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Article Contents
Picture of By <span>Aren Mirzaian</span>
By Aren Mirzaian

Updated on May 16, 2024

Visit author page
Picture of By <span>Aren Mirzaian</span>
By Aren Mirzaian

Updated May 16, 2024

Visit author page

10 minute read

Article Contents

Quick Facts About Auto Insurance in Newfoundland

  • The average auto insurance rate in Newfoundland and Labrador is $1,075.
  • On average, 700 moose-vehicle collisions happen every year in Newfoundland.
  • Newfoundland and Labrador have the fourth-highest auto fatality rate in Canada at 7.9 per 100,000 people.
  • There were 2,490 traffic violations recorded in Newfoundland in 2021.

How Can You Get Cheap Car Insurance in Newfoundland?

You can get cheap car insurance in Newfoundland by lowering your premiums and finding the best-valued insurance policies. Here’s how you can do that:

Compare Policy Deals

One of the best ways to get low Newfoundland auto insurance rates is to compare insurers. Insurance companies compete for a customer’s business by offering great deals and other incentives, so shopping around will help you find the best rates.

Pay Premiums Annually

Insurers like it when people make annual or bulk payments because it guarantees their business for an entire year. By paying insurance premiums upfront for the next 12 months, you can save more money. Some insurance companies also offer six-month premium payments if paying for an entire year is too steep.

Be a Safe Driver

Traffic violations and accidents raise your Newfoundland insurance rates and can take years to go away. Having a clean driving record ensures you’ll get lower Newfoundland auto insurance rates compared to drivers with a history of accidents.

Get Usage-Based Insurance

Usage-based insurance (UBI) or pay-as-you-go insurance determines your rates by analyzing your driving habits through an onboard device. If you consistently exhibit safe driving behaviour, you can save up to 30% on car insurance premiums.

Skip Unnecessary Optional Coverage

Opting into all available insurance coverage protects you from many things, but your premiums will increase sharply. Consider lowering your Newfoundland auto insurance rates by skipping non-essential coverage.

Buy Reliable Cars

Canadian insurers use CLEAR (Canadian Loss Experience Automobile Rating) to measure a car’s safety and reliability score. Lower CLEAR scores usually mean higher insurance premiums because they’re more likely to get into an accident. Check a car model’s CLEAR before buying to save on insurance.

Take Home and Auto Bundles

Bundling home and auto insurance from one company could give you discounts because the insurer gets more business in one go. Generally, home and auto bundles are cheaper than getting individual policies from two companies.

Ask for a Higher Deductible

You pay deductibles with every insurance claim before the insurer covers the remaining expenses. With higher deductibles, you pay more if you get in an accident, but your premiums will be lower. Conversely, lower deductibles mean paying less in an accident, but your premiums will be higher.

How Does Car Insurance Work in Newfoundland?

Car insurance in Newfoundland works by providing you with financial benefits if you get in a car accident. Car insurance is mandatory in Newfoundland, meaning you must have an insurance policy to drive – otherwise, you may face fines and suspensions. You may also receive demerit points that signify you as a high-risk driver, raising your premiums. 

Like in most parts of Canada, both mandatory and optional insurance coverage are available in Newfoundland. You only need the former to drive legally, but optional coverage protects you from more hazards.

All drivers in Newfoundland and Labrador must have third-party liability coverage worth at least $200,000 as well as uninsured automobile coverage. Here’s a look at the two essential mandatory insurance coverage for Newfoundland drivers:

Third-Party Liability (TPL)

Third-party liability coverage pays out if you cause an accident that resulted in vehicular damage or somebody getting hurt or killed. Newfoundland requires a minimum of $200,000 TPL coverage for all drivers.

Uninsured Automobile Coverage

This kind of coverage pays out if you are involved in an accident with an uninsured driver. Drivers without auto insurance usually don’t have money to pay for your damages, so your insurer will step in to cover these costs.

In addition to the mandatory coverage, the Newfoundland Government also recommends that drivers get the following insurance protection:

Additional TPL Coverage

The bare minimum $200,000 TPL coverage sometimes isn’t enough. Some people buy up to $2,000,000 in TPL coverage to protect themselves when an accident happens.

Accident Benefits

Accident benefits cover medical bills, income replacement, and possible funeral expenses if you, your passenger, or a pedestrian are hurt or killed in an auto accident.

