Optional Auto Insurance Coverage to Consider

If you’re like most Canadian drivers, your car insurance is likely a combination of what’s legally required and what your lender (if you finance or lease your vehicle) demands. But what about optional forms of car insurance? These add-ons might not be mandatory, but they can offer significant protection when the unexpected happens. At BIG, we believe that the more informed you are, the better your coverage choices will be.
Please note: This blog provides a general overview of some of the optional auto insurance coverages you could add to your policy. It is not all-encompassing and should not be taken as specific advice. Be sure to discuss your unique circumstances with a licenced insurance broker to receive guidance tailored to your situation.

Why Consider Optional Car Insurance?

Mandatory auto insurance generally includes:

• Third-party liability
• Accident benefits
• Direct compensation for property damage (DCPD)
• Uninsured automobile coverage

While this baseline is crucial, it doesn’t always provide comprehensive protection. That’s where optional auto coverages come in—they help fill in the gaps, especially when you're dealing with accidents, theft, vandalism, or liability claims.
Here are some of the most popular optional coverages Canadian drivers should consider:

1. Comprehensive Coverage

Comprehensive auto insurance protects you from non-collision-related incidents such as:

• Theft or attempted theft
• Vandalism
• Fire
• Falling objects (like tree branches or ice)
• Natural disasters (hail, floods, windstorms)
• Collisions with animals

If a tree falls on your parked car or someone smashes your windows in a break-in, your basic insurance likely won’t help. Comprehensive coverage gives you peace of mind, especially in urban areas or regions with unpredictable weather.

2. Accident Forgiveness

No one plans to get into an accident, but even the most careful drivers can have a lapse in judgment or find themselves in a tricky situation on the road. That’s where accident forgiveness can really come in handy. This optional coverage ensures that your first at-fault accident won’t affect your premium. In other words, your insurance rate stays the same, even after a collision that would normally trigger a price increase. It's a great feature for maintaining your good driver status and keeping your rates predictable. 
Why it’s worth it:

• Avoid hefty premium increases
• Maintain your clean driving discoun
• Great for extra protection, especially for new drivers or commuters

Note: Not all insurers offer this feature automatically. It's typically available as an endorsement and might require a clean driving history to qualify.

3. Increased Liability Limits

By default, auto policies in Ontario (and most provinces) offer $200,000 to $1 million in third-party liability coverage. But with rising legal and medical costs, that may not be enough.  If you’re found at fault, basic liability coverage might not be enough to protect you financially. 
Increasing your liability limits to $2 million or more can help protect your finances if:

• You’re sued after a major accident
• The accident involves multiple injured parties
• Property damage exceeds your current limit

The good news? This kind of upgrade is surprisingly affordable and could be the difference between manageable expenses and overwhelming out-of-pocket costs. If you frequently drive with passengers or travel long distances, it’s well worth considering.

5. Loss of Use Coverage (Rental Car Coverage)

If your vehicle is in the shop after an insured loss, Loss of Use coverage helps pay for a rental car, taxi, or public transit. Daily commuters and those who are in areas with limited public transit should strongly consider loss of use auto coverage. This can be a game changer when it comes to avoiding disruptions to your routine after an accident or theft.

6. Depreciation Waiver (Limited Waiver of Depreciation)

If you’ve just bought a new car, consider adding a depreciation waiver to your policy. If your car is written off within a certain time frame (typically 24–48 months), your insurer will reimburse the full purchase price—not the depreciated value.
Depreciation Waiver is a great choice for new vehicle owners and can help recoup the full investment if your car is stolen or totaled. Limited waiver of depreciation is essential if you’ve financed your vehicle and still owe a significant balance.

What Optional Coverage Should You Choose?

Choosing the right optional car insurance coverage depends on several personal factors. Start by considering the age and value of your vehicle. If you drive a newer or high-value car, comprehensive and collision coverage may be worth the investment to protect against damage or theft. Your driving habits also matter—if you commute long distances or drive frequently, you may face a higher risk of accidents, making optional coverages more valuable. Where you live plays a big role as well. Urban areas tend to have higher theft and accident rates, while rural regions may present risks like collisions with wildlife.

How Much Do Optional Car Insurance Coverages Cost?

The cost of adding optional coverages to your car insurance policy can vary quite a bit. Factors such as the type of coverage you choose—like comprehensive, collision, or accident forgiveness—will influence the final price. Your vehicle’s make and model also plays a role; high-end or specialty cars often impact the amount you will pay for coverage. Regardless, our BIG Insurance brokers are always happy to walk you through the details and help you find a policy that balances protection and affordability.
Pro Tip