Newfoundland and Labrador Car Insurance

Learn about auto insurance in Newfoundland

Newfoundland car insurance rates are the highest in the Maritimes. You pay more for coverage than other drivers in Atlantic Canada. However, insurance is not the most expensive in Canada.

Whether you live in St. John’s, Corner Brook, Mount Pearl, or Conception Bay, you must take action to keep costs down. To find the best auto insurance in Newfoundland, you need to comparison shop.

Here, you will learn how car insurance works in the province and get tips on finding the lowest premiums.

NOTE: Auto insurance is currently not available through ThinkInsure in Newfoundland.

Key takeaways about Newfoundland car insurance

Newfoundland car insurance is slightly more expensive than the Canadian average
Unlike other provinces, accident benefits are not mandatory but are highly recommended
Newfoundland uses a direct compensation model, similar to no-fault insurance.

How does car insurance in Newfoundland work?

A car parked on the side of road with colorful houses.

The province operates using private insurers. Auto insurance in Newfoundland is available through insurance companies and brokers. Insurance premiums are regulated and set by the Newfoundland and Labrador Board of Commissioners of Public Utilities . They must approve all rate increases before insurers can increase premiums.

The Digital Government and Service NL regulates and helps resolve insurance disputes.

Newfoundland car insurance rules

In Newfoundland and Labrador, you are required to have valid insurance. Car insurance is mandatory. You are required to have a minimum of $200,000 in third-party liability coverage. You will need this to register your automobile. Unlike other provinces, accident benefits are not required. However, it is highly recommended.

The province previously operated using a tort system. As of January 2020, residents now deal with their insurance provider for property damage claims. When it comes to recuperating costs that are outside of your plan, you have the right to sue an at-fault driver for pain and suffering, lost income, and other damages.

Does Newfoundland have no-fault insurance?

The province is unique in the way accident fault claims are dealt with. They operate using a direct compensation model. This is part of a no-fault insurance system. Insurance companies use their method to determine which party is at fault for an accident. However, the province does not have no-fault benefits.

When they are not at fault, drivers with property damage claims work with their insurance provider. The insurer for the at-fault party is responsible for paying out the claim.

Can I get temporary car insurance in Newfoundland?

Temporary insurance is not typically offered in Newfoundland. Some insurance companies will issue 6-month policies. A 12-month policy is the standard offering.

What type of car insurance is mandatory in Newfoundland?

Two types of car insurance coverage are mandatory:

Section A – Third Party Liability: You must carry a minimum of $200,000. Property damage claims are capped at $20,000. You have the option to increase your policy limit.
Section D – Uninsured Automobile: Protection for injuries you sustain from a collision with an uninsured driver. You also receive protection for damage to your vehicle if the uninsured individual is at fault.

All other types of coverage are optional but highly recommended.

Optional car insurance in Newfoundland

Newfoundland is the only province where accident benefits are optional. If you choose to purchase them, they will include the following:

Funeral expenses: Up to $1,000.
Medical payments: $25,000/person; time limit of 4 years.
Disability income benefits: Up to $140/week for up to 104 weeks for partial disability. Lifetime for total disability.
Death benefits: Death of head of household $10,000, death of spouse $10,000, death of dependant $2,000.
Right to sue: Yes. Awards are subject to a $5,000 deductible. You also have the right to sue for economic loss.

Other optional plans include:

Collison insurance: Pays for repairs to your vehicle after an at-fault accident.
Comprehensive insurance: Protects protection against theft, weather, vandalism, etc.
All perils: Combines collision and comprehensive.
Specified perils: Covers risks specifically listed in your plan.

Endorsements

You also have the option to add insurance endorsement to your policy to customize it further. The most added riders include:

SEF 44 – Family protection.
SEF 39 – Accident forgiveness.
SEF 27 - Damage liability for non-owned automobiles.
SEF 5 – Loss of use, rental car.

Speak with your insurance company about endorsements that would make sense for your driving requirements.

How much is car insurance in Newfoundland?