If you need extra protection, you also have other insurance coverage options. Here are some examples:

Collision Insurance

Contrary to popular belief, your mandatory insurance coverage doesn’t cover car repairs when you’re at fault. Taking collision insurance is a good idea because you won’t know when you might be at fault for an accident. 

Comprehensive Insurance

There are 700 moose accidents in Newfoundland yearly, meaning it’s more likely to happen than you think. Comprehensive insurance protects you from animal collisions and other hazards like bad weather, vandalism, and fire – pretty much anything that’s not accident-related.

Limited Depreciation Waiver

Insurers can write your car off when it is totalled or stolen because it’s too expensive to recover. A limited depreciation waiver refunds your car’s purchase price in the case of a total loss, meaning you can buy a new vehicle sooner.

Ridesharing Coverage

Regular auto insurance doesn’t cover rideshare drivers because they are riskier to insure. Ridesharing drivers travel long distances and often enter dangerous areas, increasing their accident and theft risk.

Ridesharing insurance is add-on coverage that pays out when your car is damaged or stolen during your rideshare trips.

How Your Car Insurance Quotes Are Calculated in Newfoundland

Your Newfoundland auto insurance rates are calculated based on your risk profile. If the insurer thinks you’re more likely to get into an accident, your rates will be higher. Unlike most Canadian provinces, your age or gender doesn’t affect your insurance rates, thanks to a bill passed in 2005.

Here are the main considerations when insurers calculate your insurance quotes:

Location

People living in big cities usually get higher car insurance rates because big cities usually have more cars, increasing your accident risk. Big cities also see more crime, increasing your theft or vandalism risk.

Driving Record

Drivers with no accidents or violations to their name usually get low rates because insurance companies don’t take many risks with them. Conversely, drivers with a long history of accidents get hit with higher premiums because insurers are worried they may be repeat offenders.

Vehicle Type

Insurers use the CLEAR scoring system to measure a car model’s accident and theft risk. Naturally, they’ll charge higher rates on vehicles that are notorious for getting stolen or severely damaged in accidents.

Coverage Options Chosen

Extra insurance coverage protects your car and yourself from more dangers but increases your premiums. Consider skipping non-essential coverage to save money on car insurance.

Most Expensive Cities to Insure a Car in Newfoundland

With an annual average of $1,075, Newfoundland lands in the middle of Canada’s car insurance rates. Auto insurance rates in Newfoundland are cheaper than in some other provinces because you’re not required to take accident benefits as part of your mandatory coverage package.

However, there are some cities in Newfoundland where you have to pay more than the average rates, like St. Johns, where the average rate is around $100 more than the provincial average. Here’s a closer look at the most expensive cities for car insurance in Newfoundland:

CityAverage car insurance rate
St. Johns$1,158

Least Expensive Cities to Insure a Car in Newfoundland

Fortunately, some cities in Newfoundland still boast insurance rates well below the provincial average. For example, you can get car insurance in Grand Falls-Windsor and Gander for around a hundred dollars less. 

Here’s a look at the cheapest cities for car insurance in Newfoundland:

CityAverage car insurance rate
Grand Falls-Windsor$877
Gander $867

Car Insurance Cost in Newfoundland by Age

The table below offers a concise overview of car insurance costs by age in Newfoundland. It highlights the varying premiums for different age groups, highlighting the price variance from a young driver compared to an older, more experienced driver.

Age groupAverage costAnnual savings with MyChoice
18-20$3,837$763
21-24$2,193$436
25-34$1,462$290
35-44$1,075$213
45-54$881$175
55-64$749$149
65+$854$169

Car Insurance for Specific Demographics in Newfoundland

All drivers in Newfoundland must have car insurance to drive legally, regardless of age, race, gender, or any other demographic category. But you may be wondering whether specific demographics get special treatment regarding car insurance in the province.

Here’s a look at whether falling into certain demographics changes how you get insurance.

Car Insurance for High-Risk Drivers

Everyone needs car insurance to drive in Newfoundland – even high-risk drivers with a long history of accidents. However, most insurance companies may saddle dangerous drivers with extremely high rates because they’re more likely to get in an accident down the line.

