Most insurance companies classify vehicle use into one of three categories - commuting to work or transit, commercial use or pleasure and errands only.

While these categories accurately describe the driving behaviour for most people, some drivers who use their vehicle for business purposes have faced dilemma. Do they report they only use their vehicles to commute to work, or do they acknowledge they use their vehicles for commercial purposes and face higher premiums? The answer is "yes", you must disclose the proper usage of your vehicle in order to be properly insured, but make sure you are clear as to the extent you use your vehicle for business.

If you drive your vehicle to work, but also use it to visit clients for limited business, you may need Incidental Business Use Rating and for a small increase in premium, you won't have to worry about having any problems at the time of claim. Imagine the hardship of finding out you are unable to collect after an accident, especially after faithfully paying your insurance premiums because you failed to disclose the actual use of the vehicle. Don't be caught in a situation like this! If in doubt, talk to us about your vehicle usage and see if you need Incidental Business Use!

Commercial vehicle insurance isn't just for big trucks

If you work as a plumber, painter, carpenter or as some other type of contractor, you may need to be rated for Commercial Use instead of commute to work. Whether you are self-employed or work for a larger company doing this type of work, your insurance company could deny any claim if you failed to disclose the Commercial Use of your vehicle.

Other uses that may require a commercial vehicle policy include real estate sales, fast food delivery, catering and landscaping or snowplowing services to name a few.

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A collision occurs when your vehicle collides with another object on or attached to the road or ground.

Flying objects, such as birds and airborne debris, are not on or attached to the road or ground, and thus are not considered collisions. Many of these types of claims are paid under the comprehensive coverage of an auto insurance policy.

The definition of collision is important when you consider everything that does become eligible under this definition that one could collide with. Debris on a highway, for example, is on or attached to a road. If someone drives over or hits road debris, a collision has occurred. Same thing applies for street signs, parked cars, pedestrians and bicycles. The only notable exclusion is that of a living animal that enters the roadway in your path. It is stressed that the animal must be living at the time of the impact to be excluded. Deceased animals are considered the same as debris when relating to collisions. It also needs to be stressed that, sadly, you need to hit the animal to be excluded under the definition of collision. If the drivers swerves to avoid the animal and as a result loses control of their vehicle and hits a tree, ditch or other vehicle etc., the exclusion is void, as the vehicle has now struck an eligible item under the definition of collision.

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It's all about Choice!Changes to Automobile Insurance Coming to Ontario

Ontario recently announced legislation that will give consumers more choice and flexibility in their automobile insurance protection. More than 40 revisions to auto regulations have been proposed that give consumers options.

The proposed reforms will help keep insurance premiums affordable by letting Ontario drivers buy coverage that best meets their individual protection needs and budgets. Drivers could opt for a new standard level of auto insurance coverage that could help reduce their auto insurance premiums, or choose additional levels of medical and rehabilitation coverage including a wider range of attendant care, housekeeping expenses, death and funeral expenses. Here are a few of the proposed highlights:

• Reduction of Medical and Rehabilitation (non-catastrophic) from $100,000 to $50,000
• Attendant Care Benefit (non-catastrophic) from $72,000 to $36,000.
• Housekeeping, home maintenance and caregiver benefits would be optional
• The option to buy additional coverage to effectively reduce the Bodily Injury Deductible from $30,000 to $20,000.

A complete list of changes is available at

www.fin.gov.on.ca/en/consultations/auto

When compared to other provinces with similar auto insurance plans, Ontario’s new standard medical and rehabilitation benefits will remain the most generous in Canada.

In addition, 17 new consumer protection measures have been proposed including one that prohibits using a driver’s credit score to determine whether a driver is insurable or how much to charge for automobile insurance.

As your Broker, we applaud these changes and look forward to making sure you have insurance that fits your needs and your budget.

It is expected the new legislation will be implemented in late 2010 and we will make sure that you are well-informed. If you have any questions or concerns, please contact us.

