Best Tips to Get Affordable Insurance in Canada

Many Americans move to Canada every year, for various reasons such as political, to improve social circumstances, for better health care, perceived tax advantages or due to job assignments and educational opportunities.

What Is Involved With Relocating to Canada?

Moving or relocating to Canada involves numerous steps, one of which is planning an international move. One of the things you might need to look into when planning your move is the insurance. Here are 5 things that may help you to understand the different kinds of insurance in Canada, including healthcare, and how to find the insurance coverage you need at a good price before you get there.

How to Get Discounts on Insurance When Moving to Canada

Person Moving or Relocating to Canada Unpacking
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The best way to save money when you move to Canada is to plan ahead.  

2 Things to Provide When Getting Quotes on Canadian Insurance

Before you leave your home country, you will be able to obtain the most favorable rates and get the most discounts if you get the following:

  • A letter of claims experience
  • Proof of a strong credit rating

How Discounts Work for Canadian Insurance

Discounts work very similarly in Canada as they do in the U.S.A. You can expect to find many of the same insurance discounts you had at home when you move. 

  • If you are moving to an area of Canada where there is heavy snowfall, bringing the letter of experience from the USA or an area that also has winter driving conditions can help you save money on the car insurance because it shows the new insurance company that you have experience driving in tough winter climates. Make sure and ask the new insurance company what kind of driving record they are giving you, ideally, you want to be able to qualify for a 6 year or more claims free driving record discount. The letter of experience will help you get this. You may also have requirements for your driver's license, we cover this in point number 5 below.
  • Be sure and ask for discounts for insuring your home and car together, your education, and a claims-free discount if you have been insured in your country and not had any claims. The letter of claims experience will also ensure you get that on your home. Claims free discounts on homes can add up to 25 percent or more, so it is well worth being prepared. 
  • You can also save money if the insurance company you are getting quotes with is willing to recognize a good credit rating and give you a discount for it. Although not all companies will necessarily apply this rating factor in insurance, many will give 30-50 percent off the rates when a client has a good credit rating combined with the factors of the new area they will live in. It is worth asking about and doing what you can to bring your credit history with you. Sometimes the insurance company has ways to check U.S. credit ratings on their own, so you will not need the letter if they can get it with your authorization, but it is worth asking if they applied a discount for your good credit so you know if you need to negotiate or bring anything extra with you.

Where to Get Insurance If You're Moving to Canada

Couple looking at insurance options online moving to Canada
You can find a lot of the information you need for your move to Canada online. damircudic / Getty Images

In Canada, you can obtain insurance in several ways, just like you can in the United States.

  • From an insurance broker: this gives you an advantage in being able to call one place and get guided advice from an insurance professional who is familiar with several insurance company rates in the area you are moving to. This can be a huge advantage if you would like some help and guidance to make the transition as easy as possible. A broker who works for a firm that has access to home, car, health and travel insurance is a great option for one stop shopping and should be an option to consider.

Independent Brokers vs Brokers Who Have Majority Stakes With Insurers: What You Need to Know

If you want the widest variety of options, look for a broker who has access to several insurance companies, not just one or two. You should ask if they are independent brokers or if they are owned in majority by an insurance company, or have the majority of their business with one carrier. When an insurance broker is owned partly by an insurance company, it makes sense that their expertise may lean towards that insurance company, and this may not serve you as well as an independent broker, who has no obligation to the insurance company and is free to place business without financial obligation to insurance companies. You can learn more about insurance brokers in Canada at the Insurance Brokers Association of Canada website.

  • From an insurance agent: just like in the United States, there are licensed agents who represent one insurance company. This means their licensing and knowledge is limited to one insurance company. They will likely be able to offer you a decent price, but will not be able to discuss other market options or other insurance company possibilities. An example of an insurance agent would be an Allstate representative.

How to Choose an Insurance Company or Representative

In the same way that the USA uses AM Best Ratings and Standard and Poors for indications of insurance company strengths, Canadian companies have similar ratings. This indicates the financial strength of the insurance company.

You can also check independent surveys, like the best car insurance for claims and customer satisfaction in the U.S. where there is also information from the same kind of survey by J.D. Power for Canadian Insurance customer and claims experiences. You may find that using surveys like these help you compare what the consumer experiences are, instead of just looking at a company's financial strength. Consumer experiences with insurance companies vary from location to location.

