My auto insurance costs more: why?

 Auto insurance costs more for many people. Three reasons make it possible to understand why. 

1. The cost of repairs on the rise

A real computer on four wheels, a car costs more and more to repair or replace: ubiquitous technology, the price of parts to be replaced and the increase in the cost of labor are driving up the bill.  

In 2010, the cost to repair a car after a collision was $ 3,800. In 2020, that cost was over $ 5,400 . Such an increase inevitably has an impact on the cost of auto insurance. 

2. Insufficient premiums to pay claims

In recent years, the premiums requested by Quebec auto insurers have not been sufficient to cover the cost of claims. For every dollar of premium billed, insurers paid between $ 1.04 and $ 1.07 to compensate their clients and pay salaries and other administrative costs.  

The current increase in premiums therefore aims to find a balance in the market.  

3. The premiums required to pay a claim 

You pay an average of $ 732 1  to insure your car in Quebec. On the other hand, if we are involved in a collision, it costs the insurer on average $ 5,400 to compensate us. Do the math: it's more than 7 times the amount we pay individually! 

How do insurers get there? The premiums of all the clients of an insurance company are used to compensate those who have an accident. This is how insurance works. The increase in the cost of claims and premiums therefore concerns all drivers.  

1 This cost includes private insurance for material damage and public insurance for bodily injury provided by the SAAQ.