Protecting Car Owners From Liability or Policy Exclusion

Protecting Car Owners From Liability or Policy Exclusion

If you have car insurance, you may assume that it covers everything related to driving and owning a vehicle. While an auto insurance policy in Alberta protects you from a wide array of accidents, costs and situations, there are some situations you may overlook. To help to protect you from an incident where you are not covered by your auto insurance policy or you are found to be unexpectedly liable, we outline important auto insurance facts below for you to be aware of.

1.Accepting Money For Ride-Sharing

With gas prices in constant flux, it is no surprise that car sharing services are a growing industry. Uber, the best known of ride-sharing services, is cheaper, quick and more flexible than a taxi cab, making it enticing for customers and an easy way for drivers to make cash on the side. Your standard car insurance policy does not cover commercial use of your vehicle, however, and your insurance could be invalidated if you are carrying passengers for payment. This means that to be a commercial driver, you must have a commercial insurance from your own insurance company.

Consider the case of a Toronto Uber driver who was told by Uber that he didn’t need separate insurance, but then he was denied coverage following a major accident while driving a paying client. Now, the driver is suing Uber for at least $1 million in damages and lost income while dealing with physical injuries, loss of his car and denial of the claim from his personal car insurance policy. A driver could also get sued from an injured paying passenger, even if the situation involves a friend or coworker who gives you gas money for a ride to work instead of through a ride-sharing company.

2. Lending Your Car

When you lend your car to another person (including letting another person drive while you are the passenger) you might erroneously assume that the driver is the one liable if an accident occurs. This is not quite the truth. Known as “vicarious liability”, consenting to lending your vehicle also means consenting to lending your insurance. Even if the driver has his or her own auto insurance, the burden still falls on the car owner who agreed to lend or rent the vehicle. Inevitably, if an accident occurs, you may be liable for the accident and could face the complications of personal injury claim of any of the parties involved in the accident collision.

3. Rental Car Insurance

At the rental car counter is the last place to be making a decision about whether to buy insurance; the research should already be done. Your existing auto insurance might provide liability protection but might not cover you for the damage to the rental vehicle if you don’t have this coverage outlined in your policy. If you pay by credit card, the insurance may not cover you in some situations (e.g., for most vehicles worth over $65,000, for personal liability, and for driving outside of Canada and the U.S.). If you buy insurance from the rental car company, it may not protect you if get a ticket in a collision. A rental car policy may not cover you for third-party expenses either. It’s important to familiarize yourself with the fine print that relates to your situation. An advance call to your insurance company to clarify and obtain protection could help to save you from major financial consequences.

4. Driving Away From Home

Car insurance has the benefit of covering you when you travel to other provinces and into the U.S. However, when driving your own car, coverage stops south of the U.S. There are easy ways to buy insurance at the Mexico border, but like rental cars, you should already know the purchase you are making in advance.

Also remember that rules of the road and parking violations vary in other countries, provinces and states. Breaking rules in another province is a violation and is recorded on your driving history. Some states in the U.S. have agreements with Canada to transfer this information but some do not. Be careful driving away from home and always check to find out the differences between your destination and home driving rules.

5. Transporting Cargo

Whether it is bringing a truck load to the dump, helping a friend move or strapping skis to your roof, there are regulations about how cargo can be moved and be secured. If cargo dislodges and causes damage, you may be worried about whether your insurance will cover you.

transporting cargo, with the number of tie downs determined by length of the load and capacity of at least equal to half the weight of the load. In Alberta, one tie down is needed for cargo 1.52 metres or shorter and weighing 500 kilograms or less. At least two tie downs are needed if the cargo is longer than 1.52 metres but less than 3.04 metres or weighs more than 500 kilograms. A minimum of three tie downs are needed for cargo longer than 3.04 metres.

Contact Us

At HDF Insurance in Edmonton, we are available to help you gain knowledge and avoid unexpected risks. Our insurance brokers provide exceptional service to ensure that we have satisfied customers. Contact us for a free auto insurance quote in Edmonton at 587-410-3424.