# Auto Insurance Liability Coverage - $1 million or $2 million?



## CanadianCapitalist

For auto insurance, what do you guys have by way of 3rd party liability coverage? For a while now, insurance companies are offering either $1 million or $2 million coverage. According to Belair Direct, 80 percent of Ontario drivers still pick $1 million liability insurance. For me, opting for $2 million will cost 12% more. I'm trying to decide which one to go with and am interested in hearing your thoughts.


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## rikk

CanadianCapitalist said:


> For auto insurance, what do you guys have by way of 3rd party liability coverage? For a while now, insurance companies are offering either $1 million or $2 million coverage. According to Belair Direct, 80 percent of Ontario drivers still pick $1 million liability insurance. For me, opting for $2 million will cost 12% more. I'm trying to decide which one to go with and am interested in hearing your thoughts.


My policies are coming up ... I've put in a request for information on "umbrella insurance". This coverage would be for my home, car, boat and would kick in should a claim against any one of the aforementioned be exceeded. You might consider looking into that ... I'm guessing it would be for $3M in which case the others I'd set at $1M ... tbd


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## NorthernRaven

If you use rental car agencies in places that don't include liability cover (such as the US), you might want to check if your insurance covers rentals. If you use this feature, the larger coverage option might give peace of mind when renting in lawyer-infested America... 

I don't know if one's own auto insurance acts as secondary cover where a rental comes with liability coverage (as required in Canada).


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## rikk

rikk said:


> My policies are coming up ... I've put in a request for information on "umbrella insurance". This coverage would be for my home, car, boat and would kick in should a claim against any one of the aforementioned be exceeded. You might consider looking into that ... I'm guessing it would be for $3M in which case the others I'd set at $1M ... tbd


Alrighty then ... for me umbrella coverage for home, jeep, boat is ... $201 for $3M, $234 for $4M, and $267 for $5M ... I'm taking the $3M at $201 ... enjoy the day :encouragement:


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## Sampson

interesting question. anyone know the distribution of $ figures in at-fault auto insurance claims? $1m for example probably does not cover the lives of 4 people?


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## peterk

Wouldn't the choice mostly rely on your income and assets? The only way anyone's going to get your money is by suing you and your insurance company.

If someone has a 2m claim on you, and you have 1m insurance coverage, a mortgage and a 50k RRSP, you're going to get sued for 1m. If you have 1m insurance coverage, a mansion and 1m in the bank then they're gonna come after you for the full 2m...


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## sags

The decision on how much liability insurance to carry..........may also be affected by who drives under the policy.

Teenage or young adult drivers?................more potential risk than an older, mature person who putts around town.


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## m3s

Why do teenagers matter here, can someone actually sue a teenager with no income for $2 million? The $1 mil required by law should be all that is required? Seems like paying for more is out of the goodness of your heart, more capitalist of the insurance company

I know of many rich people who don't pay for insurance as they can cover the legal requirements themselves. The insurance companies charge enough to cover the risk. The government doesn't pay for insurance either. Never pay for more than you need or you are losing out in the long run imo


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## Cal

I have 1 million liability coverage. But I don't even know if my insurer offers 2 million.

I renew in a couple of months, and will look into this myself.

Thx for the heads up CC.


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## My Own Advisor

We've got $1 M on our policy.

Check out:
http://www1.johnson.ca/

We're pretty happy with them.


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## Worm

1 Million doesn't go very far in a serious auto accident these days, loss amounts can and do exceed this. I recomend at least 2MM to my friends and family, I think 5MM is even better. For me the increased cost is very cheap knowing I'm covered.


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## mind_business

If you do any amount of driving in the US, I would recommend going with the $2million liability. If you drive exclusively in Canada, which isn't realistic for most of us, $1million is more than enough.


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## m3s

Seems like the insurance salesmen are excellent fear mongers?

I'm no expert on the States, but a few minutes of googling and many insurance companies are peddling "uninsured/underinsured" coverage? They claim that you have no recourse if someone is underinsured, so you should insure yourself for the underinsured?.. The typical legal minumum in the States is $25k.... the highest I see is $100k. In Canada I thought the requirement was $1 mil but now I'm seeing $200k ($50k in Quebec).. and we have free healthcare etc.

Anyways I don't plan on drunk driving or running over any pedestrian medical students, and if so I fully deserve to be bankrupt imo


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## financialnoob

This is an older article talking about a $215,000 fender bender. However, new reforms took effect a few months afterwards so not sure what impact they may have had.

Mind-bending fender-benders fuel insurance costs



> In Toronto alone, there were 46,484 traffic accidents to the end of November, an average of 139 daily, police say.
> 
> The average auto accident injury claim in Ontario is $56,000, five times higher than the average in other provinces where accident benefit levels are often lower.


