Your Auto Insurance Broken Down

Did you know that your ‘auto insurance’ is more than just auto insurance? The premium you pay is derived from these coverages that together form your auto insurance policy.

So, what is the difference between comprehensive and collision coverage and what is legally required in Alberta? We have broken down the insurance sub-categories that collectively form your auto insurance policy.

 

Mandatory Auto Insurance

In Alberta, we have mandatory auto insurance and additional optional coverage.  It is the law for Albertans to carry a minimum of $200,000 of coverage of Personal Liability and Property Damage Insurance, also known as third-party liability insurance.  This type of insurance covers damage caused by your vehicle to another person or their property.

Albertans are also legally required to carry Accident Benefits to cover the passengers of a vehicle in the event of death or injury.  Accident Benefits are applicable regardless of who is at fault.  It would cover medical and rehabilitation costs, funeral expenses, death benefits and income replacement.  Accident Benefits also include Uninsured Motorist coverage which protects you in the event you are in an accident with a driver who does not have auto insurance.

Additional Auto Insurance

In addition to the mandatory auto insurance coverages there are several additional coverages you can have.

Collision Coverage pays for the repairs to your vehicle in the event of damages occurring through an accident whether you are at fault or not.

Specified Perils is a more comprehensive coverage than Collison Coverage in that it covers damages caused by whatever perils are specifically named in the policy (i.e. theft or fire) that are not the result of a collision.

Comprehensive insurance covers damages to your vehicle that were not the result of a collision, for example theft, vandalism, fire or weather-related damage.  Comprehensive insurance coverage offers the greatest degree of coverage with respect to automobile insurance policies.

All Perils Coverage is a very broad type of coverage.  It covers everything that Collision and Comprehensive covers, plus theft by somebody in the household or by an employee.

When discussing insurance options, it is important that these options are understood, especially when choosing insurance coverage that best fits your needs. If you ever have questions regarding your auto insurance policy or coverage in general, contact Rizk Insurance today and we’ll help answer any inquiries you may have.

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