A new survey by rate comparison website RATESDOTCA has found that the majority of Canadians lack insurance literacy when it comes to auto insurance – and that limited understanding could bite them in the form of overpaying for insurance, or being underinsured.
RATESDOTCA found that 42% of Canadians incorrectly believe that comprehensive auto insurance covers everything. Just 34% said they knew this was false, while another 24% said they did not know.
“As Canadian drivers, the more we understand about auto insurance, the more likely we will get the coverage we need at a fair price and avoid disappointment when filing a claim for damages,” commented RATESDOTCA insurance editor Liam Lahey.
The survey additionally revealed that a good portion of drivers are not aware of certain insurance savings opportunities, or have misconceptions about the way their insurance works.
Twenty-five per cent (25%) of the survey’s respondents did not know they could suspend their auto insurance if they are not driving during the COVID-19 pandemic. Only 39% knew they could, while 22% said they did not know.
Sixty-eight per cent (68%) incorrectly assumed that insurers base premiums on the number of demerit points a driver has. Just 10% know that is not the case, while 22% did not know.
Thirty-eight per cent (38%) think the color of their vehicle influences the cost of insurance, when it does not.
Seventy-nine per cent (79%) believe an expensive or high-end car costs more to insure than an economically priced vehicle. Eight per cent (8%) indicated that price is not always a factor, while 13% said they do not know.