I believe the average claim is lower in BC and some provinces that have provincial auto insurance, as they set limits a long time ago on various items. Ontario was really slow because auto insurance companies didn't really care, they would just pass the cost onto the consumers. It wasn't until fraud became a billion dollar problem that they thought to do something... :hopelessness:

The odds are never going to be 0% that the extra million won't help that one time, but if you're not doing a lot of driving in the US, or you do lots of city driving where you never go fast enough to even cause much damage, it's probably not worth it.


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## Maybe Later

For us, we looked at what the required coverage levels were in the provinces where we travel often. In our province basic liability is less than $1M, but we chose the coverage that at least equals the minimum liability in the provinces where we travel often to see family. The reasoning being that here where everyone is covered by a crown corporation additional liability coverage above the basic isn't as important as having at least the minimum for all the other places we travel regularly. I don't recall if we have $1M or $2M.


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## RBull

2 million here on home and on autos. 1 million isn't a lot these days when you look at the potential earning power, assets etc of people today.

It's a small price for a little extra peace of mind and I'm not comfortable having minimum government standards dictate my coverage.


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## Eclectic12

mode3sour said:


> Seems like the insurance salesmen are excellent fear mongers?
> 
> I'm no expert on the States, but a few minutes of googling and many insurance companies are peddling "uninsured/underinsured" coverage? ...


It depends on the state and how much things have changed. 

When my parents bought a trailer/sun room in Florida, it puzzled me to hear so often at the weekly coffee/announcements meeting comments that "if you get hit, hope it's a Canadian".

Then the local paper then published as survey of Americans on the question of car insurance, where the results were that 96% did not have coverage. At that point, the conversations made a lot more sense.


Cheers


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## sags

mode3sour said:


> Seems like the insurance salesmen are excellent fear mongers?
> 
> I'm no expert on the States, but a few minutes of googling and many insurance companies are peddling "uninsured/underinsured" coverage? They claim that you have no recourse if someone is underinsured, so you should insure yourself for the underinsured?.. The typical legal minumum in the States is $25k.... the highest I see is $100k. In Canada I thought the requirement was $1 mil but now I'm seeing $200k ($50k in Quebec).. and we have free healthcare etc.
> 
> Anyways I don't plan on drunk driving or running over any pedestrian medical students, and if so I fully deserve to be bankrupt imo


Insurance won't cover liability when the insured is drunk driving.

In Ontario, it is a legal requirement to have insurance. The minimum fine is 5,000 and possible jail time. A vehicle ownership can't be changed or annual registration stickers purchased without proof of insurance. Even to have insurance coverage, but not have the information in the car is an infraction.

Insurance is insurance........so most of the time it doesn't get used to the maximum.

But when it does...............it can save a lifetime of financial sorrow.

Judgements aren't dismissed by bankruptcy.........and future income could be at risk.

It is a risk to have less insurance..........but each person has to make that decision.


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## CanadianCapitalist

NorthernRaven said:


> If you use rental car agencies in places that don't include liability cover (such as the US), you might want to check if your insurance covers rentals.


Good point about the US. One would think that even if you drive your own car, you may want enough liability coverage.



rikk said:


> Alrighty then ... for me umbrella coverage for home, jeep, boat is ... $201 for $3M, $234 for $4M, and $267 for $5M ... I'm taking the $3M at $201 ... enjoy the day :encouragement:


Thanks for pointing out umbrella coverage. Did not know that it even existed. 



Sampson said:


> interesting question. anyone know the distribution of $ figures in at-fault auto insurance claims? $1m for example probably does not cover the lives of 4 people?


In this case, even $2 million likely may not go far. 



peterk said:


> If someone has a 2m claim on you, and you have 1m insurance coverage, a mortgage and a 50k RRSP, you're going to get sued for 1m. If you have 1m insurance coverage, a mansion and 1m in the bank then they're gonna come after you for the full 2m...


I'm not sure if this is quite true. Is it not possible for one's wages to be garnisheed to pay for any liability award? Also, aren't RRSPs now out of the grasp of creditors?


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## SpIcEz

sags said:


> Judgements aren't dismissed by bankruptcy.........and future income could be at risk.


I believe you are wrong on this point.


> Most debts are erased by the bankrupt's discharge except for the following:
> 1.	Fines imposed by a Court;
> 2.	Money owing for things stolen;
> 3.	Things obtained by misrepresentation;
> 4.	Alimony or maintenance payments.
> 5.	Award of damages by a court for intentionally inflicting bodily harm or sexual assault.
> 6.	Student loans if bankruptcy is filed prior to or within seven years after the finish of studies.


Fines by a court does not mean judgement.

I know that court judgements for DUI or intentional damages caused wouldnt be erased.
But I am almost certain, something like an accident would be erased.

Also, people need to take their provinces under consideration. For example, here in Quebec, you are only liable for property damages (that means the vehicles and other property you might have hit, like a lamp post, building wall, etc...) everything else is covered by the SAAQ (the provinces insurance, which you pay with your drivers license.)

