At fault vs not at fault: what each means to your auto insurance rates
If you’re like many Canadians, you’ve probably never given your auto insurance documents a good look. The world of insurance is a confusing one – there are terms you may have never heard before and concepts that you don’t understand.
One of the top questions brokers get asked in Canada is what it means to be at fault or not, and what either one means to your insurance.
At Fault
If you are deemed to be at fault for an accident, it means that, after an investigation by your insurance company, they have determined that your actions were the cause of the accident. Being declared not at fault by the police doesn’t mean that the insurance company will also find you not at fault – in some cases, your insurer can find you at fault even if the police declare the other side (or no side at all) responsible for the incident.
Being found at fault for an accident is not a good thing. It means your insurance company believes that you were not driving as responsibly as you could have been and, as a result, your auto insurance rate will likely increase.
From your insurance company’s point of view, if you’ve caused one accident you’re likely to cause another, making you a riskier client to insure. Unfortunately, this logic can apply even if your insurance company finds you only partially responsible.
Not at fault
Being declared not at fault for an accident by your insurance company means just that – your insurer has decided that the incident was the fault of someone else and that nothing you could have done would have changed the outcome.
Because the accident was not your fault, your insurance company will usually not raise your rates.
In some situations, you may disagree with what your insurance company has decided in terms of at fault vs not at fault. In these cases, you can often appeal the decision. Check with your auto insurance provider for more information regarding deadlines and procedures.
Accident forgiveness
Some insurance companies will offer accident forgiveness. With accident forgiveness, drivers can have one accident without seeing a rise in their auto insurance rates. Don’t be fooled though – if you are found at fault for an accident, it will still appear on your insurance record and, if you decide to switch brokers to one that does not offer accident forgiveness, it could mean bad news for your auto insurance rate. The same is true of ticket forgiveness, which can get you off the hook for one driving violation.