Ontario Liability Car Insurance Coverage
Learn how third-party liability car insurance works in Ontario, what it covers and the liability limits available.
Liability Coverage at a Glance
| Mandatory Coverage | Minimum Coverage | How It Works | Higher Limits Available |
|---|---|---|---|
| Yes | $200,000 | Covers certain claims when someone is killed or injured, or their property is damaged, when you or another insured person is at fault | Higher liability limits such as $1 million and $2 million are available |
What is Third-Party Auto Liability Coverage?
| What It Means | How It Works |
|---|---|
| Third-Party Liability | Covers certain amounts you or another insured person may be legally responsible to pay for injury, death or property damage arising from the ownership, use or operation of an automobile |
| Who Is the Third Party? | Another person who is injured or killed, or whose property is damaged |
| Covered Liability Claims | Coverage can respond when you or another insured person is legally responsible for a covered claim |
| Claim & Legal Defence | Your insurer can investigate, negotiate, settle and defend covered liability claims |
| Policy Limit | Coverage is subject to the third-party liability limit shown on your policy and the terms and conditions of the OAP 1 |
How Liability Car Insurance Works in Ontario
| 1. You Carry Liability Coverage | 2. An At-Fault Accident Occurs | 3. Your Insurer Responds |
|---|---|---|
| Ontario drivers are required to carry third-party liability coverage when driving. | You or another insured person is legally responsible for an accident that causes injury, death or property damage to a third party. | Your insurer investigates the covered claim, handles the legal defence where required and pays covered amounts you are legally liable for, up to the applicable policy limit. |
What Isn't Covered by Ontario Auto Liability Insurance?
| Damage to Your Own Vehicle | Your Own Injuries | Theft or Other Physical Damage |
|---|---|---|
| Third-party liability does not pay for collision damage to your own vehicle | Benefits for your own injuries are generally addressed under Accident Benefits | Theft, vandalism and certain other losses to your vehicle are generally addressed by physical damage coverage such as Comprehensive |
When a Liability Claim May Not Be Covered
| Unlisted or Undisclosed Driver | Criminal or Illegal Use |
|---|---|
| Coverage may be affected when a household or regular driver was not disclosed to the insurer. | Coverage may be affected if the vehicle is used in connection with certain criminal or illegal activity. |
| Misrepresentation or Non-Disclosure | Excluded or Prohibited Use |
| Providing incorrect information or failing to disclose important information may affect coverage. | Coverage may be affected if the vehicle is being used in a way excluded or prohibited by the policy. |
Coverage examples are provided for general information only. Coverage depends on the circumstances of the loss and is subject to the terms, conditions, limits and exclusions of the policy.
Ontario Auto Liability Claim Example
You are legally responsible for an accident in which another person is seriously injured. A lawsuit is brought against you, and your insurer provides a legal defence.
| Claim Example | Amount |
|---|---|
| Your Liability Limit | $2,000,000 |
| Court-Awarded Legal Costs | $25,000 |
| Amount Awarded for the Claim | $2,300,000 |
| Paid Toward the Judgment by Your Insurer | $2,000,000 |
| Amount Above Your Liability Limit | $300,000 |
Your insurer would pay the $2 million covered portion of the judgment, as well as the applicable legal costs it is required to pay under the policy. You would be responsible for the $300,000 that exceeds your liability limit, along with any applicable interest on that excess amount.
This example is for illustration only. Actual coverage depends on the circumstances of the claim and the terms, conditions, limits and exclusions of the policy
How Much Liability Insurance Should I Carry?
Ontario's $200,000 legal minimum provides limited protection against a serious liability claim.
Humberview recommends carrying at least $2 million in liability coverage and considering higher limits based on your assets, driving exposure and overall financial risk.
| What to Think About | Why It Matters |
|---|---|
| Your Home, Savings & Assets | Higher liability limits can provide more protection if a serious claim puts your personal assets at risk |
| Where & How Much You Drive | Consider how often you drive, the distances you travel and whether you regularly drive outside Ontario or into the United States |
| Other Drivers in Your Household | Consider everyone who may regularly drive your insured vehicles, not just yourself |
| $1M vs. $2M vs. Higher Limits | Higher limits provide more protection if a covered liability claim becomes severe |
| Cost of More Coverage | Compare the cost of increasing your liability limit before deciding |
Considering $5 Million or More?
Higher liability limits may be available directly on your auto policy or, more typically, through a personal umbrella liability policy, which can sometimes be added in connection with your home insurance policy. An umbrella can provide additional liability protection above the underlying limits of your auto and other eligible personal insurance policies.
Related Ontario Auto Insurance Coverages
Uninsured Automobile
Accident Benefits
OPCF 44R Family Protection
Why Humberview for Auto Liability Coverage?
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One Dedicated Broker
Work with a dedicated broker who knows your policy and insurance needs
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Compare Liability Options
We can compare available liability limits and coverage options from multiple insurers
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Advice Based on Your Needs
Get clear advice to help you understand your options and choose coverage that fits your needs.
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Independent Since 1982
Humberview has been providing insurance advice to Ontario clients since 1982
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