Toronto Injury Lawyer Blog
The penalties for driving without car insurance need to be more harsh. When you factor in that the cost of car insurance can range from $3,000-$5,500/year depending on the make of your vehicle and driving record; compared to the $5,000 first time penalty for driving without car insurance, the risk/reward scenario for deliberate offenders who are without any tangible assets is borderline tempting…Especially for those who are struggling financially.
But we aren’t advocating that anyone drive without car insurance.
Section 2(1) of the Compulsory Automobile Insurance Act states:
Compulsory automobile insurance
2 (1) Subject to the regulations, no owner or lessee of a motor vehicle shall,
(a) operate the motor vehicle; or
(b) cause or permit the motor vehicle to be operated,
on a highway unless the motor vehicle is insured under a contract of automobile insurance.
What this means is that you need car insurance in order to operate a motor vehicle. What is the penalty if you are caught driving without proper car insurance? Let’s take a look at what the Compulsory Automobile Insurance Act says:
Offence
(3) Every owner or lessee of a motor vehicle who,
(a) contravenes subsection (1) of this section or subsection 13 (11); or
(b) surrenders an insurance card for inspection to a police officer, when requested to do so, purporting to show that the motor vehicle is insured under a contract of automobile insurance when the motor vehicle is not so insured,
is guilty of an offence and is liable on a first conviction to a fine of not less than $5,000 and not more than $25,000 and on a subsequent conviction to a fine of not less than $10,000 and not more than $50,000 and, in addition, his or her driver’s licence may be suspended for a period of not more than one year.
This means that if you don’t have car insurance while operating a motor vehicle, you will get ticketed and fined a minimum of $5,000, and maximum of up to $50,000 for repeat offenders. In addition, your driver’s license can be suspended for up to a year. But, it does not mean that you will go away to jail for many years and that they will throw away the key. You would think that minimum fine of $5,000 would be enough of a disincentive to ensure that drivers have proper can insurance. But it’s not. People still drive without car insurance either because they are doing it on purpose, or there’s a banking error such that premiums never got paid and the insurer stopped covering them on account of unpaid premiums; or there was an honest mistake (or a not so honest mistake).
With an honest mistake, I’ve seen jurisdictions which allow the driver to attend at the police station or reporting centre after the accident, or after being pulled over and given the opportunity to present their pink slip proof of auto insurance card. That way they can show the officers that it was an honest mistake in not having their pink slip on them or in their vehicle when they were driving.
Either way, most people know that driving without car insurance is illegal, but it does not result in jail time. Rather, it results in heavy fines and potentially having your driver’s license suspended for up to a year.
For many people, the penalties aren’t a big enough deterrent to purchasing insurance.
Take into consideration that the cost of insuring a vehicle can range depending on where you live, and what vehicle you drive, along with your driving record and past infractions. For a higher risk driver, living in a high risk area, with a high risk vehicle, those insurance premiums can soar in excess of $5,000/year+++. Let’s assume that the car insurance is between $4,000-$6,000/year; it’s very tempting for an individual who is short on money to drive without insurance given that the monetary penalty for having no car insurance is almost identical to purchasing the insurance itself. The upside for the delinquent driver is a savings of close of $5,000/year on auto premiums. The downside is an economic wash ($5,000 in premiums saved is negated by a $5,000 penalty infraction for driving without car insurance).
The offense of driving without car insurance does NOT trigger any demerit points. This has never been a good idea as it seems like those who drive without car insurance are getting away with it without great penalty. Again, this is another reason why somebody who is on the fence about purchasing car insurance may opt not to do so.
The driver’s license MAY be suspended for up to a year, but rarely does this happen to first time offenders.
Securing car insurance after you’ve been penalized for driving without car insurance will likely increase your rates moving forward.
As you can see, the penalties for driving without car insurance are mainly monetary. If you have the means to pay the penalty, or for higher premiums, the deterrents aren’t there for the offending party. The penalties aren’t stiff enough to act as a significant deterrent.
Here are a few thoughts:
- The first time penalty for driving without car insurance should not be equal to, or slightly greater than the cost of the car insurance itself. These penalties might sound like a lot of money, but the cost of car insurance is also a lot of money. Increase the fines for both first time offences and subsequent offences
- Demerit Points: Introduce them. The points attach to the driver’s license and a person’s privilege to drive.
- Driver’s license suspensions: create a progressive scale:
90 days first offence
180 days second offence
Year long suspension thereafter
These are real deterrents to driving without car insurance. Funny observation: Car insurance premiums continue to rise. Yet, the penalties to offending the laws which are supposed to be deterrents do not. It appears that the Compulsory Automobile Insurance Act has not been changed since December 2020…If this is correct, that means that the monetary penalties for driving without car insurance have not changed either to reflect the cost of inflation or the raising costs of automobile insurance premiums. Making those changes would be a very easy thing to do, especially with the Conservatives are rolling with a majority government.
Knowing this, it should no longer surprise you that many people are out there, illegally, driving without valid car insurance. Sometimes they even present fake pink slips to the police! How can you protect yourself if you’re a law abiding motorist (which you ought to be). The easiest way is to have your own car insurance. Your own car insurer will step into the shoes of the at fault driver to ensure that you are protected one way, or another. But more on that in another edition of the Toronto Injury Lawyer Blog.
