Regardless of your driving history, premium prices will vary between car insurance companies in Canada.
Even the best insurance companies in Canada, those with the best customer service in the country, will you offer completely different rates.
That's because some insurance companies put more weight on your driving record while others may charge more due to their bottom line.
There are many ways to judge car insurance companies, so you must look at several factors.
For instance, Google reviews are often skewed because people only tend to write after a poor customer service experience or if a claim was denied. Only use those reviews to look for a worst-case scenario. Then, speak to your insurance broker about how you could avoid situations like the ones described.
Car insurance reviews: the flaws
Aviva Canada, for instance, has a 1.3 star rating out of 5 with 403 reviews. The latest negative review had to do with not having a car for 2 weeks. I don't know all the details, but the customer likely didn't have car insurance endorsement #20 (loss of use coverage) as part of their auto insurance policy which gives you coverage for transportation replacement. Without it, you don't get a car while yours is in the shop.
Intact Insurance got a 1.3 out of 5 stars and the reviewer complained their "Settlement Offer [was] way below market value!"
Well, again, it's why it's critical to make sense of your automobile insurance application. There are two ways you can get paid out if your car is a write off: replacement cost or actual cash value.
A quick primer: cars depreciate in value the moment you drive it off the lot by as much as 20% in the first year alone. So, with endorsement #43, you can get full cost replacement of your vehicle, not its depreciated value. But, it costs much more.
READ MORE: How does replacement car insurance work?
How to define the best car insurance companies in Canada
We can look at third-party data to help us. Independent reviewers that delve deep into the roots of the system. According to JD Powers Canadian Auto Insurance Satisfaction survey, the best auto insurance company in Canada is The Co-operators Group.
However, the customer satisfaction survey was done in 2018, and J.D. Power haven't done a new one since.
Another way to determine the best car insurance companies in Canada is price.
The best car insurance companies in Canada by price
- Aviva Canada
- Economical Insurance
- SGI Canada
- Pembridge Insurance
- Unica Insurance
- Onlia Insurance
- Intact Insurance
- CAA Insurance
- South Easthope Mutual
- Echelon Insurance
When you put in your driver and vehicle details and your insurance history, our car insurance calculator runs those details through an algorithm to see what each company would charge you.
So, when we look at our internal data, we can see which companies are currently offering the lowest price by aggregate score. This doesn't mean the best car insurance companies will give you the best price because it's an average among all the quotes. You may get a better price from a different company based on your unique details.
Customer service vs. price
But does better customer service always mean a higher premium? And in the cases where it does, how much does customer service actually improve the more you pay?
We decided to compare the top-rated insurers for customer service against auto insurers who were rated slightly lower for customer satisfaction to see if customer satisfaction is worth the premium.
Our final results show that In every region J.D. Power studied (except for Ontario), the second or third-placed company offered a significant discount on premiums compared with the highest rated insurer.
NOTE: British Columbia, Manitoba and Saskatchewan were excluded from the J.D. Power survey, because of their public auto insurance programs.
How we compared auto insurance costs to customer service
Ratehub.ca measured the difference in premiums between the top three highest-rated insurers in each of the four regions using a control, named Brenda Fenda.
Brenda is 30-years-old with a perfect driving record. She owns a 2018 Honda Civic LX and rents an apartment in a residential area close to the downtown core of a major city in each province tested. Ms. Fenda is single and drives 12,000 km per year for her short commute and nearby sales calls.
Brenda values customer service but doesn’t want to her premiums to go up significantly. Let’s take a look and see the correlation between price and customer service.
Are you paying the best price for car insurance?
The Best Car Insurance Company in Alberta
If Brenda is in Alberta, she’d be charged $144 more per month by The Co-operators than she would by the Alberta Motor Association, who just so happens to be the second-highest rated auto insurer for customer satisfaction in Canada’s oil capital.
The discrepancy here may be accentuated by the Alberta Motor Association offering more discounts up front, giving her a lower auto insurance quote.
Furthermore, some drivers may feel that better customer service is worth a higher premium.
But in the Albertan Brenda case, she wouldn’t have to lower her standard of customer service a great deal to save on her premiums. In fact, lowering it too much might cost her more.
The Best Car Insurance Company in the Maritimes
If Brenda lived in Atlantic Canada she’d find the difference between the top three customer satisfaction ratings in J.D. Power’s survey is quite small.
Second-place Intact Insurance offers a monthly premium that’s $50 cheaper than highest-rated The Co-operators.
TD Insurance only has a slightly lower customer service rating than Intact in Atlantic Canada and offers the cheapest coverage among any of the insurers on this list, at $90 per month.
The Best Car Insurance Companies in Ontario
Perhaps the oddest comparison is looking at Brenda’s Ontario car insurance quotes, where the country’s best customer service performers, The Personal and The Co-operators, square off.
Ontario is the only province where insurers with worse customer satisfaction charged significantly more than the highest rated company.
Top rated The Personal offers Brenda a premium that’s $88 cheaper per month than The Co-operators, who are only one point below in customer satisfaction.
In turn, Intact Insurance is only one point below The Co-operators in customer satisfaction and offers the middle premium of the three.
READ MORE: The best car insurance companies in Ontario
The Best Car Insurance Companies in Quebec
Brenda would have good reason to compare auto insurers in Quebec, where all three insurers are closely ranked for customer satisfaction, but top-ranked The Personal actually charges $10 less per month than second-place Industrial Alliance.
Third-placed La Capitale offers Brenda an even more competitive rate of $107 per month, while only sacrificing one point in customer satisfaction to Industrial Alliance.
The Final Cost of Customer Service and Car Insurance
So what are you actually getting when you pay for higher customer service?
The 8,958 auto insurance policyholders who J.D. Power surveyed said insurers who resolve issues with the fewest points of contact were better at customer service. Additionally, keeping policyholders up to date changes to their premium pricing, whether it goes up or down, was a major factor in how policyholders rated their company.
Overall, Canadians told J.D. Power they were less happy with auto insurers than in previous years.
The study’s authors chalk that up to increased competition from start-ups showing consumers how much policyholders are missing out on in terms of convenience.
Surveyed drivers said digital communication channels improved customer service, making claims more convenient and at least half said they preferred interacting with an insurer online.
The bottom line
If you can take away anything from this comparison, it’s that the most expensive insurance isn’t always the best. Customer service is important, but cost is also a factor.
To get the best value, compare car insurance quotes with satisfaction ratings to find the best car insurance company in Canada for you.
PHOTO BY:Sarah Pflug