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When the at fault driver doesn’t have car insurance in Ontario

It’s a legal requirement to drive a motor vehicle with car insurance.

Section 2(1) of the Compulsory Automobile Insurance Act states:

Compulsory automobile insurance

(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

In plain language English, this means that if you are driving a motor vehicle without insurance, you are breaking the law.

The consequences for breaching the Compulsory Automobile Insurance Act can be significant. It’s not a criminal offense, but the fines and consequences for driving without car insurance can add up quickly.

Section 2(3) of the Compulsory Automobile Insurance Act sets out the penalties for driving without insurance. Those penalties are set out below. If you don’t want to read the “leagalese”, I’ll quickly summarize those penalties for you. A Justice of the Peace can fine you (not more than $50,000 after multiple offenses), can take away your driver’s license, can impound your car, and can charge you for the costs of impounding your car.


(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.  R.S.O. 1990, c. C.25, s. 2 (3); 1996, c. 21, s. 50 (4); 2002, c. 22, s. 33.

Justice to secure possession of driver’s licence

(4) Where a justice makes a conviction under subsection (3) and the driver’s licence of the person convicted is suspended by the justice, the justice shall take the driver’s licence and forward it to the Registrar.  R.S.O. 1990, c. C.25, s. 2 (4).

Police officer may secure possession

(5) Where a driver’s licence is suspended under this section and the person to whom the suspension applies refuses or fails to surrender his or her licence to the justice forthwith, any police officer may, and upon the direction of the Registrar shall, take possession of the licence and forward it to the Registrar.  R.S.O. 1990, c. C.25, s. 2 (5).


(6) Every person who fails or refuses to surrender his or her driver’s licence when required by a police officer under subsection (5) is guilty of an offence and on conviction is liable to a fine of not more than $200.  R.S.O. 1990, c. C.25, s. 2 (6); 1996, c. 21, s. 50 (5).

Impounding motor vehicle

(7) In the event of a conviction under subsection (3), the justice may order that the motor vehicle,

(a) that was operated in contravention of subsection (1);

(b) for which a false statement in respect of insurance was made in contravention of subsection 13 (11); orlinkedin-2-300x300

(c) for which an insurance card was produced in contravention of clause (3) (b),

shall be seized, impounded and taken into the custody of the law for a period of not more than three months.  R.S.O. 1990, c. C.25, s. 2 (7); 2002, c. 22, s. 33.

Cost of storage

(8) All costs and charges for the care and storage of the motor vehicle are a lien upon the motor vehicle that may be enforced in the manner provided by the Repair and Storage Liens Act. 

But, what happens to the innocent driver who was hit by a law breaker who was driving without car insurance?

Good question!

In the normal course, the at fault party’s car insurer would step into the shoes of the at fault driver to defend the personal injury lawsuit. The insurer would pay for their lawyer, and payout on any judgment at trial or settlement reached outside of Court.

But when there’s no insurance available to the at fault driver, then the innocent driver should not have to suffer because of someone’s mistake or bad judgment in choosing to drive without insurance; or simply doing so unintentionally.

This is when you own insurance company kicks in.

You see, your own car insurance not only insures you in the event that you are at fault for a car accident. But, it will also cover you in the scenario where you are not at fault, but another driver who is at fault hits you but that driver did not have any form of car insurance. In that sort of case, your own insurer will jump into the shoes of the at fault uninsured driver to defend the claim.

This creates a situation whereby the Plaintiff has to sue his/her own auto insurer. Don’t expect any sort of preferential treatment from your own car insurance company in this scenario. Your own car insurer will treat you the exact same way that they treat everyone else. They will be just as tough on you as they are as tough on everyone else.

In the event that your own insurer settles the case outside of Court, or has to pay a Judgment on the car accident case; your own insurer can then pursue a claim against the at fault driver personally for what they have paid out on the case. This is called an insurer’s subrogated claim, or a subrogated interest. In most cases, there are no assets there to be had. But, if the at fault driver owns some property, the insurer will be more keen to pursue these sort of claims. If they are successful in securing a judgment, they can put a lien on the property in order to secure their interests. Where there is no real property for a lien, these cases can be more problematic in getting a secured interest on the judgment. The Judgment will only act as a piece of paper if there is no money, or no property to satisfy the Judgment. Nobody is going to jail for failure to pay out on a civil judgment in relation to a personal injury case.

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