FAQ

Question

Is it better to opt for a replacement value?

Answer

There is no right answer to this questions. First, it is important to understand the impact of the replacement value.

In the event of a total loss, it allows the owner to replace the damaged vehicle by a new vehicle with the same characteristics, equipment and accessories.

The goal of the insurer is to ensure his client regains the situation he was in before the accident. This way, the car insurance company will not give the client with a new car a better compensation than they would give the client with a 2002 model without the replacement value guarantee. Both are protected.

However, the replacement value can be an interesting option in your contract if:

• You have purchased your vehicle
• You often use it
• The value of your car depreciates quickly
• You are leasing your vehicle and have given a deposit

Another important factor is that the value of the vehicles who are used very often depreciates rapidly and the chance they will be declared to be a total loss after an accident are higher. In this case, the replacement value would be a good option.

Question

What happens if I do not opt for the replacement value?

Answer

The compensation will be evaluated according to the market value of your vehicle. Obviously there will be a difference between the price paid and the amount of the compensation. You will then be able to purchase a new vehicle by adding in some of your own money or the used vehicle of your choice.

Question

If I am leasing my car, should I opt for the replacement value?

Answer

You are never forced to take the replacement value and it is not as profitable for a rented vehicle.

In the event of a total loss, the lease agreement ends. The insurer compensates the car leaser for the value of the car on the day of the accident. The difference between the amount paid by the insurer and the amount the client is taken in charge by the GAP insurance contracted by the leaser. Once the lease agreement is terminated, the client is completely free.

However, if you have made a cash deposit, you must opt for the replacement value in order to regain the deposit in the event of a total loss.

Question

What type of parts will the insurance company have installed on my car after an accident?

Answer

Take, for example, a 2008 vehicle partially damaged in a collision. For all the parts that can’t be replace, the insurer will have the following parts installed:

• Used parts from another similar 2008 vehicle
• If these are not available: Used parts from a similar, more recent vehicle
• If these are not available: New generic parts
• If these are not available: New parts from the car maker

The insurer will never install worn out parts on your vehicle.

Question

I do not have a car anymore and my insurance company is penalizing me for cancelling my contract. Is this normal?

Answer

An insurance policy is a fixed-term contract. When one of the parties wishes to put an end to the contract, there are penalties:

• If the insured terminates the contract: The insurer will use the “short term” termination table. The penalty, according to the type of vehicle and the time of the cancellation, can vary between 5% and 35%. Certain measures can be taken by the insured to avoid this kind of situation, by referring the new owner of the sold vehicle for example.
• The insurer terminates the contract: By ending the contract, the insurer must grant a reasonable period of time to the client in writing. Also, they can’t charge any penalties for the cancellation of an ongoing contract.

Question

Dois-je mentionner à mon assureur que j’ai un dossier criminel ou toute autre condition aggravante?

Answer

Oui. Un assureur a ses obligations, un assuré aussi. L’assuré se doit de mentionner toute situation aggravante à son dossier telle que faillite, dossier criminel, perte de permis de conduire, poursuite potentielle en responsabilité civile, etc.
Si l’assuré oublie de mentionner une condition aggravante, l’assureur pourra, en cas de sinistre, refuser de payer en déclarant que s’il avait été au courant de la situation aggravante, il n’aurait pas accepté le contrat.

Question

Do I have to inform my insurer that I have a criminal record or any other aggravating condition?

Answer

Yes. An insurer has its obligation and so does the insured. It is very important to mention any aggravating condition such as bankruptcy, criminal record, loss of driver’s licence, potential civil liability lawsuits, etc.

If the insured forgets to mention any of this, the insurer can, in the event of a claim, refuse to compensate you by arguing that if he had been aware of the aggravating conditions, he would not have accepted the contract.

Question

If I am not responsible for an accident, does it still affect my record?

Answer

In Quebec, according to the Direct Compensation Agreement, each vehicle owner must declare the damage to their own insurer. The advantages of this are numerous, while the lawsuits, lawsuit fees and settlement delays are minor. There is however a setback. Because your insurer pays for the damage, whether they result from an accident with responsibility or not, your record will be affected. The impact is not the same if you are not responsible but the claim remains in your file for six years and is revised after three years.

Question

What determines who is responsible for an accident?

Answer

This is established by the Direct Compensation Agreement. All insurers in Quebec must abide by it. To learn more on this subject you can consult the Canadian Website for Legal Information.

Question

Following a violent storm, a tree has fallen on my vehicle. Does my insurance cover this type of situation?

Answer

These types of incidents are sometimes called “Acts of God”. We often think they are not covered by an insurance contract. But the term “Act of God” specifically indicates that no one can be held responsible for the damage.

However, if the tree has been dead for a while and already posed a threat before the storm and your neighbour never took care of it, he can be held responsible in a claim.

No matter what the situation is, you must have the “B3 – Accidents without collision” protection to be compensated. If you do not have this protection and you think your neighbour was negligent, you can file a lawsuit against him for civil liability. The process will unfortunately be costly and tedious so it is better to be adequately insured.

Question

Bad road conditions are the cause of my accident. Am I still responsible?

Answer

Yes. The degrees of responsibility in an accident are not determined by atmospheric conditions, precipitations or others. It is the responsibility of the driver to adapt his driving to meteorological events.

Question

The car driver in front of me braked suddenly and for no reason and I didn’t have time to stop. Why am I responsible?

Answer

You must file a police report within 24 hours following the accident. This will save you from being responsible for the damage. However, in order for you to be compensated by your insurer after a hit and run, your insurance contract must have the “B2 Collision” protection. If your documents are handed in on time, you will not be considered responsible.

If your contract does not include the “B2 Collision” protection, it is possible to initiate procedures with the SAAQ. It is not certain that you will be successful and the process can be long and tedious.