In that light, 2M$ is overkill.


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## OhGreatGuru

If your home insurance is through the same company or broker as your car insurance, you may be able to buy additional "Umbrella" coverage to both policies for a reasonable price. The base liability coverage on my home & car insurance is $1M, but I have an umbrella that adds $1M to both. I added it a few years ago when I realized my $1M coverage hadn't been increased for nearly 30 years.


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## sags

Assuming court judgements of more than 1 Million dollars would probably involve wrongful death or bodily harm caused by misconduct, they would not be erased by bankruptcy.


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## anabum22

*Safe Driving Rewarded*

If you are a safe driver i would suggest going for a 500 thousand dollar deductible and save yourself more money. How much does running into a mailbox cost these days anyways?:biggrin::biggrin:


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## albertkao3

SpIcEz said:


> I believe you are wrong on this point.
> 
> 
> Fines by a court does not mean judgement.
> 
> I know that court judgements for DUI or intentional damages caused wouldnt be erased.
> But I am almost certain, something like an accident would be erased.
> 
> Also, people need to take their provinces under consideration. For example, here in Quebec, you are only liable for property damages (that means the vehicles and other property you might have hit, like a lamp post, building wall, etc...) everything else is covered by the SAAQ (the provinces insurance, which you pay with your drivers license.)
> 
> In that light, 2M$ is overkill.


I live in Ontario. I only drive to Ontario and Quebec. I do not drive to US.
Is Auto Insurance Liability Coverage $1 million enough?


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## Mukhang pera

albertkao3 said:


> I live in Ontario. I only drive to Ontario and Quebec. I do not drive to US.
> Is Auto Insurance Liability Coverage $1 million enough?


How high is up?

Sorry to come across as snide to a forum newcomer. So, to show proper manners, allow me to bid you welcome to the forum.

Now, getting back to snide.:joyous:

What constitutes "enough" can depend on a range of factors. For openers, if you have limited income and assets and are essentially "judgment proof", I would say just sign up for the statutory minimum. Liability insurance is to protect you from having to pay any judgment against you. But if you have no ability to pay to begin with, no need to worry.

Some interesting posts have been made to this thread, such as:



m3s said:


> Why do teenagers matter here, can someone actually sue a teenager with no income for $2 million? The $1 mil required by law should be all that is required? Seems like paying for more is out of the goodness of your heart, more capitalist of the insurance company
> 
> I know of many rich people who don't pay for insurance as they can cover the legal requirements themselves. The insurance companies charge enough to cover the risk. The government doesn't pay for insurance either. Never pay for more than you need or you are losing out in the long run imo


Yes Virginia, a teenager may be sued for $2 million or any amount. Being a teenager does not mean one may wreak havoc on the roads with impunity. That is why legislation in all provinces makes the owner and driver liable for accident damages. In a lawsuit, the owner and driver will be named as defendants and they will be jointly and severally liable. That is why in most places, insurance attaches to the vehicle, not to the driver. But the personal characteristics of the "principal operator" will affect the premium to be paid.

I am a bit startled by the proposition that "many rich people" do not protect themselves with motor vehicle liability insurance. The cost is relatively modest (except, perhaps for someone with an abysmal driving record) and I am surprised that rich people would sooner risk having to cut a cheque for a million bucks or so than pay a couple hundred a year in extra insurance costs. In my case, I am not rich and I don't know a lot of rich people. Those that I know have never discussed their insurance-purchasing practices with me, so I have no idea what coverage they obtain for themselves. Where I come from, it would be impolite to ask.

The writer admonishes "Never pay for more than you need" and appears to suggest that insolvent folks such as teenagers have little need of insurance and rich people prefer to live without. That leaves some folks in the middle who should buy adequate coverage, "adequate" meaning adequate to their circumstances.



sags said:


> Insurance won't cover liability when the insured is drunk driving.


Well, I'll trust that to be the case where sags lives, but it is out of step with the Canadian provinces with which I am familiar. Here, in B.C., driving drunk is a breach of one's insurance policy, forfeiting coverage. The injured party will still be paid by the insurer to the full extent of the policy. But the insurer will have the right to recover against the drunk driver insured. But should that person be a man of straw, the insurer will recover nought.



sags said:


> Insurance is insurance........so most of the time it doesn't get used to the maximum.
> 
> But when it does...............it can save a lifetime of financial sorrow.


Agreed.



sags said:


> Judgements aren't dismissed by bankruptcy.........and future income could be at risk.



That is not the law as I apprehend it. Perhaps sags will return to this thread and provide some legal authority for that proposition. So far as I know, the only judgments not released are those few described in s. 178 of the Bankruptcy and Insolvency Act.



sags said:


> Assuming court judgements of more than 1 Million dollars would probably involve wrongful death or bodily harm caused by misconduct, they would not be erased by bankruptcy.


