In addition to buying “optional coverages” for extra protection, you have the option to increase the coverage of some of the mandatory coverages you already have (such as the Liability and Accident Benefits).
Let’s talk about that briefly:
How much insurance do you need?
Bodily Injury Liability
You can buy the minimum required by law: $200,000. Or you can buy limits as high as $1000,000, even $2 million. Remember that someone you hit can sue you for everything you have.
* Tip. If you have a home, own stock and have a decent income, you should probably buy, at minimum, limits of 1 million. If you have more than $300,000 in assets, you should buy higher limits or an umbrella policy. Consult with your professional broker about this!
Property Damage Liability
Several years ago, the $200,000 minimum was considered “more than enough” for this coverage. Not anymore. You should seriously considerat least 2 million of coverage.
In Ontario, the limit you select form “Bodily Injury Liability” will automatically be the same limit you’ll buy for “Property Damage Liability” and for the “Family Protection Coverage” we mentioned in this other article.
Consider how much you can afford to pay to have your car fixed if you have an accident. Auto policies have several deductible options.
* Note. A deductible is the part you pay before the insurance kicks in. You can buy deductibles of $500, even $1,000. The lower the deductible, the more this coverage will cost.
Unless you’re planning to have a lot of accidents, it’s probably a good idea to have a deductible of at least five hundred dollars. (By the way, the “collision deductible” does not apply if someone else hits you and that person is charged “100% at fault” by their insurance company. – If the other person is found only “50% at fault” (as an example), then you would have to pay 50% of your deductible.)
Like collision, there’s a deductible with comprehensive, although it is often lower. For example, if you have a $500 deductible for collision, your comprehensive deductible may be, say, $300.
* Note. While collision and comprehensive will pay for damage or loss to your car, neither coverage will pay for everything on or in your vehicle. Most policies exclude things like CB radios, two-way radios, car phones, cassettes and CDs. – The “contents” of your car, may be covered by your homeowner’s, condo owner’s or renter’s insurance policy … if you have one.
If you add special features to pickups, vans or SUVS, these things probably will be excluded as well. In fact, it’s a good idea for you to talk to your insurance broker about any high-tech equipment or special features you have added to your vehicle. Many, perhaps even most, of these features aren’t covered in the standard policy. It is possible, however, to obtain special coverage for any high-tech equipment or special features your vehicle may have.
Your MIB broker can advise you of the options.