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What is a car rating and how does it impact my insurance?

Knowing your car rating will help you understand the price of your car insurance premium. When shopping for a car the base model and the top of the line model are not the same prices. This is the same for car insurance. Cars cost different amounts to insure.

What are car ratings?

Car ratings take into consideration the year, make, and model of a car. These ratings are assigned based on claims data that The Canadian Loss Experience Automobile Rating (or CLEAR) system uses to assess the likelihood a car will be involved in a claim and how much that claim will cost.

If your car is at a higher risk of being involved in a claim, it will have a higher CLEAR system rating, and your car insurance premium will be higher.

How are car ratings determined?

The age. The older your car, the less valuable it is. This means it’s less expensive to repair, making it cheaper to insure. Of course, each car depreciates at a different rate, and each car starts with a different value, so the impact on rates varies across different cars.

The make and model. For example, a sedan may have a lower car rating than a coupe because it could be considered sportier and statistically at a higher risk of a claim.

The risk of theft statistics. Certain cars consistently make the “most-stolen” list, so the car rating is higher. 

How will my car rating affect my insurance? 

The lower your car rating, the cheaper your car insurance premium will be, and vice versa.

TIP:  When car shopping, ask for insurance quotes because this will give you a better understanding of how much your car will cost. 

Car ratings are updated yearly, meaning your premium may change even if your record is clean.

How do I find out my car’s rating?

You can find this information on your certificate of automobile insurance or visit the Insurance Bureau of Canada’s website. This may help you during your next car purchase.

There are lots of different factors that are accounted for when calculating your car insurance premium. Learn more about what factors affect your car insurance premium.


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