Again, this represents a statement as to the law of bankruptcy that casts too wide a net. Under s. 178 of the BIA, what is not released is limited to: (a.1) any award of damages by a court in civil proceedings in respect of

(i) bodily harm intentionally inflicted, or sexual assault, or

(ii) wrongful death resulting therefrom;

Many judgments for "wrongful death" would be released, such as those actionable under the B.C. Family Compensation Act.

As for what is takes these days to see one facing a million-dollar judgment, one does not have to work too hard at it. 

Here's a typical recent B.C. case arising from a minor rear end collision, of the sort that happens many times a day across Canada:

PERSONAL INJURY QUANTUM — Neck, shoulder and arm — • Thoracic outlet syndrome • Loss of future earnings • Future care costs • Loss of homemaking capacity — Plaintiff, then age 18, suffering soft tissue injuries 2012 rear end motor vehicle accident — At trial in 2017, plaintiff having ongoing symptoms affecting primarily her neck, left shoulder and arm and suffering from thoracic outlet syndrome — Plaintiff’s injuries precluding her goal to become a teacher or counsellor — Court awarding damages of $703,321 including non-pecuniary damages of $110,000, past income loss of $35,000, loss of future earning capacity of $500,000, future care costs of $13,805 and loss of homemaking capacity of $26,500. 

Downey v. O'Conor

http://www.courts.gov.bc.ca/jdb-txt/sc/17/14/2017BCSC1459.htm


It's not all that difficult to get into multi millions. The case below involves an assessment of damages - for future care costs only - for someone who became a paraplegic at age 52. Had the plaintiff been younger, the costs would have increased proportionately. The other aspects of the claim were settled. Non-pecuniary damages would have been at least $350,000 and there may well have been sizeable amounts for past income loss and loss of future earning capacity.


PERSONAL INJURY QUANTUM — Paraplegia — • Future care costs — Plaintiff suffering spinal cord injury in 2009 at age 52 — Injury leaving her paralyzed from the waist down — At 2015 trial to assess damages for future care costs, court awarding $4.5 million, including $3,135,902 for home care.

Warick v. Diwell

http://www.courts.gov.bc.ca/jdb-txt/sc/17/00/2017BCSC0068.htm

So, Albertkao3, where do you fit in? A pauper with nothing to lose? A deep pocket type for whom even the largest personal injury judgment is but a mere bagatelle and who, like the heavy wallet brigade with whom m3s associates, scoff at the notion of insurance? In the middle, like most of us, with something to protect but lacking in sufficient resources to self-insure? That describes me. I carry $3 million.

Where I save money is on collision coverage. I have owned both new and used vehicles. I keep collision coverage on new vehicles until they are 3 years old. By then they are fully depreciated and coverage will cost more than the vehicle is worth. Well, maybe a bit of an exaggeration, but you get the idea. Also, I would probably not bother on a vehicle worth less than $25,000. I do not mind self-insuring to that level.


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## Ag Driver

Deleted


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## nathan79

So... if I'm understanding this thread correctly, you only need liability insurance equal to your net worth?

I currently carry 3M here in BC. When I started driving in the late 90's I carried 1M, but the agent would always suggest buying more. When I asked what for, they just said that judgements kept getting more expensive. I was never asked my net worth or any personal information. When I upgraded to 3M a few years ago, I was told that a lot of people are carrying 5M now. Well, I guess that could come in handy in Vancouver where your house alone could be worth over 3M.


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## latebuyer

Thanks for posting those court cases, Mukhang. My dad is a lawyer and he also recommended higher liability. I believe i have 3 million. As i recall it wasn't even that much more expensive. Definitely worth it for peace of mind. I'm in bc too.


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## Ihatetaxes

I’ve had $2m for years but early 2017 added a $5m general liability umbrella to my home/auto policies for $344/year. I’ve also got $5m liability and separate $5m errors and omissions policy for my business. Maybe excessive but I call it good protection for my family and employees futures. Lots of larger corporate clients require us to have $5m of liability to do business with them anyway.


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## m3s

Mukhang pera said:


> What constitutes "enough" can depend on a range of factors. For openers, if you have limited income and assets and are essentially "judgment proof", I would say just sign up for the statutory minimum. Liability insurance is to protect you from having to pay any judgment against you. But if you have no ability to pay to begin with, no need to worry.
> 
> Yes Virginia, a teenager may be sued for $2 million or any amount. Being a teenager does not mean one may wreak havoc on the roads with impunity. That is why legislation in all provinces makes the owner and driver liable for accident damages. In a lawsuit, the owner and driver will be named as defendants and they will be jointly and severally liable. That is why in most places, insurance attaches to the vehicle, not to the driver. But the personal characteristics of the "principal operator" will affect the premium to be paid.