The Average cost of car insurance in Newfoundland is $1,251 per year. This works out to about $104 per month. Costs have consistently risen year over year. Costs are higher in larger cities such as St. Johns, Conception Bay, and Mount Pearl.

How do Newfoundland auto insurance rates compare to other provinces?

Newfoundland auto insurance rates are right in line with the average rates in Canada ($1,244). Car insurance in Ontario, B.C., Alberta, and Saskatchewan are the only provinces with higher rates.

How do I get affordable car insurance in Newfoundland?

Insurance is a personalized solution. No two individuals have the same needs or rates. What we all have in common is the desire to get affordable insurance. Fortunately, there are several things you can do to lower your costs. Try the following to save more:

Compare policy options: Compare policies from the top insurance companies to find the most affordable solutions.
Try out a car insurance calculator: Use a calculator to better understand your options and the factors that affect how much you pay.
Use winter tires: Insurers are now required to offer you a discount if you install winter tires.
Try usage-based insurance: Usage based insurance is an ideal option for people who do not drive a lot.
Inquire about discounts: Speak with your insurance company to see if you qualify for any new insurance discounts.
Combine coverage: Combine your home/renters coverage with your auto policy. If you have multiple vehicles, insure them with the same insurance company through an insurance bundle.

What factors affect car insurance premiums in Newfoundland and Labrador?

Insurance providers use a long list of considerations to calculate your premiums. Some of these factors you can manage, while others you cannot. Here are the top things that play a role in setting your insurance rates:

Your location: City, neighbourhood, postal code.
Driving history: Driving record, claims-free status, tickets, years licenced.
Your vehicle: Make and model, how much you drive, who you use your vehicle (business, pleasure, commute).

Factors that do NOT impact car insurance in Newfoundland

Newfoundland insurers consider fewer factors than other provinces when setting insurance premiums. Some common factors used to set rates in other provinces are not applicable here. They include:

Age
Gender
Marital status
Insurance history or lapse (except for licence suspension and traffic violations).
Accidents where you are not at fault
Previously being denied coverage or having coverage with the Facility Association

Newfoundland car insurance FAQs

Are accident benefits mandatory in Newfoundland?

No. Unlike other provinces, accident benefits are optional. Even though you do not have to add them to your plan, it is recommended by insurers to provide you with additional protection if you are involved in a crash.

How long do you have to report an accident to insurance in Newfoundland?

You have up to 2 years to file a claim after an accident. However, due to legislative changes to the Automobile Insurance Act in 2020, all accident victims must provide legal notice of their intent to file a claim within 120 days of the accident. If you fail to give proper notice, it could impact how much you receive for compensation.

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

Newfoundland operates using a demerit points system. Any points you accumulate on your record will be removed two years from the date of the conviction.

What is the penalty for driving without insurance in Newfoundland?

Uninsured driving is an issue in Newfoundland. The province has the most uninsured drivers in Canada. If you are caught driving without insurance, you will face a fine of $2,000-$4,000 for your first offence. Fines increase to $3,000-$5,000 for additional offences. You could also have your licence suspended and your vehicle impounded for 90 days.

Is there an auto insurance tax in Newfoundland?

As of July 1, 2016, all new or renewed policies were subject to a 13% retail sales tax (RST). However, to reduce the province's insurance cost, the province chose to eliminate the tax, effective January 1, 2019. All current policies are not subject to RST.

How do I get a driver's licence in Newfoundland and Labrador?

Newfoundland uses a Graduated Licencing Program. You must complete all phases of the program to become a fully licenced driver.

Learner's Class 5: This is your level one licence. You must be 16 years old and have parental consent if you are under 19. You will have to pass a road test about the rules of the road. You must be accompanied by a Class 5 driver and display a novice driver sign in the rear window. Zero BAC.
Novice Driver: You must have had the level one licence for one year, or 8 months if you completed driving school. You must pass a road test. Zero BAC.
Class 5 Regular Licence: You must have your level 2 licence for 12 months.

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