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Vehicles brands with the costliest and cheapest insurance rates in Ontario

When shopping for a car, there are several factors that go into a person’s buying decision: fuel-efficiency, a sensible price, or having the latest comfort and safety features all play a part. Some drivers may also be drawn to certain vehicle brands, and a vehicle’s make does impact car insurance rates “for better or worse.”

How does vehicle brand impact auto insurance rates?

When calculating premiums, car insurance companies take into account several factors, including a person’s age, gender, geographical location, profession, driving history, and past.

But the vehicle itself comes with a range of risk factors. To determine how claims costs for certain makes and models impact auto insurance rates, the Insurance Bureau of Canada (IBC) analyzes four parameters – collision, comprehensive, direct compensation property damage (DCPD), and accident benefit claims costs – using the Canadian Loss Experience Automobile Rating (CLEAR) system.

Insurance providers in some provinces, including Ontario, use the CLEAR system to determine the insurance rates that they charge on certain vehicles. Depending on a particular vehicle’s CLEAR performance, motorists might pay a higher or lower premium due to the potential costs the insurer may likely incur in the event of a claim.

One example that illustrates how the CLEAR system works is a recent study on the cheapest cars to insure in Canada. In the report, the 2009 Dodge Journey SXT 4DR 2WD topped the list of vehicles with the most affordable auto insurance premiums, with rates 43.29% cheaper than the national average. The comparison site says that is because of the vehicle’s performance and lower claims risk.

What is the CLEAR system and how does it work?

The latest CLEAR document, which the IBC also calls the 2020 edition of “How Cars Measure Up,” contains statistics on the number and cost of collision, comprehensive, DCPD, and accident benefit claims for 2001 to 2019 vehicle models, where at least 1,500 of each of the models were insured between 2014 and 2019.

The collision and DCPD ratings are more concerned about the cost of repair for those vehicles in those situations. If you’re in a collision, how much does it cost to fix this make and model of vehicle?

For theft, what is the frequency for this vehicle to be stolen? And if the vehicle is stolen and not recovered — a total loss — the payout can be higher on that. And then you have accident benefits, and that’s injuries.

Pickup trucks often rate well in terms of accident benefits on the CLEAR scale because larger vehicles offer better crash protection than their smaller counterparts. If you’re driving a two-door or a four-door vehicle, you have a greater chance for injury than you do driving a bigger truck, and injury can be a very significant part of claims cost.

Data on vehicle performance can vary year by year, which can affect how IBC calculates overall claims risk. So, just because something had a poor performance in 2020, doesn’t mean it will it have that same poor performance a year later after more data is collected.

While CLEAR data can change, so can those personal factors which also go into calculating your premiums. Maybe you gained driving experience, a traffic conviction disappeared from your record, you moved to a different neighbourhood, or a claim is no longer affecting your insurance rate since your last renewal. If you want to review your policy to see how things may have changed since your last renewal, the brokers and CSRs at DPM Insurance Group are always here to help. Click here to find the office nearest you: https://dpmins.com/locations/



Source: insurancebusinessmag


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