Uninsured Automobile Coverage: What It Is and How It Works in Canada
TL;DR: What is uninsured automobile coverage?
Uninsured automobile coverage is a mandatory type of car insurance in Ontario that may help to cover medical expenses, funeral costs, or vehicle repairs if you, a family member, or a passenger are injured or killed by an uninsured or unidentified at-fault driver, or if your property is damaged by an identified uninsured driver.
Uninsured drivers vs. underinsured and unidentified drivers
Before diving into the details of how uninsured automobile insurance works, it’s important to define the terms “uninsured,” “underinsured,” and “unidentified.” Uninsured automobile coverage may cover collisions with all three types of driver, but they’re slightly different and may impact how your coverage applies.
- An uninsured driver has no auto insurance coverage whatsoever and is driving in violation of Canadian law.
- An underinsured driver has auto insurance, but their third-party liability limits are insufficient to cover all the injuries they’re responsible for. These drivers often carry just the legal minimum required in their province (e.g., $200,000 in Ontario).
- An unidentified driver, also known as a hit-and-run driver, is an at-fault driver who leaves the scene of an accident without stopping to share their personal and insurance information with others involved in the crash.
In Canada, vehicle insurance is assigned to an insured vehicle, not the driver behind the wheel. Always make sure that any vehicle you drive has proper insurance, even if you have your own valid policy.
What uninsured automobile coverage covers
Uninsured automobile coverage may pay for medical bills, funeral costs, vehicle repairs, and other expenses that aren’t paid for by your mandatory no-fault accident benefits.
Accident benefits are always the first line of coverage for medical costs, rehabilitation, lost wages, and other personal expenses after a collision, regardless of who’s at fault.
Under Ontario’s Insurance Act, medical and rehabilitation accident benefits are subject to the following limits:
- Minor injuries: $3,500 limit for minor injuries
- Injuries that exceed the definition of “minor” without meeting the threshold for catastrophic injury: $65,000
- Catastrophic injuries: $1 million
Uninsured automobile coverage comes into play when your accident benefits coverage isn’t enough to cover all your expenses. At this point, the at-fault driver’s third-party liability coverage would normally help to cover your additional expenses—but if the driver was uninsured or operating an uninsured vehicle, your uninsured automobile coverage will kick in instead.
How much uninsured automobile coverage do you need?
By default, uninsured automobile coverage pays up to $25,000, minus a $300 deductible.
Uninsured automobile coverage follows different rules for bodily injury and property damage:
- Bodily injury is covered if the at-fault vehicle was uninsured or unidentified.
- Property damage is covered only if the at-fault vehicle was uninsured.
Extending your coverage limits to include underinsured motorists
The standard uninsured automobile insurance included in all auto insurance policies in Ontario only covers up to $25,000, less a $300 deductible, and won’t cover the difference between your expenses and the at-fault driver’s liability coverage.
To increase your limits and get covered against car accidents involving underinsured drivers, you must use Family Protection Coverage (OPCF 44R). If you or a family member is injured or killed in a motor vehicle accident with an “inadequately insured driver,” OPCF 44R means that anything not paid for by the at-fault driver’s insurance will be covered by your own insurer up to your own policy’s liability limits.
Let’s look at an example. Say you’re seriously injured in a car accident and incur a total of $500,000 in medical bills due to another driver’s negligence. You have $1 million in third-party liability coverage, but the other driver only carries the provincial minimum of $200,000.
- Your accident benefits pay for $65,000 of the medical costs not covered by provincial healthcare.
- The other driver’s mandatory third-party liability coverage comes through with an additional $200,000.
- You’re left with $235,000 in unpaid medical bills—but because the other driver only carried the minimum limits for liability coverage, their insurance company won’t pay any more.
- Worse still, the at-fault driver chose to stick with minimum coverage in the first place because they’re short on cash, so they have no way of paying the remaining $235,000 they’re responsible for.
Without the Family Protection endorsement, you’d be stuck covering your costs without help from either insurance company.
With the Family Protection endorsement, you could claim the remaining $235,000 from your own insurance company through your $1 million liability policy.
OPCF 44R is technically optional coverage, and it will add a small amount (usually less than $50/year) to your insurance premiums. But because it’s such a powerful addition to your coverage, most insurance companies will strongly encourage you to add this endorsement.
When you request home or auto insurance quotes with PolicyMe, you’ll have the opportunity to speak with a licensed insurance advisor who can answer coverage questions like this and make sure your family has the right protection at the right price.
What happens if an uninsured driver causes a collision?
If an uninsured driver is found fully or partially at fault for a collision using Ontario’s Fault Determination Rules, the injured party’s uninsured motorist coverage will pay for medical expenses not covered by public health care or accident benefits. If the crash caused property damage, uninsured automobile insurance may also cover all or part of the repair costs.
Are you covered?
How to file a claim after an accident with an uninsured driver
If you or a family member or passenger has been injured in a crash caused by an unidentified automobile or a driver with no insurance, reach out to your insurance company immediately to report the crash and file a claim.
Your insurance advisor will help you determine which coverage on your policy applies and in what order. Your accident benefits will be the first line of coverage, but you may need to submit an uninsured motorist claim once accident benefits are exhausted.
Be prepared to provide:
- Your description of the accident along with any photo or video evidence from the scene
- Photos and videos documenting your injuries
- Medical bills and invoices
Is uninsured automobile coverage mandatory?
Uninsured automobile coverage is mandatory in most Canadian provinces, although the details of how the coverage works may vary depending on local regulations. Alberta is the only province that does not require uninsured motorist coverage.
In Ontario, all motorists must carry uninsured automobile coverage and are encouraged to raise this coverage to match their own liability limits using the optional Family Protection endorsement.
While it’s hard to nail down the exact number of uninsured motorists on Ontario’s roads, Ontario Provincial Police (OPP) data suggest that the number is rising. The risk of a collision with an uninsured driver may be greatest in high cost of living (HCOL) areas like the Greater Toronto Area, where motorists may choose to risk the $5,000 uninsured driver fine in order to lower their routine living expenses.
FAQ: Uninsured automobile coverage
This article is for general information only and is not insurance or legal advice. Examples and any sample quotes or rate ranges are illustrative and do not constitute an offer or guarantee of coverage, price, or eligibility. Actual coverage, discounts, and premiums depend on your individual circumstances and the insurer provider; if there is any discrepancy, your policy and insurer documentation govern. For advice about your situation, speak with one of our licensed insurance professionals.