Virginia? You assume teenagers don't own vehicles. I'm glad that we in Canada can sue spoiled kids rich parents if required but I bought my own beater at 16 and paid the insurance premiums myself with earned money. I sure as hell as a teenager wasn't paying anything more than the required $1M liability and I don't see why I would. The premiums for anything more as a male teenager driving a 2 door manual, which apparently equates to a sports car, cost more than the vehicle was worth itself.. Maybe if we had non discriminatory insurance like in civilized european countries. If my name was in fact Virginia I'd pay half the insurance here regardless of driving historty.



Mukhang pera said:


> I am a bit startled by the proposition that "many rich people" do not protect themselves with motor vehicle liability insurance. The cost is relatively modest (except, perhaps for someone with an abysmal driving record) and I am surprised that rich people would sooner risk having to cut a cheque for a million bucks or so than pay a couple hundred a year in extra insurance costs. In my case, I am not rich and I don't know a lot of rich people. Those that I know have never discussed their insurance-purchasing practices with me, so I have no idea what coverage they obtain for themselves. Where I come from, it would be impolite to ask.


You can google the pros and cons of self-insurance. It's a thing and it makes sense for some. The government and large corporations will self-insure. The mega rich can self-insure. I don't know the magic number where it becomes sensible to self insure but it exists more and more with today's decreasing wealth distributions. I imagine if the law states $1M liability then $1M cold hard cash in your account would fit the legal requirement. Why waste your time in court battling insurance companies when you can just buy the insurance company instead. Finding an insurance company that operates at a loss would be like finding a casino operating at a loss..



Mukhang pera said:


> Where I save money is on collision coverage. I have owned both new and used vehicles. I keep collision coverage on new vehicles until they are 3 years old. By then they are fully depreciated and coverage will cost more than the vehicle is worth. Well, maybe a bit of an exaggeration, but you get the idea. Also, I would probably not bother on a vehicle worth less than $25,000. I do not mind self-insuring to that level.


Exactly. I just don't buy new vehicles and I've never wasted money on collision insurance. I do get all-perils coverage


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## Mukhang pera

latebuyer said:


> Thanks for posting those court cases, Mukhang. My dad is a lawyer and he also recommended higher liability. I believe i have 3 million. As i recall it wasn't even that much more expensive. Definitely worth it for peace of mind. I'm in bc too.



Most welcome, latebuyer. Yes, upping liability coverage - at least here in B.C. - is not an expensive undertaking.



nathan79 said:


> So... if I'm understanding this thread correctly, you only need liability insurance equal to your net worth?


Well, covering net worth can be a useful yardstick (or is that meterstick?). But what you choose will be multifactorial, including considerations of income and assets, now and reasonably expected, your tolerance for risk, ability to pay higher premiums, the magnitude of judgments being handed down by the courts in your jurisdiction, etc. Simply looking at net worth might yield some odd results. The driver with a net worth of $50 million probably does not need to insure his motor vehicle liability to the tune of $50 million.




m3s said:


> Virginia? You assume teenagers don't own vehicles. I'm glad that we in Canada can sue spoiled kids rich parents if required but I bought my own beater at 16 and paid the insurance premiums myself with earned money. I sure as hell as a teenager wasn't paying anything more than the required $1M liability and I don't see why I would. The premiums for anything more as a male teenager driving a 2 door manual, which apparently equates to a sports car, cost more than the vehicle was worth itself.. Maybe if we had non discriminatory insurance like in civilized european countries. If my name was in fact Virginia I'd pay half the insurance here regardless of driving historty.


I am not sure what I said that would lead one to infer that I assume that teenagers do not own vehicles. 

I believe you are wrong in making the broad statement that "we in Canada can sue spoiled kids rich parents if required". It is not part of the common law that parents are vicariously liable for the torts of their children under the age of majority. There are some exceptions created by statute, such as the B.C. Parental Responsibility Act, which is very limited in scope and amount recoverable. There are few cases under the Act, which became law in 2004. While I cannot conjure up a live link, one of a few cases that can be found on the Provincial Court website can be turn up by following the link below, then click on "Search Judgments" and, in the box that asks for case name, citation or docket type: 2004 bcpc 410

http://www.provincialcourt.bc.ca/judgments.php

As for there being any point in suing a penniless teenager, I would note that Vancouver has become somewhat famous (or infamous) for its streets becoming a playground for weather teenagers and their hot cars. No beaters for them. Here's one article on the topic:

https://jalopnik.com/5836880/thirteen-supercars-in-rich-kid-street-race-could-be-seized-and-sold

Perhaps those teens should carry more than the statutory minimum liability insurance. You mention it being $1 million where you live. Here in B.C. it's only $200,000.

