Buying Car Insurance:

What You Need to Know

Buying a car is a significant purchase and it is important to make sure that you have the right type and amount of insurance. Here’s what you need to know:

What car insurance do I need to have?

In BC, basic insurance is mandatory if you drive a vehicle. This is provided through ICBC only. Other additional insurance coverage is optional and is available through a variety of providers.


Who can sell insurance?

Only a licensed insurance agent or salesperson can offer you the mandatory basic ICBC Autoplan insurance coverage. An insurance agent or salesperson may also offer you optional insurance related to your car such as collision, comprehensive, guaranteed asset protection (GAP), and replacement cost.

In some situations, the car dealership that sold you a car may also offer you optional car insurance, however, there are some limitations. For instance, a dealership without an insurance licence can offer vehicle warranty insurance, a type of insurance product that provides financial protection in the case of mechanical breakdowns.  Whereas, a dealership with an insurance licence can also offer other limited types of car insurance. However, at no time can a dealership sell you any type of insurance that provides more than $15,000 in protection unless it is vehicle warranty insurance.

What do I need to know about buying an insurance product?

It is important that you understand the type and amount of insurance you need and if the product you are buying suits that need.  You have a right to know and ask the following before you buy:

  1. Is the person offering the insurance to you qualified and licensed to do so?
    You can check to see if a company, agent or salesperson is registered with the Insurance Council by searching our licensee directory.

  2. Is the insurance that is being recommended required or optional?
    Make sure you understand what insurance products are mandatory and which ones are optional. 

  3. What other car insurance products are available to you and why might you want to buy them?
    Consider whether the same type of coverage is available through a different type of policy such as critical illness or life insurance.

  4. Does the benefit of having this insurance change over the time you own the car?
    What impact will the age of the car have on your coverage and on the cost of the policy?

  5. What is the difference between the optional insurance products you have been offered?
    You should always be offered more than one option by an insurance agent. 

  6.  Who is the insurance company on the policy?
    While you may buy your insurance through an agent or a broker, it is the insurance company named on the policy that provides financial compensation for a claim. Make sure you know whom your contract is with. 

  7. What is the cost of the insurance; have additional fees been added and why?
    Make sure you know what constitutes the cost of your insurance, and any additional fees there may be. This will allow you to make an informed choice about where you buy your optional insurance.

  8.  How is the agent/salesperson paid if you purchase the insurance?
    By law, agents/salespeople are required to disclose all fees associated with the sale of insurance. 

Who can I contact if I have a concern?

The Insurance Council of BC is the regulator for insurance agents, agencies, salespersons and adjusters. Contact us if you have a complaint or concerns about improper insurance sales by a company, or the conduct of an insurance agent or salesperson.

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