The Insurance Company vs. the Representative

Aside from researching your insurer's reputation, it is equally important to research the financial services firm you are purchasing insurance from. It's a good idea to find out how long they have been in business, how many employees they have, and how long the average employee is staying with the firm. A few simple questions to the person you are buying insurance from can ease your mind, or let you in on potential stability issues with the firm. It all depends on your needs and buying style, and in the end, you want to make sure you are comfortable with the person you decide to entrust your insurance coverage to.

Finding Help With Insurance in Canada

A great resource for information geared at helping consumers is The Insurance Bureau of Canada, they have offices in every province and can help you understand anything you might need help with. They can also help you if you have trouble finding insurance, or guide you if you are experiencing problems in a claim, or other circumstance.

5 Things to Find Out About Your Insurance Provider When You're Moving

rebuilding a home with building blocks insurance dwelling values
Is the insurance company increasing your dwelling value? What to do if you disagree. dblight / Getty Images

Here is a list of 5 things that will help you evaluate if the insurance you are choosing is a good fit for your lifestyle, needs, and expectations.

We often forget that the reason to buy insurance is to have financial compensation and support if there is a major claim. Ask these 5 questions to gauge if the insurance policy or firm you are dealing with is right for you.

  1. In the event of a claim, what is the process? Who will manage the claim? Who is your point of contact? Will you have to pay money out front — this is particularly of interest for health and travel insurance, where you will want to know if you need to have money available, or if they will take care of everything from the point of emergency.
  2. Is there 24-hour emergency claims service? Although the answer to this is always yes, how the emergency claims service is delivered is always interesting to know. Is an external firm hired to handle after hour calls, or does the insurance company or firm have their own staff handling claims?
  3. In the event of a claim is the adjuster working for the insurance company, or is it a contracted firm. This can be important because insurance adjusters who work for the insurance company directly usually are very knowledgeable on the coverages, and trained specifically to that insurance company service standards and norms, versus independent or outside contracted adjusters who represent many companies and are managed externally. They will be licensed and have general knowledge but in each claims case they will have to review and learn the coverages if their experience with your insurer is not vast. It is not to say the claim will not be handled properly, but you are immediately getting a third party involved so you may want to understand this in advance so that you aren't surprised in a claim.
  4. Ask about the basis of claims settlement. Will you be receiving actual cash value, replacement cost, or does your policy contain any other clauses you should know about? Will your policy waive the deductible, and if so, in what circumstances.
  5. Find out if you are allowed to hire your own contractors in the event of a claim, or use the garage of your choice for car repairs after an accident. Some insurance companies may not give you the option, so it is better to find out in advance because it could impact your choice.

Many of the Canadian insurance policies may also offer a guarantee on repair work in claims circumstances.

Many of them will allow you the freedom to choose from who and where you get work done.

Where to Buy Health Insurance in Canada for Newcomers or Visitors

Unmarried Health Insurance Benefits Domestic Partner Insurance
Everything you need to know about health benefits for unmaried couples and family domestic partner insurance coverage. Aslan Alphan / E+ / Getty Images

Canada is known for an inclusive public health care system. This can be really appealing if you live in a country, like the United States, where issues with the current Obamacare model have spurred constant debate, criticism, and concern. Canadians benefit from access to health care even with no job or little money.

Visitors to Canada or newcomers will not be able to benefit from health advantages right away. When moving to Canada, make sure and inquire about Visitors to Canada insurance that will cover you while you apply and wait for the Canadian Healthcare System benefits to be cleared for you. 

Understanding Home and Car Insurance When Moving to Canada

Couple looking at home insurance options to save money
Understanding the basics of home insurance options can help you save money while protecting your investment in your home. Geber86 / Getty Images

Home and Car Insurance coverage principles are very similar in Canada as they are in the United States. Just like you have varying laws from state to state for insurance, like different minimum car insurance requirements, in each province in Canada, you will see differences.

Liability Insurance in Canada

One of the most notable differences for home and car insurance are in the liability limits. For example, in the United States, some states will only give up to $300,000 personal liability on a standard policy, whereas in Canada, having $1,000,000 or $2,000,000 liability is pretty standard, and  you pay very little for it on home insurance. It is unusual for someone to take less than $1,000,000 on liability insurance for cars in Canada as well, although it is possible, it is not usually recommended.

It can be confusing when you are used to having lower liability limits to be sold higher values. If you understand this aspect of the insurance is slightly different in Canada, and understand you really aren't paying much more for it, you may feel more comfortable getting a quote knowing this is the norm.

Is Canadian Insurance the Same as U.S. Insurance?

