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Sharing a Car: How Does Insurance Work? 

Are you considering sharing a car with a family member, friend, or colleague? In Canada, you can lend someone your car from time to time, and they will be covered under your policy, but if you plan to share it on a regular basis, legally you need to add them to your insurance policy. This isn’t always a bad thing. Co-ownership can greatly help to reduce ownership costs, but it can also impact your rates on your insurance. Find out how joint ownership works and what you need to consider before deciding whether it’s the right choice for you!

How Joint Car Ownership Work

If you’re not in a financial situation to afford car expenses on your own, joint car ownership can seem like a great option. In Ontario, joint car ownership can be granted to any two parties, whether they are friends, relatives or colleagues. The way it works is that both names will be put on the driver’s permit and any paperwork, such as the transfer of ownership, must be signed by all parties. The process is really as simple as that. To prove joint ownership occurs when you or your secondary party are driving, the permit should be kept in the car to be shown to authorities if the need arises. 

How Does It Affect Car Insurance Rates

The rate you will receive will depend on both your driving records and risk factors. For instance, if you’ve had several speeding tickets in the past, this will likely affect the rate you receive, even if the other party has never had a ticket before. Age and experience also matter and will be taken into consideration. If your co-owner is a new driver or under the age of 21, your premium could be much higher than if you’re sharing with an experienced, older driver. 

Is Co-Ownership Right For You?

For many people, sharing a car is a good move. If you both have good driving records and low-risk factors, it can save you a lot of money. However, not all insurance companies offer attractive rates when it comes to joint ownership. That’s why we recommend talking to one of our MLS insurance brokers today. We can find which insurance company will offer you the best rate and how much your rates will be together and separately so you can make a better-informed decision.

At MLS Insurance, we save you time and money by presenting all the best options and rates. We look at your exact situation, risk-level, and insurance needs and then find the insurance company and policy that will match your needs best. Contact us today to learn more about our services and to set up a consultation.

  • We came back from London last Thursday night. Our daughter Anna had settled in London now and very anxious about her new school life. I want to thank you for introducing Fred to us for Anna's insurance. He was super helpful (day and night) that made me feel so easy to get things going as we travel.