Valley First

Getting the right auto insurance

Whether you’re buying a new car or simply updating your insurance every year, chances are you’re letting the insurance broker do all the paperwork without fully understanding the fundamentals of auto insurance in British Columbia.

Here’s a quick walkthrough to help you understand the basics of auto insurance so you can get the package that’s right for you.

Basic Auto Insurance Coverage

Every registered vehicle in BC has to get ICBC Basic Autoplan insurance to be on the road. That’s the minimum insurance and it is required by the government.

Basic insurance provides coverage for the following five key areas:

  • Third-party liability: if you’re at fault for a crash and a driver makes a claim against you, covers up to $200,000 of their injury costs and vehicle damage.
  • Accident benefits: covers medicals costs and wage loss for you, your passenger and members of your household up to $150,000 even if you’re at fault.
  • Underinsured Motorist Protection (UMP): if you are not at fault for the crash, covers you up to $1 million if the person responsible doesn’t have enough insurance to pay for the claim.
  • Hit-and-run damage and injuries: available to every BC resident (even if you don’t own a vehicle).
  • Inverse liability protection: covers you in parts of Canada and the US where laws prevent you from filing a claim against the person who caused your crash.

What does $200,000 look like?

When you look at third-party liability coverage, you might think that $200,000 covers a lot. After all, a new Honda Civic costs around $25,000. And in a way, it does. In the US, the minimum for liability is just $50,000.

Now before you start hulking out with envy and decide our friends across the border have it made when it comes to insurance, you need to realize what this lower limit means.

First, if you are found responsible for a crash, you’re more likely to have to pay out of pocket. Second, if you’re not found responsible for a crash, the driver who is at fault might not have enough coverage to pay for your expenses, which means you could have to settle in court.

Suddenly, cheaping out on a monthly payment might not seem as appealing.

If it’s just property damage, the $200,000 covered by third-party liability can be quite low and could easily take care of a small fender-bender.

But if there are more than two vehicles involved in the accident or especially if there are any medical expenses resulting from the accident, costs can easily exceed $200,000, in which case you would be personally responsible.

That is why there are higher liability limits and additional protection that are available through extended optional coverage.

Optional Vehicle Insurance Coverage

The financial impact of a claim can be quite high. For any protection beyond what the Basic Autoplan offers, there is optional coverage available either through ICBC or through a third party like Family Insurance.

  • Extended Third Party Liability increases your basic third party liability limits to $1, $2, $3 or $5 million.
  • Loss of use coverage provides you with a replacement rental vehicle (or reimburses your transportation costs) while your vehicle is being repaired or replaced.
  • Collision insurance covers damage to your vehicle as a result of an impact. It can also cover towing and impound costs. Collision coverage does not cover loss or damage resulting from a mechanical failure.
  • Comprehensive insurance provides coverage for losses or damage to your vehicle caused by something other than a collision, such as theft, vandalism, break-ins, fire, hail, earthquakes, falling or flying objects, etc.
  • Extension Underinsured Motorist Protection increases your UMP coverage to $2 to $5 million.

ICBC and other insurance companies provide packages like RoadStar and RoadSide Plus that bundle some of the most popular products at a lower price.

To get the auto insurance that’s right for you, find an insurance branch near you and speak to one of our brokers.

The Right Autoplan Coverage

Auto insurance does not have that new car smell so it’s a lot harder to get excited about getting the right coverage. But it’s important to make sure that you are protected for how you are using your vehicle.

Most people can absorb a $40,000 loss to a car over their lifetime, but they won’t be able to absorb a $2 or $3 million liability claim.

Insurance exists to make sure that you’re in the same financial situation after a claim that you were in beforehand. You don’t want to cut corners when it comes to getting insurance. You want to make sure you’re protected.

If you still have questions, your best bet really is to visit one of our insurance offices and talk to our insurance experts.

Connect with us:

Talk to us

Whether you’re looking for more information, or you’d like to let us know how we can serve you, you’ll find our contact information here.
We encourage you to visit an insurance expert at any of our locations for more information on how Valley First can make things simple!