If you work from home, use transit or drive mostly on weekends, you may pay less because insurers can use annual kilometres and commuting distance in your rate. Ontario does not have one automatic low-mileage discount, but some insurers may offer their own discount, telematics program or pay-per-kilometre option.
For this article, our team reviewed FSRA’s Ontario rating-factor guidance, its auto-insurance savings guidance, and its usage-based insurance update.
Keep reading to learn what may count as low mileage, how standard kilometre bands differ from telematics and pay-per-kilometre products, how distance may be verified and what to compare before enrolling.
Read More: How Usage-Based Car Insurance Works
Can Low-Mileage Drivers Pay Less for Car Insurance?
Yes, driving fewer kilometres can help lower your car insurance premium, but there is no standard kilometre threshold or guaranteed discount across Canada. Some insurers factor annual mileage directly into their regular pricing, while others offer low-mileage discounts, telematics programs or pay-per-kilometre insurance.
If you don’t drive much, compare the total annual premium across insurers using the same coverage and deductibles. For usage-based or pay-per-kilometre programs, also check the mileage limits, how your driving is tracked and any privacy or device requirements.
Ontario insurers may use annual kilometres and commuting distance as rating factors. Report a realistic annual estimate and tell your insurer if your driving habits change significantly.
Read More: Tips to Save on Car Insurance in Ontario
How Many Kilometres Is Considered Low Mileage?
Since there isn’t any specific standard for low mileage, you should ask each insurer how annual kilometres affect the insurance rate and get the full annual price for any separate pay-per-kilometre or telematics program. Driving under roughly 10,000–12,000 km per year may be considered relatively low mileage by some insurers.
Does This Fall Under Usage-Based Insurance?
Not necessarily. An insurer can use your estimated annual kilometres as a regular rating factor without enrolling you in a usage-based insurance program.
Usage-based insurance (UBI), on the other hand, uses an app or device to collect driving data, which may include distance driven, when you drive, and driving behaviours such as acceleration or braking.
Some insurers also offer pay-per-kilometre insurance, where your premium includes a base cost plus an amount based on how far you drive.
Before signing up for either program, check what driving data is collected, how it affects your premium, whether there are mileage limits, and what happens if the app or device stops working.
How Do Car Insurance Companies Measure the Mileage on Your Vehicle?
Distance may be estimated on the application, verified by odometer evidence or measured through an insurer-approved app or device. Ask what data is collected, how often, for how long and what happens if data is missing.
Keep dated photos of your odometer and service records if the insurer requests verification. A repair shop does not verify your mileage for you, and an annual shop visit is not a regular requirement.
Read More: How Often Should I Check Auto Insurance Rates?
What Canadian Car Insurance Companies Offer This Type of Insurance?
Ask a licensed representative which approved low-kilometre, telematics or pay-per-kilometre options are currently available in your province. Compare the complete contract instead of relying on an old provider list.
For example, CAA Insurance offers CAA MyPace, which is specifically designed for lower-mileage drivers and bases part of the premium on kilometres driven. Intact Insurance and Desjardins Insurance also offer usage-based programs that use driving data to help determine potential savings.