We’re on your side!

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If we told you that the government was handing out money for free, would you be interested? No, you won't have to testify at the Gomery inquiry if you accept the offer. All you have to do is set some money aside for your child's (or children's) education – and that's something you may have been considering anyway.

According to information released by Statistics Canada last year, university tuition fees have increased at an average annual rate of 8.1% between 1990/1991 and 2002/2003 – that's four times the rate of inflation. Last year, Canadian undergraduate students paid an average of $4,172 a year in tuition fees. Some professional programs charge significantly higher amounts than that; first-year tuition for a law student at the University of Toronto is currently set at $16,000. Add in books, food and housing costs and you could be looking at a very significant expense.

There are, fortunately, savings vehicles that can help you prepare.

A Registered Education Savings Plan (RESP) is a little bit like a Registered Retirement Savings Plan (RRSP). While you may not deduct the contributions you make, your earnings do accumulate tax-free, and when your child withdraws funds, the growth is taxed in his or her hands – not yours. Since students tend to have little other income, they'll probably end up paying very little (if any) taxes on the money they receive.

Several years ago, the government introduced several changes to make RESPs more attractive and encourage Canadians to start setting money aside for their children's education. Students may now attend a wide variety of qualifying programs, including not only university but also community colleges and trade schools. Even if your child decides not to pursue post-secondary education, your money doesn't go up in smoke — you can roll all of your contributions and up to $50,000 of your earnings into your RRSP provided you have unused contribution room. In the worst case scenario, you'll still keep 80% of your profits and receive a cash refund of your capital.

There's also a lucrative Canada Education Savings Grant (CESG) available to anyone who opens an RESP. The government will top up your plan with a grant equal to 20% of your contribution, up to an annual maximum of $400 and a lifetime maximum of $7,200.

You don't have to be rich to take advantage of the plan, either. In fact, if your family earns $35,000 or less a year, changes introduced a few months ago make you eligible for a CESG of 40% on the first $500 you deposit every year. There's also a new Canada Learning Bond that will offer children who qualify for the National Child Benefit supplement a special $500 payment at birth, then $100 every year for the next 15 years.

If you're interested in learning more about the education savings options available to you, we hope you won't hesitate to contact us.

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Approximately 16,000 people are convicted of driving with a blood-alcohol level above the legal limit in Ontario each year. That’s almost two people every hour!

Changes to Ontario’s Highway Traffic Act in 2008 means you could now face a three- day suspension (for your first offence) if you operate a motor vehicle with a blood alcohol level of .05 to 0.8 or more. In the past, it was a 12 hour suspension. If you are caught as second time, your license may be suspended for seven days, and you will undergo a remedial measures course.

From an insurance perspective, any suspension is now recorded on your driving record. After the first offense, you could face significantly higher insurance premiums.

While you license is suspended, you are uninsurable.

About one quarter of all Ontario collisions with fatalities involve drinking drivers. Drinking and driving hurts us all- through deaths, injuries and personal tragedies, in addition to costs for health care, emergency response and property damage. Please don’t drink and drive.

Did you know?

In Ontario the legal limit for blood-alcohol is .08 milligrams per 100 milliliters of blood.

Keep our roads safe for all motorists

If you host an event or party where alcohol is served, you have a legal responsibility to ensure your guests do not drive after drinking. If your event requires a liquor permit, your liability exposure is greatly increased. The line between host liability and liquor legal liability can be fuzzy. Talk to us about insurance options that can reduce your liquor
liability exposure.

Attention party or event hosts: Here are some hints to reduce you liquor liability exposure:

1. Hire a licensed and insured vendor to serve the alcohol.
2. Serve drinks rather than having a self-serve bar.
3. Serve food, as adequate amounts of food slow down the effects of alcohol.
4. Offer plenty of non-alcoholic drinks.
5. Hold the event early in the day to discourage excessive drinking.
6. Provide a taxi or alternative form of transportation for quests who have imbibed.