Canada uses similar terms for insurance coverage to the United States. Even in places where people speak French, you will always be able to get your documents in English since Canada is a bilingual country. This will help you understand the basics. Even in provinces like Quebec, you can easily find English speaking people to represent you. Make sure you have clear communication with the person who represents you.

Many of the insurance articles here on The Balance can still help you understand the basic principles of insurance. Definitions of terms and concepts are widely standardized, such as All Perils/Open Perils coverage, Liability, and Umbrella Liability, and even car insurance coverages like comprehensive and collision.

In Canada each policy wording is defined by the Insurance Bureau of Canada, which sets the bare minimum requirements for each coverage wording or form, then the individual insurance companies can add more insurance coverage or perks to the base coverage, as part of their competitive strategy to attain and keep clients. 

Your Canadian insurance representative will not be able to speak about what insurance coverage you had in the United States, but a good tip is to ask them what is different in insurance in the province you are moving to.

Each province in Canada has different rules, for example in B.C. you have government car insurance. This is not the same in Ontario, although the liability risks there are very high in car insurance, and so they have special coverages you must buy. In Quebec, you have lower auto liability risks than other provinces, so there are coverages offered in other places, that you won't see there. The most important thing is to find out what is special about the place you are moving to, and by asking the question, the representative will be able to give you an overview of the things you need to be aware of.

The best thing to do is leave yourself enough time to find a representative or insurance company that fits your needs, before your move or vehicle/new home purchase so that you don't feel pressured to make choices because you are running out of time as your move approaches. A good way to save money on insurance is to give yourself the time to review your options and negotiate with insurance companies as you start to get closer to your decision.

Driving in Canada and Foreign Driver Licenses

One of the things that you may be asked for when you apply for your first car insurance in Canada is which kind of drivers license you have. Each province has its own legal requirements on how long you can drive with an international license, or your local state's drivers license if your intention is to move to Canada. Your insurance company will not be any different.

Expect that if you are moving to Canada, you will need to get a Canadian drivers license within a reasonable time frame if you want to get car insurance.

The insurance company will let you know what that time frame is. It is best to set that appointment to get your local license when you sign up for the insurance. If you are unable to get the local license or do not want to, you could call the Insurance Bureau of Canada to find out if you have any other options, they will be able to guide you to the rules of the province you are moving to and help.

Water Damage and Canadian Insurance

Due to differences in weather and an aging infrastrucure in many cities, water damage claims in Canada seem to run much higher than in the United States. Sewer backup is a major problem in some cities, and where the Insurance Institute in the U.S.A cites about $40-50 a year for the coverage, in Canada you can expect to be paying significantly more.

High Risks of Water Damage Claims in Canada

The risks for water damage are higher in Canada so be sure and consider adding coverage and don't get trapped in comparing the price because in insurance the pricing is based on the risk, so as soon as you see a drastic difference from where you used to live to where you are moving to, you should consider that the risks are likely different. An insurance specialist in the area you wil move to can explain these risks because of their local expertise. Although weather related water damage can be covered on your all risk or comprehensive home insurance policy, there are some specific Canadian coverages you need to know about that may be excluded if not specifically added.

Be Sure and Ask About These Water Damage Endorsements:

Sewer Back Up, Above Ground Water Damage, Ground Water Damage, Infiltration and Overland Water Damage. These make up most of the different water damage coverage options that are not automatically included in the standard homeowner policy. This is slightly different than what your coverages are in the United States, so be careful about asking clearly for what you need.

Some insurance companies do offer all these coverages, and others have chosen to restrict coverages because they don't feel comfortable with the high risk of claims. Just because one insurance company doesn't offer the coverage, does not mean that it is not available.

When in doubt ask the question straight out​: "Do any other insurance companies offer this coverage?" 

Flood Insurance in Canada

Flood insurance is available in Canada through a few insurers. It is expected in the near future many more insurers will offer overland water damage coverage. Unlike in the United States where flood insurance is usually purchased through a secondary special policy, in Canada is it possible to purchase with standard home insurance companies. Aviva Canada Insurance Company is one of the first to offer the coverage in the standard markets as of 2016.

Tips for Moving to Canada

Planning an international move is a major job in itself, by using these tips you will be on the right track to finding coverage that will not only cover you properly and help you with your move, but give you some advantages in pricing that some people may not be aware of. It is a lot of information, you can bookmark this page and use this as a reference as you hit the different stages of your move. These are tips to guide you in the right direction, so be sure and use these as talking points with your licensed Canadian insurance representative since insurance coverage varies from location to location and each province's laws, as well as your personal information, will impact the specifics of the coverage for your policy as well as pricing. Good luck with your move to Canada.