Another reason for a teenager or anyone of limited means to consider taking out more than minimum insurance is to protect future wealth. Let's posit the case of the impecunious youngster who reads diligently here on cmf and becomes an investment guru, ending up with a net worth of $10 million by age 23. That $2 million judgment against said youngin' is still lurking out there. Here in B.C., a judgment is good for 10 years. It does not then necessarily expire. It may be sued upon and then it's good for another 10 years (Limitation Act, s. 7). So, if you are poor today, unless you remain resolute in your vow of poverty, you might just have to pay the piper someday. Even if you do not pull yourself up by your bootstraps, you might inherit wealth from your boomer parents and the judgment creditor will swoop in and make off with the spoils.

As an interesting aside, in B.C. we have legislation I suspect 99% of parents do not know about. A statutory pitfall found in s. 10 of the School Act. Here's a recent example:

Nanaimo-Ladysmith School District No. 68 v. Dean 

NEGLIGENCE — Children — Duty of parents — • EDUCATION — Students — Liability — School Act, s. 10, which imposes liability on student and parents for damage caused by the student’s intentional or negligent acts, does not require proof that the student intended to cause damage by his actions — Student and parents liable for damage caused when student activated school’s sprinkler system when he attached his friend’s padlock to a sprinkler head — Court also analyzing the student's duty of care, and finding him negligent.

http://www.courts.gov.bc.ca/jdb-txt/SC/15/00/2015BCSC0011.htm

As for the reference to "Virginia", I expected only a few to catch on. It's a reference to a bygone era. 

Today is Christmas Eve. Given the timing, perhaps the story is deserving of more than passing mention. It has a certain timeless quality and the words written in that time that none of us can remember ring as true now as they did then. Time has served only to enhance their meaning.

In September 1897, Francis Church, a former Civil War correspondent and editor at the New York Sun, received a letter from then 8-year-old Virginia O’Hanlon. In her letter, Virginia wrote:

Dear Editor, 
I am 8 years old. Some of my little friends say there is no Santa Claus. Papa says, "If you see it in the Sun, it's so." Please tell me the truth, is there a Santa Claus? 
Virginia O'Hanlon
115 West Ninety-Fifth Street

The answer, as published, reads thus:

Virginia, your little friends are wrong. They have been affected by the skepticism of a skeptical age. They do not believe except [what] they see. They think that nothing can be which is not comprehensible by their little minds. All minds, Virginia, whether they be men's or children's, are little. In this great universe of ours man is a mere insect, an ant, in his intellect, as compared with the boundless world about him, as measured by the intelligence capable of grasping the whole of truth and knowledge.

Yes, Virginia, there is a Santa Claus. He exists as certainly as love and generosity and devotion exist, and you know that they abound and give to your life its highest beauty and joy. Alas! how dreary would be the world if there were no Santa Claus. It would be as dreary as if there were no Virginias. There would be no childlike faith then, no poetry, no romance to make tolerable this existence. We should have no enjoyment, except in sense and sight. The eternal light with which childhood fills the world would be extinguished.

Not believe in Santa Claus! You might as well not believe in fairies! You might get your papa to hire men to watch in all the chimneys on Christmas Eve to catch Santa Claus, but even if they did not see Santa Claus coming down, what would that prove? Nobody sees Santa Claus, but that is no sign that there is no Santa Claus. The most real things in the world are those that neither children nor men can see. Did you ever see fairies dancing on the lawn? Of course not, but that's no proof that they are not there. Nobody can conceive or imagine all the wonders there are unseen and unseeable in the world.

You may tear apart the baby's rattle and see what makes the noise inside, but there is a veil covering the unseen world which not the strongest man, nor even the united strength of all the strongest men that ever lived, could tear apart. Only faith, fancy, poetry, love, romance, can push aside that curtain and view and picture the supernal beauty and glory beyond. Is it all real? Ah, Virginia, in all this world there is nothing else real and abiding.

No Santa Claus! Thank God! he lives, and he lives forever. A thousand years from now, Virginia, nay, ten times ten thousand years from now, he will continue to make glad the heart of childhood.


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## james4beach

A question for you guys regarding car insurance on rental cars. I don't own my own car, so I don't have regular car insurance.

I rent cars on the rare occasion that I need a car, and usually this is in the US. I always get the third party liability insurance (aka Supplemental Liability Protection) with 1M coverage. Collision insurance is no big deal and covered by my TD VISA. I have a positive net worth in the hundreds of K and ability to earn significant income, so I am interested in solid liability protection.

Is the rental car agency's 1M insurance good enough? Will it actually protect me if an American sues me? I've also looked into getting my own car insurance without owning a car. In the US, I inquired with Geico (as I have a US residence) but the cost was just as high as paying $15/day to the rental car agency for their 1M coverage - expensive!

Basically I'm wondering if 1M through the car rental agency is enough or if I should go for 2M, and if so, where on earth do I get that kind of insurance if I don't own a car? I am a Canadian resident and have a Canadian drivers license, so perhaps you can suggest somewhere in Canada that will let me insure rental cars even though I don't own a car.


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## Mukhang pera

I cannot answer that one, james.

