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Did You Know

Principal of indemnity
Insurance policies are not maintenance contracts. They are designed to pay for perils insured under the contract that are of a sudden and accidental nature.

No fault insurance for accidents; does NOT mean no one is at fault
A common misconception about no-fault insurance is that the insurance companies will not make a fault determination in the event of an accident. This is a misconception because in every claim situation where two drivers are involved, the insurance companies will always determine who is at fault.
No-fault insurance simply means that it does not matter who is found at fault; your insurance company will handle your claim and pay out for damages and injuries to you. The other person’s insurance company will do the same for them. Someone will still be determined to be negligent in the accident, and that person may experience a potential rate increase upon renewal or when shopping for car insurance quotes. Fault can also be split between the two parties in percentages, in which case both may see an increase in insurance rates.
Coverage given for accident victims by SAAQ: no-fault systems generally exempt individuals from the usual liability for causing bodily injury if they do so in a car accident with residents of the same province covered by the same plan. Under the plan, victims of bodily injury sustained in an accident are compensated regardless of which party is to blame. The need for proceedings before civil courts is accordingly eliminated, replaced by the right of all Quebecers to compensation for injuries.
People who commit driving-related Criminal Code offences (impaired driving, hit and run, dangerous driving, etc.) are, of course, still subject to prosecution.
No-fault insurance has the goal of lowering premium costs by avoiding expensive litigation over the causes of accidents, while providing quick payments for injuries or loss of property.

New parts vs used, rebuilt, jobber. A clarification concerning automobile body parts
In a partial loss situation, the insurer will determine the cost of materials on the basis of original equipment manufacturer parts if

  1. the vehicle is less than two years old or has less than 40,000 km; or
  2. the vehicle is used for commercial purposes and is less than one year old.

In all other instances, the insurer may base its determination on the cost of similar automobile body parts. However, the named insured may ask for original equipment manufacturer parts, if available, and must then inform the insurer accordingly when reporting the loss.
The insurer will then specify the applicable conditions and additional costs that the named insured will be required to pay out of his/her own pocket.
An additional insurance product called ‘replacement cost’ of ‘Q.P.F. No. 5 Replacement Insurance’ can be purchased in order to hedge against parts depreciation.
If the insured vehicle is a total loss or constructive total loss, the value of damage will be equal to the “actual cash value” (current market value) of the insured vehicle.
An additional insurance product called ‘replacement cost’ of ‘Q.P.F. No. 5 Replacement Insurance’ can be purchased in order to hedge against depreciation.

All policies have limitations, conditions and exclusions.
We strongly recommend that you read your policy so that you become aware of these in the event of a loss; a loss which may not be covered. For example: the By-Laws in your city may have changed since your home was originally built. If this is the case, a portion of the cost to rebuild your home in the event of a loss might not be covered.

One example could be:
2×4 studs (which may have been originally used to build your house) may no longer conform to today’s building code and must be replaced with 2×6 studs which might not be covered if you don’t have the By-Law Endorsement.
Some exclusions or limitations on the policy can be purchased by endorsement or rider as follows:

  • Pool coverage
  • Identity theft protection
  • Legal Fee/advice Insurance
  • Water Service Pipe
  • No Obligation to rebuild/Replace
  • Umbrella Liability
  • Earthquake
  • ’Green’ reconstruction materials
  • Damage caused by escape of domestic fuel oil
  • Various floaters to cover specific items
  • By-Laws
  • Loss of use car rental following an accident
  • Replacement Cost for automobiles
  • Driving Record Protector
  • Road Side Assistance
  • Deductible waivers
  • Car rental coverage while travelling in Canada/US