Some insurers specialize in high-risk driver insurance and can issue mandatory coverage to dangerous drivers. These drivers can also buy insurance through the Facility Association, which provides mandatory auto insurance regardless of driving record.

Car Insurance for New Immigrants

As a new immigrant, you can qualify for car insurance by applying with your country of origin’s driver’s licence or an International Driving Permit. However, you still need to get a Newfoundland driver’s licence to drive legally in the long run.

Car Insurance for Students and Seniors

Insurers don’t consider age when calculating Newfoundland car insurance rates, so seniors and students don’t get special treatment. Generally, your driving experience and safety record still determine your rates.

That said, students can offset their inexperience and lower their insurance rates by taking driver’s ed courses.

Car Insurance Cost in Newfoundland by Driving History 

Insurers check your driving history to calculate rates because it often predicts future driving behaviour. That’s why past traffic violations may result in higher insurance rates.

Driving violations stay on your record for years, so your rates will be higher than normal for a long while. Here’s a look at how a bad driving record influences your Newfoundland auto insurance premiums:

Driving violationAverage annual car insurance rate
Clean driving record$1,075
Insurance cancellation due to non-payment$1,763
Licence suspension for alcohol-related offences$1,290
One accident$2,365
Speeding ticket$1,397

Other Factors That Affect Car Insurance Prices in Newfoundland

In addition to the factors we’ve covered above, more things influence your Newfoundland car insurance rates. Here are some of them:

Vehicle Model Age

Old cars usually get higher premiums because they generally have outdated safety features, and spare parts may be harder to find. That’s why vintage car insurance rates are often higher than most policies.

Crime Rates

Living in a high-crime region increases your exposure to theft and vandalism. Insurance companies usually charge more for people in high-crime areas because they’re more likely to have their cars stolen or vandalized.

Loyalty Bonuses

Insurers reward longtime customers for sticking around with discounts and other special offers. Ask your insurer about long-term policyholder rate reductions or discounts.

Other External Factors

Some other factors that may influence your Newfoundland auto insurance rates include:

  • Frequency of extreme weather events
  • Decline in car prices
  • Prevalence of distracted driving

Main Mode of Commuting in Newfoundland

Out of over 179,000 commuters in the province, nearly 90% of them travel by car, truck, or van. Walking and other methods are the second and third-most popular commuting methods in the province, while public transit users only take a 2% share of the province’s commuters. Check the table below to learn more about how Newfoundland commuters travel:

Main mode of commutingCountsRates
Total – 25% Sample Size179,070100.0
Car, truck or van159,14588.9%
Car, truck or van – as a driver143,96080.4%
Car, truck or van – as a passenger15,1908.5%
Public transit3,5802.0%
Walked8,6804.8%
Bicycle2350.1%
Other method7,4354.2%

Commuting Duration in Newfoundland

Over half of Newfoundland’s commuters take under 15 minutes getting to work, which means commute times are generally very short. In fact, 82.5% of the province’s commuters spend under 30 minutes on the road, making commutes of over 30 minutes very rare. Here’s a detailed look at the commute times in Newfoundland:

Commuting durationCountsRates
Total – 25% Sample Size179,070100.0
Less than 15 minutes92,06051.4%
15 to 29 minutes55,76531.1%
30 to 44 minutes15,8258.8%
45 to 59 minutes5,0902.8%
60 minutes and over10,3305.8%

Who Provides Car Insurance Quotes in Newfoundland?

Insurance brokers, agents, aggregators, and direct writers provide car insurance quotes in Newfoundland. Each insurance quote has its own benefits:

Insurance Brokers

Insurance brokers work independently, comparing multiple insurance providers to show you the best deals. Brokers also know the ins and outs of the Newfoundland auto insurance market, so feel free to ask them questions about insurance.

Direct Writers

Direct writers are similar to insurance agents because they work for one carrier. You can’t book a face-to-face meeting with them, but they’re typically cheaper because they don’t operate physical offices.

Insurance Agents

Insurance agents work for a specific carrier, so their policy selection is limited to what the company offers. Fortunately, they offset this limited selection with extensive knowledge of the company’s offerings and can give discounts unavailable to brokers. Agents can also close sales independently, ensuring your policy transaction closes as quickly as possible.

Insurance Aggregators

Aggregator websites like MyChoice compile deals and offer from across the market to help you compare between insurers. Aggregators are completely free for customers, so you can find the best deals without spending a penny.