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The Risks of Lending Your Vehicle to Others

Ah, yes. Something we have all heard, or even said, so many times that we don’t even think about what these simple words really mean.

Children have separate ratings on auto insurance policies to cover the additional risk or exposure to loss that arises from their use of your vehicle. But what about everyone else? We think twice before allowing our kids to drive our car when they are listed and insured on our policy, but we toss our keys to a friend before they can even finish asking us if they can borrow the car. Have you ever stopped to think why we do that? Probably not, but you should.

Unlike listing your child, there is no added protection on your auto insurance policy to protect your rating against the actions of the people to who you lend your car to. So…..? So, basically by lending your car to someone, you are lending him or her your insurance policy and your clean driving record.

As the owner of the vehicle, you hold full responsibility for that vehicle and the actions of those who operate it. Simply put, if you give your mother, brother, sister, father, neighbour, cousin, friend etc., permission to drive your car, anything they do to that car (and other cars while in your car) is your responsibility. So if your sister comes over for dinner and borrows the car to drive down to the corner store for more milk and rear-ends another car on the way … it’s your fault. Even though your sister may have her own car and insurance elsewhere, the accident will be charged against your policy.

Why is that?

With auto insurance, there are certain coverages that follow the driver, and others that follow the car. Accident Benefits, for example, follow the driver. If you are injured while driving or riding as a passenger in someone else’s car, your auto policy will respond first to any loss you have due to injury (medical bills etc.). Physical Damage coverage such as Collision, Comprehensive and Direct Compensation follows the car. This is why no matter who causes the damage to the car, the rating for the accident causing the damage will follow the insurance policy under which the damages were paid out.

Because of this, it is very important that we as the owner of the vehicle, put on our “insurance company” hats before saying yes to hands held out for the keys to our car. We need to ask ourselves some very important questions:

1. Do they have a valid license? Seems like a silly question, but did you know that your coverage could be null and void if you lend your car to someone that you knew or should have known was unlicensed to drive? This includes lending your car to a person who has an improper class of license to drive your car (i.e. lending a G1 licensed driver your car to drive alone), or a person who’s license has been suspended due to too many tickets or unpaid fines.
2. What are they using the car for? You will want to know where and for what purpose they are using your car. Be aware that restrictions of your policy apply to all drivers, not just the listed ones. Are they using it for business reasons (and if so, are you covered for business use?)? Are they leaving the country with it (remember, your auto insurance is only valid in Continental Canada/U.S.A.)? Are they using it to haul trailers or carry goods, equipment or dangerous items?
3. What is their driving record like? Be nosy, you may be glad you were. Finding out your best friend of 15 years has 6 speeding tickets and/or 3 at fault losses in the past few years is something you will want to know before handing over your keys, as opposed to when they return your car on the back of a tow truck. This is where you get to play “insurance company”. Ask yourself “would I want to be the insurance company who is financially on the hook for this driver’s actions?” If your answer to this question is “no” then the answer to “can I borrow your car” should be simple.

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Starting September 1, 2005, the following new rules apply to teenaged G2 drivers between the hours of 12:00am midnight and 5:00am:

1. In the first 6 months after receiving your G2 license, you are allowed to carry only 1 passenger aged 19 and under.
2. After six months with your G2 license and until you obtain your full G license, or turn 20, you are allowed to carry up to 3 passengers aged 19 and under.

These new rules are aimed at reducing collisions and saving lives. They apply to ALL teenaged G2 drivers, including those who received their G2 license prior to September 1, 2005.

Exemptions: These restrictions do not apply if you are accompanied by a fully-licensed driver (with at least 4 years of driving experience) in the front seat, or, if your young passengers are members of your immediate family.

For more information, or if you have any questions, please contact your local Ministry of Transportation office.