CAA or AAA might have some ideas.


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## james4beach

I just learned that my home insurer offers "Personal Umbrella" liability insurance, which can add on 1M, 2M etc on top of my existing home insurance.

But the surprising part was that, according to the insurance rep, this "umbrella" insurance also follows me anywhere in the world, including in rental cars.

I don't own a car, so I don't have any car insurance. For many years, I've been wondering how to get my own liability policy that will protect me in case of a car accident and lawsuit. Now it sounds like the umbrella insurance (*under home insurance*) can do this.

@Mukhang pera does that sound right to you? Could it be that simple?


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## Synergy

^ I was under the impression that you need an underlying auto policy in order for the umbrella to cover rental car insurance (physical damage), liability, etc. I could be wrong as there are a lot of different types of policies available. Umbrella is typically a stand along policy, separate from your home, auto etc. You can purchase it from a completely different company than your home insurer. Individuals with lots of stuff and / or high exposures, the umbrella is often cheaper than adding increased limits to all the individual items. You could have a 5 million umbrella and the underlying items (home, auto, boats, cottage, vacant land, motorcycle, atv, etc) could all have a base of 1 or 2 million. Cheaper than paying for 5 million on each.


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## james4beach

Synergy said:


> ^ I was under the impression that you need an underlying auto policy in order for the umbrella to cover rental car insurance (physical damage), liability, etc. I could be wrong as there are a lot of different types of policies available. Umbrella is typically a stand along policy, separate from your home, auto etc.


I am not familiar with this kind of policy either. Mine is stand-along, and coupled to my existing home insurance. When I log into my insurer's web site, I see it listed as an item within my home insurance.

I told the agent (several times to be clear) that I don't have any car insurance and she said that it still covers me for liability when in a rental car, or in other motor crafts (boat etc).

It seemed surprisingly affordable. I could easily add on another million or two for not too much of a premium increase. I'm just suspicious that this seemed a bit too easy.


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## Synergy

james4beach said:


> I am not familiar with this kind of policy either. Mine is stand-along, and coupled to my existing home insurance. When I log into my insurer's web site, I see it listed as an item within my home insurance.
> 
> I told the agent (several times to be clear) that I don't have any car insurance and she said that it still covers me for liability when in a rental car, or in other motor crafts (boat etc).
> 
> It seemed surprisingly affordable. I could easily add on another million or two for not too much of a premium increase. I'm just suspicious that this seemed a bit too easy.


Your agent is likely correct. You can easily confirm this by reading the policy wordings. Check to see if you would be covered for the physical damage to the actual rental vehicle you are driving. Typical auto insurance only covers this is you have a special endorsement added. If there is coverage check to see if there's a limit on the value of the vehicle you'd be covered for. Best to read the policy with a fine tooth comb so there is no surprises.


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## james4beach

Synergy said:


> Check to see if you would be covered for the physical damage to the actual rental vehicle you are driving. Typical auto insurance only covers this is you have a special endorsement added. If there is coverage check to see if there's a limit on the value of the vehicle you'd be covered for. Best to read the policy with a fine tooth comb so there is no surprises.


Well to clarify, it sounds like this umbrella policy is for liability protection. e.g. horrible car accident, other person is injured, they sue me. That's what I am worried about since judgements can be into a few million $ (death, paralysis, etc).

I'm not worried about the damage to the rental vehicle. That's already covered by my credit card, but in any case is capped at the value of the vehicle which is maybe 20K or something. I'm sure many of these smaller rental cars aren't worth more than 15K even if destroyed.

Many credit cards provide insurance for rental car damage. It's the liability protection that's hard to get, e.g. 2M or 3M coverage.


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## Synergy

james4beach said:


> Well to clarify, it sounds like this umbrella policy is for liability protection. e.g. horrible car accident, other person is injured, they sue me. That's what I am worried about since judgements can be into a few million $ (death, paralysis, etc).
> 
> I'm not worried about the damage to the rental vehicle. That's already covered by my credit card, but in any case is capped at the value of the vehicle which is maybe 20K or something. I'm sure many of these smaller rental cars aren't worth more than 15K even if destroyed.
> 
> Many credit cards provide insurance for rental car damage. It's the liability protection that's hard to get, e.g. 2M or 3M coverage.


That's good. Liability coverage is broken down into bodily injury and property damage. Property damage may arise is you run into a commercial building, fly through a neighbours house, etc. The umbrella policy should cover this if it's already covering bodily injury. Coverage for damage to a rental car is often called liability for damage to non-owned vehicles. I would check the limit on your card to see what value of vehicle you're ok renting. Most have a limit.


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## HappilyRetired

Also consider a dash cam, they're inexpensive but in the event of a collision they could end up being your best friend. Really, they are a form of insurance.


