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Auto Insurance

Auto Insurance

What is auto insurance?

What is car insurance? Learn about your car insurance and what it covers in this article.


Understanding car insurance: the basics


Car or auto insurance is a contract between you and an insurance company that protects you from financial losses in the event of an accident or theft. In exchange for paying your premiums, the insurance company agrees to pay for your losses as described in your policy.


The coverage provided by auto insurance includes:

  • Property, such as damage to or theft of your car.

  • Liability-personal injury or damage to others caused by you

  • Legal Liability for Medical Property-Injury treatment, rehabilitation, and sometimes lost wages and funeral expenses.

Basic personal auto insurance is required in most provinces in Canada, and the laws vary.


The car insurance coverage is priced separately (a la carte), allowing you to customize the insurance amount to meet your exact needs and budget. The policy is usually issued for six months or one year, and it can be renewed. Read more.


The insurance company will send notifications when it needs to update the policy and pay your premiums.


Who and under what circumstances does my auto insurance cover?


Your car policy will cover you and other family members on the policy, whether it is another person's car (with your permission). If someone who is not on your policy drives your car with your consent, your policy will also provide coverage.

Your personal car insurance policy only covers personal driving, whether you are commuting, running errands or traveling. If you use your car for commercial purposes, for example, if you deliver pizza, it will not provide coverage.

If you use your own car to provide transportation to others through ride-sharing services such as Uber or Lyft, personal car insurance also does not provide coverage. However, some auto insurance companies now offer additional insurance products (extra charges) to expand coverage for car owners who provide carpooling services. Is car insurance mandatory? Auto insurance requirements vary from province to province.


If you are financing a car, your lender may also have its own requirements. Almost all provinces require car owners to carry:

Personal injury liability insurance, which covers expenses related to injury or death caused by you or another driver while driving your car, another car or other property, such as fences, buildings, or telephone poles.


What other types of car insurance are typical?

Although the most basic and legally required car insurance covers damage caused by your car, it does not cover damage to your own car. To insure your own car, you should consider the following optional coverage: When you are at fault, collision compensation for damage to your car caused by a collision with another car or other objects (such as trees or railings). Although collision insurance will not compensate your car for mechanical failure or normal wear and tear, it will cover damage caused by potholes or rolling cars. Such as fire, flood, vandalism, hail, falling rocks or trees and other dangers, even being hit by an asteroid!


Glass covering provides coverage for damage to the windshield, which is very common. Some car policies include deductible glass insurance, which also includes side windows, rear windows, and glass sunroofs. Or you can purchase supplementary glass cover.


What is gap insurance and do I need it?

Collision and comprehensive insurance protection only covers the market value of your vehicle, not the price you pay for the vehicle, and the amount it depreciates. If your new vehicle is totalled or stolen, there may be a gap between the depreciated value of your vehicle and what you still owe on the vehicle. When buying a new vehicle consider purchasing gap insurance to cover the insurance difference. Remember, for leased vehicles, the insurance difference is usually included in your lease payment. Contact Ted Yan, your trusted Calgary auto insurance expert, today.

Read your car insurance policy.
Does it cover these?


  • Liability coverage to one or two million?

  • Collision and comprehensive?

  • Windshield replacement?

  • A deductible you can afford?

  • Gap insurance?

Calgary Auto Insurance

Ted Yan offers Calgary auto insurance.
He can offer you great insurance for your car.  Click here.

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