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Take an inventory of your goods and ensure it is in a safe place away from your home. If you do suffer a loss, it will make filing a claim much easier. It's difficult to remember how many CDs you have, what the winter boots look like and what the pattern of Granny's silver was. Use a tape recorder, video camera or Polaroid to speed up the process. Or use a company that specialises in videotaping belongings.

Put your valuables in a safety deposit box. Your insurance company will help if you suffer a loss, but sentimental items can never be replaced.

Remember that your homeowner's policy will cover your possessions temporarily removed from your home - that includes the contents of your suitcase - so keep track of what you've packed.

Don't advertise that your home is empty - Give your home that "lived-in" look while you're away.

Leave your keys with a trusted neighbour who can turn your lights on and off, open and close your curtains, bring in the circulars, mow your lawn or shovel the snow, move your car or park theirs in your driveway.

If you are going to be away for more than two days, ask Canada Post to hold your mail and call the newspaper office to stop delivery until you return.

If you are leaving in winter for more than four days, you must arrange to have someone check on your home or shut off the water and appliances and drain the pipes. This is because of the risk of freezing pipes and the damage that would be caused after several days of water pouring into your home. Some companies could disallow the claim if you haven't made arrangements.

Timers are inexpensive and effective, especially the multiple-program type. Using them on lights or certain appliances gives your home a "lived-in" look that thwarts robbers: there's nothing quite as effective as a light or radio that suddenly goes on.

Ensure that all doors and windows are securely locked. Put a block of wood along the track of your sliding doors to prevent them from being forced open.

In an apartment building, ask a fellow tenant you know fairly well to pick up the flyers and other things that accumulate in front of your door.

Follow these simple tips and don't give thieves any breaks!

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Car insurance rating is affected by the regular drivers of the car being insured. For other factors see "Key factors affecting the cost of your insurance"

The principal driver is the one who drives the car most often.

An occasional driver is one who drives a car regularly but is not the principal user of the car AND who is not listed as a principal driver of any other car. If a person is listed as a principal driver of one car, then that person does not have to be listed as an occasional driver of another car.

All drivers in a household must be declared on a car insurance application. If any driver is already insured on some other car insurance policy then the name of the insurer and the policy number must be stated in order to avoid being charged.

Occasional drivers are rated separately if the driver is male under the age of 25. Female occasional drivers under the age of 25 are rated separately by some insurers while other insurers will downgrade the rating of the principal driver.

There may or may not be a charge for an occasional driver over the age of 25 depending on the driver's experience and driving record.

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Cell-phone driving ban now in effect

Keep your eyes on the road and your hands on the wheel. Ontario is now the fourth province to ban hand-held wireless communication devices or any hand-held electronic entertainment devices while driving. Drivers in Ontario are now prohibited by law to use hand-held cell phones, text or e-mail, or view laptops or DVD players while behind the wheel regardless of being at a stop-light or in heavy traffic. Drivers who text, type, email, dial, or chat using a prohibited hand-held device can face fines of up to $500, as well as possible demerit points, license suspension and/or imprisonment.

Hands-Free Devices Only

The new law applies only to hand-held wireless communications and hand-held electronic entertainment devices. This means drivers must only operate wireless devices that can be used in a “hands-free” manner.

Hands-Free Devices Include:

• a cell phone with an earpiece or headset using voice dialing or plugged into the vehicle’s sound system
• a global positioning system (GPS) device that is properly secured to the dashboard or another accessible place in the vehicle
• a portable audio player that has been plugged into the vehicle’s sound system.

For more information, visit http://www.mto.gov.on.ca/english/safety/distracted-driving/index.shtml

 Recent studies show that cell phones can be a major source of distraction for many drivers. Cell phone users are four times more likely to be in an accident than a driver focused on the road. Dialing and texting carry the highest degree of risk with all cell phone-related activities.

Ontario joins more than 50 countries worldwide and a growing number of North American jurisdictions that have similar distracted driving legislation including Quebec, Nova Scotia, Newfoundland and Labrador, California and New York.

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