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Insurance: What is student auto insurance in Canada?

Insurance: What is student auto insurance in Canada?
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Student auto insurance is for drivers who attend high school, CEGEP or university. To be considered a “student” by most insurers, you must be 25 or under.

Contrary to what the name suggests, it’s not a discount. It’s actually one of the highest premiums in the Canadian auto insurance market.

Why does student auto insurance cost more?

All insurance works on statistics: groups or events that are more likely to result in a claim pay a higher price. In the insurer’s eyes, a student is still learning to drive and doesn’t have enough experience to be considered a safe driver.

So you’re part of one of the highest-risk groups when it comes to driving, which significantly increases your premiums, regardless of your personal record.

Manitoba and Saskatchewan: the exception

Students who live in Manitoba or Saskatchewan don’t have to pay these higher premiums. In these two provinces, auto insurance is managed by a public system (Manitoba Public Insurance and SGI, respectively), where age isn’t factored into the calculation of an individual insurance price.

How can you lower your auto insurance premiums as a student?

Auto insurance prices for students vary based on several factors. Here are the most effective strategies to save on your auto insurance.

Get your full licence

If you haven’t already, get your full driver’s licence rather than a learner’s permit. Full-licence holders save an average of 10% on their premium compared to learner’s permit holders.

Become a secondary driver on your parents’ policy

If you can’t afford to pay for a policy in your own name, become a secondary driver on your parents’ or guardian’s policy. This option is generally less expensive and still allows you to start building a driving record.

Take advantage of the good grades discount

Many insurers offer a discount to students with a high GPA. It’s often the best discount available for a student: some providers offer up to 25% off when you show a report card.

Install a telematics system

As a new driver, installing a telematics system in your car can significantly reduce your premiums. The device tracks your driving (speed, braking, driving hours) and rewards safe driving. Some drivers find the monitoring restrictive, but if you already follow speed limits, the savings are often worth it.

Compare insurers before renewing

Shop around: compare providers and present the best quote you get to your current insurer before renewing. After comparing two or three insurers, you’ll usually find a better offer than your automatic renewal.

Student auto insurance – FAQ

Why is student auto insurance so expensive?

Insurers consider students to be inexperienced drivers, regardless of their personal record. This lack of driving experience is statistically associated with a higher risk of claims, which drives up the premium.

Up to what age am I considered a student by insurers?

Most insurers consider a driver to be a student up to age 25. Some insurers may have a different threshold: always check the exact criteria before applying.

Are Manitoba and Saskatchewan really cheaper for students?

Yes. These two provinces manage auto insurance through a public system that doesn’t take age into account when calculating an individual premium, unlike the private market in the rest of Canada.

Does the good grades discount work with all insurers?

No, this discount isn’t offered by all insurers. Check with your provider to see whether a good grades discount is available and what GPA is required to qualify.

Is it cheaper to stay on my parents’ policy?

Generally yes, if you become a secondary driver on their policy rather than taking out a policy in your own name. However, this option is still subject to their insurance terms and the insurer’s approval.

Does a telematics system really reduce the premium?

Yes, in most cases. The system records your actual driving habits (speed, braking, driving hours), and the insurer adjusts the premium based on driving that’s shown to be safe.

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