Prince Edward Island – $1703 Average Annual Premium
Prince Edward Island relies on private insurance, which has kept rates low for many years.
Plus, PEI has one of the lowest rates of accidents in the nation, so there are fewer claims to pay out.
- PEI has one of the most efficient privatized car insurance systems in Canada.
- Rates remain low due to competition and a decrease in auto insurance claims each year.
Manitoba – $1373 Average Annual Premium
Manitoba operates similarly to British Columbia, with a crown corporation issuing car insurance. Therefore, there is no shopping around for insurance if you don’t like the rates.
- In 2021, the province agreed to reduce auto insurance rates by 8.8%.
- Despite its high insurance rates, it is still considered middle-of-the-road compared to the other Canadian provinces.
Saskatchewan – $1249 Average Annual Premium
Saskatchewan relies on a provincially-run insurance agency, so there is no shopping around in this province as well.
Plus, all drivers are required to carry third-party liability insurance up to $200,000.
- Saskatchewan only takes driving records into consideration when determining rates – they do not consider age, gender, or location.
- A significant portion of Saskatchewan drivers are considered to be underinsured.
Quebec – $1112 Average Annual Premium
Quebec has the least expensive insurance premiums of all the Canadian provinces. Rates are not increasing at the same pace as in other provinces.
Because Quebec’s insurance regulations are not as strict as other provinces, rates remain low.
- The combination of private and public insurance in Quebec allows for additional coverage on top of basic insurance packages.
- The no-fault system for accidents limits liability and reduces the overall cost of insurance.
Why Are Rates So High in 2024?
If you’ve been tracking insurance rates on our site, you may have noticed a significant increase in costs since last year.
Why are insurance rates so high?
Along with inflation, there are a few reasons why car insurance rates have increased this year:
Stolen Vehicles
Canada has seen a concerning rise in car thefts, contributing significantly to the soaring insurance rates in 2024.
The prevalence of organized crime rings targeting specific models for resale or dismantling has driven up insurance claims and subsequently pushed premiums higher for all drivers.
Insurance Fraud
Insurance fraud remains a persistent issue in Canada, adding to the burden of high car insurance rates.
Despite efforts to combat fraud through stricter regulations and enhanced investigative measures, perpetrators continue to exploit system vulnerabilities, raising the cost of insurance for honest drivers.
Repair Costs
The escalating costs of vehicle repairs have become a significant factor contributing to the high car insurance rates.
Advanced technologies incorporated into modern vehicles have made repairs more complex and expensive, with specialized parts and labor driving up overall expenses.
How to Save Money on Your Car Insurance
While you can’t change the average annual premium in the province you call home, there are certain things you can do to lower the cost of your car insurance:
- Increase your claims deductible amount to lower your premiums.
- Consider dropping collision coverage if you own an older car.
- Combine your car insurance with your home insurance.
- Check out usage-based insurance.
- Take a driver’s training course.
- Keep your driving record clean.
- Consider the vehicle you are purchasing since some vehicles are cheaper to insure than others.
- Drive your vehicle less to quality for low-mileage discounts.
If you live in a province with privatized insurance, the most important thing you can do to reduce your rates is to shop around for better insurance rates.
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