The Most Common Questions About Car Insurance in Newfoundland

Are Newfoundland drivers allowed to carry digital proof of car insurance?

Newfoundland drivers are allowed to carry digital proof of their car insurance. You can use an eSlip instead of physical insurance proof when a law enforcement officer asks for your documents.

Is there a cancellation of sales tax on car insurance in Newfoundland?

The Newfoundland government cancelled all sales tax on car insurance in 2019.

What is the cheapest car insurance in Newfoundland for new drivers?

The cheapest car insurance in Newfoundland for new drivers will depend on your budget and needs. Use MyChoice to compare insurer offers and find the cheapest policy.

Do I need winter tires in Newfoundland?

Winter tires aren’t required by law in Newfoundland, but the government encourages their use to improve safety.

Does Newfoundland have no-fault insurance?

Newfoundland uses a direct compensation model as part of the no-fault insurance system. This means the person who isn’t at fault for an accident files a claim with their own insurer instead of the at-fault driver’s insurer.

Is there high-risk auto insurance in Newfoundland?

There is high-risk auto insurance in Newfoundland, which you can get from select insurance companies or the Facility Association.

How do I file a car insurance claim in Newfoundland?

You can file a car insurance claim in Newfoundland by contacting your insurer as soon as possible after an accident.

How long do violations stay on my driving record in Newfoundland?

Traffic violations stay on your Newfoundland driving record for two years but can affect insurance rates for longer.

How long do I have to notify my insurance company of vehicle change in Newfoundland?

You have to notify your insurance company immediately when changing vehicles in Newfoundland. Otherwise, you won’t have a valid insurance policy and can’t drive the car.

Is car insurance mandatory in Newfoundland?

Car insurance is mandatory in Newfoundland. Driving without car insurance may result in fines or licence suspensions.

Is insurance on a leased car more expensive in Newfoundland?

Insurance on leased cars in Newfoundland requires $1,000,000 worth of TPL coverage, so it’s more expensive than owned cars.

Is roadside assistance required in Newfoundland?

Roadside assistance isn’t required in Newfoundland, but it’s still highly recommended.

What are the penalties for driving without insurance in Newfoundland?

Driving without insurance in Newfoundland may result in fines, vehicle impoundment, and licence suspensions.

What is the minimum legal driving age in Newfoundland and Labrador?

The minimum legal driving age in Newfoundland and Labrador is 16. If you’re under 19, you also need parental consent before getting a learner’s licence.

What kind of auto insurance system do Newfoundland and Labrador have?

Newfoundland and Labrador have a direct compensation auto insurance system, where the person who isn’t at fault files a claim with their own insurer. 

When did taxes come off auto insurance in Newfoundland?

The Newfoundland government eliminated the retail sales tax on auto insurance in 2019.

Who handles auto insurance complaints in Newfoundland?

Auto insurance companies in Newfoundland usually have a complaints liaison officer or ombudsman to handle complaints.

Who sets auto insurance rates in Newfoundland?

Insurance companies set auto insurance rates in Newfoundland independently, but they must be approved by the province’s Board of Commissioners of Public Utilities.

Why are insurance rates in Newfoundland and Labrador so high compared to the rest of Atlantic Canada?

Insurance rates in Newfoundland and Labrador are high compared to the rest of Atlantic Canada because drivers in the province make lots of claims, meaning insurers need to pay more money for insurance benefits.

Sources

1. Mychoice.ca Internal Data, Most Expensive Cities to Insure a Car, Newfoundland, Car Insurance Quotes Collected, 2024.

2. Mychoice.ca Internal Data, Least Expensive Cities to Insure a Car, Newfoundland, Car Insurance Quotes Collected, 2024.

3. Mychoice.ca Internal Data, Rate Cost By Age, Newfoundland, Car Insurance Quotes Collected, 2024.

4. Mychoice.ca Internal Data, Rate Cost By Driving History, Newfoundland, Car Insurance Quotes Collected, 2024.

5. Statistics Canada, 2021, Census of Population, Newfoundland, Main Mode of Commuting. Data Published March 29, 2023.

6. Statistics Canada, 2021, Census of Population, Newfoundland, Commuting Duration. Data Published March 29, 2023.

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