Car Insurance FAQs: Can You Pause Car Insurance?
Are you driving less than you used to? You’re not alone; several drivers across the country have been spending less time on the road over the past few years. This is due to current events, adjustments within certain industries and general lifestyle changes.
If you’re spending less time driving, then you may have thought about making changes to or even pausing your car insurance policy. This begs the question — can I pause my car insurance, and how does it work?
START A QUOTEWe answer this question, and many more, in the paragraphs below.
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It’s not a secret; car insurance can be quite expensive in Canada, especially in provinces like Ontario. Because of this, some drivers feel like they have to choose between quality coverage and affordable car insurance.
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Can you pause car insurance in Canada?
Yes, many car insurance providers in Canada allow drivers to pause car insurance (some providers will charge a small fee).
Please be aware that you cannot legally drive your vehicle on Canadian roadways if you do not have valid car insurance. This is something you need to keep in mind before deciding whether you’d like to pause your car insurance.
Drivers should also be aware that some car insurance providers do see a voluntary suspension as a form of insurance cancellation. Cancelling your insurance can have serious consequences (we’ll touch on this again later).
How can I put my car insurance on hold in Canada?
Although you technically can’t put your car insurance “on hold”, you are able to pause (or suspend) your car insurance if your provider allows it and you fill out province-specific paperwork.
For instance, in Ontario, drivers need to fill out the following forms if they want to pause their car insurance: Suspension of Coverage (OPCF 16) and Reinstatement of Coverage (OPCF 17).
Suspension of Coverage (OPCF 16) — this document cancels your car insurance coverage until it is officially reinstated.
Reinstatement of Coverage (OPCF 17) — this document officially reinstates your car insurance coverage in Ontario.
Please reach out to a licensed Surex insurance advisor for information on how to pause your insurance in other Canadian provinces.
What happens when you pause your car insurance?
When you pause your car insurance, you lose access to the following components of your car insurance policy: liability coverage, accident benefits, uninsured driver protection and DCDP.
Liability coverage — Coverage that financially protects drivers after injuring/killing a third-party or damaging third-party property.
Accident benefits — Coverage that financially protects drivers after they get injured in a collision.
Uninsured driver protection — Coverage that financially protects drivers after they get into an accident with a third-party who doesn’t have valid auto insurance.
DCDP — Coverage that compensates drivers if they are involved in a crash in which you aren’t deemed at-fault.
What are the pros and cons of pausing your car insurance?
There are pros and cons to every situation, including pausing your car insurance. Here’s a brief look at some of the various benefits and downsides of pausing your car insurance:
Pros of pausing your car insurance in Canada
Here are some of the pros of pausing your car insurance:
Save money while you travel
Do you like to travel for several months out of the year?
If so, pausing your car insurance can help save you money while you’re away. Although it’s not our recommended choice, if done correctly, pausing your car insurance can help you save a significant chunk of change.
Better than cancelling your car insurance outright
Cancelling your car insurance can have huge implications for drivers in Canada.
When you cancel your car insurance outright, you create a gap in your insurance history. Car insurance providers see these gaps as large red flags. In turn, car insurance providers will be less inclined to cover your vehicle in the future.
In contrast, if you work with your insurance provider or advisor to pause your car insurance temporarily, you won’t create this gap.
Cons of pausing your car insurance in Canada
Here are some of the negative aspects of pausing your car insurance:
Applicable fees
Some car insurance providers charge policyholders a fee for pausing their coverage. Drivers should take these fees into account before making a final decision.
Reach out to your insurance provider or advisor to learn what fees you may have to pay when you pause your car insurance in your area.
Vehicle cannot be driven
As we mentioned earlier, you cannot legally drive your vehicle if you don’t have valid auto insurance.
The consequences for driving without auto insurance depend on the frequency and severity of your offence/s.
For instance, in Ontario, drivers that get caught operating a vehicle without valid auto insurance need to pay a fine ranging from $5,000 to $25,000 (along with applicable victim surcharge and court fees).
No protection from off-road events
If you plan to store your vehicle outside, it may not be wise to pause your car insurance. This is particularly true if you already have comprehensive car insurance (a type of insurance that financially protects drivers from events that happen off of the road).
Here’s an example:
A storm occurs and knocks a large branch off of a tree, which falls onto your vehicle. The branch causes extensive amounts of damage to the vehicle’s hood and windshield. If you have comprehensive car insurance, your provider will cover all or a portion of the damages. In contrast, if your car insurance is paused, you will have to pay for the repairs out of pocket.
