Life doesn’t stop for anybody, as the saying goes, and it certainly won’t stop once you’ve bought an auto insurance policy. Maybe you’re moving into a new home or breaking up with your long-term partner; maybe you’re finally buying that car you’ve had your eye on, or got into an accident over the weekend.
A lot of things can happen in the time between your policy purchase and your renewal date. Some of them could even impact your premium. While your insurance agent might rank low on the list of people you’re excited about reporting life changes to, it’s still important to update them in specific circumstances, since the consequences of not doing so could result in one of several penalties — including having your policy cancelled altogether.
Changes you need to report
According to Aviva Canada and the Financial Services Commission of Ontario (FSCO), the government body that regulates the Ontario insurance industry, you’ll need to update your insurance company if the following happens:
- Your address changes
- You will be changing the way you use the insured vehicle moving forward (e.g., you plan to start using your car commercially — say, if you started driving for Lyft or Uber — or if you switched jobs and will be regularly driving a much longer distance to work)
- More people will be driving the vehicle
- The principal driver of the vehicle changes
- You need to add or remove vehicles to and from your policy
- You are selling the vehicle or transferring the title
- You were receiving an insurance discount due to a qualification you met, but you no longer meet that qualification (e.g., you were receiving a discount for using winter tires, but are no longer using snow tires)
- A driver of the vehicle receives a license suspension
Phil Gibson, Aviva Canada's managing director, personal insurance, recommends that customers notify their insurance agent or broker about any changes they are unsure about — just in case.
Know your rights
In recent months, Canadians across the country have reported that their auto insurance companies cancelled their policies after the companies requested information from them, and they didn’t provide it on time.
According to FSCO, this is perfectly legal. “Policyholders have the responsibility to provide their insurer with updated information when requested,” Malon Edwards, a spokesperson for FSCO, told the Globe and Mail in April. “Failure to provide the requested information within the prescribed period may result in an insurer’s decision to not renew a policy.”
While there are no regulations concerning how much notice insurers have to give their customers when they ask for information, Edwards clarified with LowestRates.ca that if an insurance company decides to terminate your policy, there are several pieces of information that they are legally not permitted to cite as reasons, including:
- Whether you have a physical or mental disability
- Your employment circumstances
- Your income
- Your credit history (this applies to Ontario, other provinces have different rules)
- Whether you have a history of bankruptcy
- The amount of debt you carry
For the full list, you can check out Section 237 (or the “Refusal to Issue Contracts” part) of the Insurance Act.