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## jargey3000

On a side-note, why do all the insurance companies seem to think their commercials have to be funny?
You know the ones I mean - Geico, Progressive, Liberty etc.
Yeah, everything's funny ......UNTIL you get your policy renewal & see your premium increases!!


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## coptzr

Anyone here "self-insured"?


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## Beaver101

jargey3000 said:


> On a side-note, why do all the insurance companies seem to think their commercials have to be funny?
> You know the ones I mean - Geico, Progressive, Liberty etc.
> Yeah, everything's funny ......UNTIL you get your policy renewal & see your premium increases!!


 ... that's the whole idea- get to laugh before you cry. The truth is their marketing department has a warped sense of humour.


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## Beaver101

coptzr said:


> Anyone here "self-insured"?


 ... Musk, Bezos, Buffett and their likes - here.


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## Mukhang pera

james4beach said:


> I just learned that my home insurer offers "Personal Umbrella" liability insurance, which can add on 1M, 2M etc on top of my existing home insurance.
> 
> But the surprising part was that, according to the insurance rep, this "umbrella" insurance also follows me anywhere in the world, including in rental cars.
> 
> I don't own a car, so I don't have any car insurance. For many years, I've been wondering how to get my own liability policy that will protect me in case of a car accident and lawsuit. Now it sounds like the umbrella insurance (*under home insurance*) can do this.
> 
> @Mukhang pera does that sound right to you? Could it be that simple?


It sounds right at first blush. I would both discuss with my agent and, as well, take Synergy's advice and read the policy carefully.


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## MrMatt

coptzr said:


> Anyone here "self-insured"?


For car insurance I don't think it's reasonable for most people.



james4beach said:


> I just learned that my home insurer offers "Personal Umbrella" liability insurance, which can add on 1M, 2M etc on top of my existing home insurance.
> 
> But the surprising part was that, according to the insurance rep, this "umbrella" insurance also follows me anywhere in the world, including in rental cars.


I've got that on my policy, really it makes sense, it's a lot less work for everyone.

Remember the trick with insurance is that there are very few claims, a lot of the cost is administrative, keeping it simple can lower administration costs.

The more I learn, the more I see the value of simpler systems, even with the lost of detail.


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## james4beach

Mukhang pera said:


> It sounds right at first blush. I would both discuss with my agent and, as well, take Synergy's advice and read the policy carefully.


Thanks! I'm going to have to phone the insurance company and ask them to walk me through some of the wording. The text for umbrella coverage seems pretty complicated.


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## AltaRed

HappilyRetired said:


> Also consider a dash cam, they're inexpensive but in the event of a collision they could end up being your best friend. Really, they are a form of insurance.


Dash cams need to be built right into the vehicle's infrastructure to be most useful. In modern vehicles, all the cameras are already present and it would only be some software on the infoscreen and an SD card slot that would be needed to make it operational. They should be a standard item in every new vehicle sold, costing about $10-20 tops for a manufacturer to put in every vehicle. 

I would have one but hate the thought of dangling wires AND having to hide it out of sight every time I exited the vehicle in a public place.


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## MrMatt

AltaRed said:


> Dash cams need to be built right into the vehicle's infrastructure to be most useful. In modern vehicles, all the cameras are already present and it would only be some software on the infoscreen and an SD card slot that would be needed to make it operational. They should be a standard item in every new vehicle sold, costing about $10-20 tops for a manufacturer to put in every vehicle.
> 
> I would have one but hate the thought of dangling wires AND having to hide it out of sight every time I exited the vehicle in a public place.


Would drive me crazy, they just cut our speed limits to 40km/hr which is REALLY SLOW.

The problem is the people running stopsigns and flying through at 80+, sitting on their cell phones (in a residential neighbourhood.

Now that backup cameras have been mandated most of the supply chain is already setup. I think $10 would be the higher end of the cost.


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## gardner

AltaRed said:


> Dash cams need to be built right into the vehicle's infrastructure to be most useful. In modern vehicles, all the cameras are already present and it would only be some software on the infoscreen and an SD card slot that would be needed to make it operational.


I would be happy just with a USB plug in the mini console above the rear view mirror. Running wires all around and using a lighter socket is something out of the 80s. Both my vehicles have powered doodads in the rear view mirror and could easily have a usb plug there.



> having to hide it out of sight every time I exited the vehicle


Why take it down? I leave mine up all the time in both vehicles. They're tucked in at the top of the glass behind the rear view mirror.


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## AltaRed

I agree an option could be USB in the rear view mirror assembly where rain sensing wipers and all that other stuff is. There is no room to mount a dash cam unit anywhere on the glass except beside the rear view mirror.

There is no excuse why automakers couldn't put that $X option into vehicles already. I already have an SD Card slot in the console for upgrading Navigation maps, all the cameras and the infoscreen so there is nothing physically more in hardware that needs to be provided.

Too many friends and family have had side windows broken to steal portable GPS and dash cam units. I never leave anything of value visible in a vehicle.


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