Key Takeaway

Filing a claim can increase your premium at renewal, but the impact depends on fault determination, your claims history, whether you have accident forgiveness, and your province’s rating rules. At-fault claims typically trigger a surcharge that lasts three to six years, while not-at-fault claims usually do not affect your rate. Use this checklist to understand what happens after you file a claim and how to minimize the financial impact at renewal.

Introduction

When you file an insurance claim in Canada, your insurer records the event and uses it to calculate your premium at the next renewal. The size of the increase (or whether there is one at all) depends on who was at fault, your past claims history, and the specific rating rules in your province or territory. Understanding these factors helps you make informed decisions about whether to file a claim or pay out of pocket, and what to expect when your policy renews.

According to the Insurance Bureau of Canada, insurers assess risk based on your likelihood of filing future claims (IBC, 2026). A history of at-fault claims signals higher risk, which translates to a higher premium. This checklist walks you through the key considerations so you know exactly how a claim moves your rate.

Checklist: How a Claim Affects Your Premium at Renewal

1. Determine Fault

  • Check the fault determination rules in your province. In Ontario, for example, the Fault Determination Rules are set by regulation and assign a percentage of fault to each driver based on the collision scenario, not on who caused the accident.
  • Understand the difference between at-fault and not-at-fault claims. An at-fault claim means you were responsible (fully or partially) for the loss. A not-at-fault claim means another party was responsible, or the loss was beyond your control (such as theft, vandalism, or a hit-and-run where the other driver is unidentified).
  • Know that partial fault counts as at-fault for rating purposes. Even if you are only 25 percent at fault, the claim may be treated as at-fault by your insurer when calculating your renewal premium.

2. Review Your Claims History

  • Count how many at-fault claims you have filed in the past six years. Most insurers look back three to six years when setting your rate.
  • Understand that multiple claims compound the surcharge. One at-fault claim may raise your premium by 20 to 40 percent; two or more can result in a much steeper increase or even non-renewal.
  • Check your driving record and insurance history. Some provinces (such as Ontario) allow you to request your auto insurance history from your current or past insurer, which shows the claims on file.

3. Check for Accident Forgiveness

  • Find out if your policy includes accident forgiveness. This optional coverage (sometimes earned after a claim-free period, sometimes purchased as an endorsement) protects your rate after your first at-fault claim.
  • Read the fine print. Accident forgiveness typically applies only to the first at-fault claim and may have limits (for example, it may not apply if the claim exceeds a certain dollar amount or if you have multiple claims in a short period).
  • Know that accident forgiveness is not available in all provinces or from all insurers. In British Columbia, for example, where auto insurance is provided by ICBC (a public insurer), the rating system differs from private markets.

4. Understand the Surcharge Timeline

  • Expect the surcharge to apply for three to six years. The at-fault claim remains on your record and affects your premium for this period, after which it typically falls off.
  • Know that the surcharge usually appears at your next renewal. Your insurer recalculates your rate when the policy renews (annually in most cases), and the claim is factored in at that time.
  • Ask your insurer or broker for a renewal estimate. They can project the impact before you commit to filing the claim.

5. Consider Claim-Free Discounts

  • