How Does Car Insurance Work in Nova Scotia

According to our personal injury lawyer in Halifax, car insurance helps financially protect drivers, their passengers, and other victims of car accidents by providing compensation for expenses incurred due to an accident. In Nova Scotia, drivers must have specific insurance coverage, including third-party liability coverage, accident benefits coverage, and uninsured/underinsured motorist coverage. Drivers can also purchase other optional coverages.

Insurers calculate premiums based on the purchased coverages and policy limits, the make and model of insured vehicles, the insured drivers’ histories, and how often and how far they drive. Insurance companies offer discounts for drivers who attend driving schools, put winter tires on their vehicles, or bundle different insurance policies from the same company.

What Is the Minimum Auto Insurance Coverage in Nova Scotia

Nova Scotia law requires drivers to have three types of car insurance coverage: third-party liability coverage, accident benefits coverage, and uninsured/underinsured driver coverage. Third-party liability coverage protects a driver if they cause an auto accident. Third-party liability coverage will cover an accident victim’s medical expenses, vehicle repairs, and lost wages or income when the insured driver hits another vehicle, bicyclist, or pedestrian.

This coverage will also help pay for the insured driver’s legal fees to defend against an accident victim’s claim. In Nova Scotia, drivers must have at least $500,000 of third-party liability coverage. However, drivers can purchase higher coverage limits, with drivers frequently recommended to have at least $1 million in coverage.

Accident benefits coverage helps cover out-of-pocket medical expenses and lost income you and your passengers incur due to auto accident injuries. Coverage can also help pay for housekeeping expenses and contribute to funeral expenses for the victim of a fatal accident. In addition, you can claim accident benefits coverage if you suffer injuries as a pedestrian in a collision with a vehicle. You can file a claim for accident benefits coverage regardless of who caused the accident. Policies must provide up to $50,000 of accident benefits coverage or up to four years of coverage, whichever limit you reach first.

Uninsured/underinsured motorist coverage protects you and your passengers if you get into an accident caused by a driver who doesn’t have insurance or if you otherwise cannot make a claim against the at-fault driver’s third-party liability coverage. You can also use uninsured motorist coverage to obtain compensation after becoming the victim of a hit-and-run accident.

What Other Auto Insurance Coverage Can You Obtain?

Auto insurance companies also offer optional coverages you can purchase with your policy. Although Nova Scotia law doesn’t require you to have these coverages, you may have a contractual obligation to purchase certain optional coverages, such as comprehensive and collision coverages, if you’ve leased or taken a loan out to purchase your car:

  • Collision coverage – Collision coverage can help pay for repairs to your car if it suffers damage in an accident, regardless of fault for the crash.
  • Comprehensive coverage – Comprehensive coverage will help pay for repairs for damage caused by a broader range of non-accident-related causes, such as theft, vandalism, fire, weather, or falling objects.
  • Accident forgiveness coverage – Accident forgiveness coverage can help prevent your insurance claims from increasing if you cause an auto accident.
  • E.F. 44 (Family Protection Endorsement) – Also known as excess coverage, S.E.F. 44 can pay you compensation if the at-fault driver has a third-party liability coverage policy limit lower than your third-party liability coverage limit. S.E.F. 44 will “top up” your compensation up to the limits of your third-party liability coverage.

How Much Is Car Insurance in Nova Scotia Per Month?

Although car insurance rates will vary based on the coverages and policy limits purchased and other factors, average car insurance rates have risen sharply over the past few years. In one recent year, annual auto insurance premiums in Nova Scotia averaged $891, or $74.25 per month, with rates increasing annually between nine to 16 percent. However, some insurers obtained approval to increase their rates by as much as 30 to 50 percent.

What Factors Affect Car Insurance Rates in Nova Scotia?

Insurance companies use multiple data points to calculate a policyholder’s auto insurance premium. Some of the most used factors include:

  • The driving record, age, and experience of each driver on the policy
  • The make, model, and fair market value of each vehicle insured under the policy
  • The vehicle’s safety and theft history
  • How often and far you drive
  • The optional coverages, policy limits, and deductibles you’ve chosen

Drivers can help reduce their car insurance premiums by following these tips:

  • Increase deductibles on coverages; however, an increased deductible will mean a higher out-of-pocket cost for you if you need to file a claim
  • Pay the premium annually rather than quarterly or monthly
  • Insure all of your household’s vehicles together
  • Bundle insurance coverage, such as pairing auto insurance with homeowner’s/renter’s, RV, or boat insurance
  • Install winter tires on your vehicle
  • Drive an electric vehicle
  • Complete a driver’s ed course at a recognized driving school

What Happens If You Drive Without Car Insurance in Nova Scotia?

Nova Scotia law makes it an offense for residents to drive a vehicle without required insurance or to fail to have proof of insurance in the vehicle. Penalties for driving without required car insurance include:

  • Suspension of driving privileges
  • A fine of $1,250 for a first-time offense, which includes a penalty of $1,000, court costs of $100, and a victim-fine surcharge of $150; fines for repeat offenses can reach as high as $5,850

What Happens If I Get Hit by an Uninsured Driver in Nova Scotia?

If you get into an accident with a driver who doesn’t have third-party liability coverage or cannot file a claim against the at-fault driver’s insurance coverage, you can file a claim with your insurance company for uninsured driver coverage. With uninsured driver coverage, your insurance company steps into the shoes of the at-fault driver’s insurer or the insurance that the driver should have had.

You can pursue compensation from your insurer for losses you have the right to recover from the uninsured driver, including out-of-pocket medical expenses, lost income, and vehicle and property damage. In an uninsured driver coverage claim, you will negotiate with your insurance company to resolve your claim or go to court if you and your insurer cannot settle.

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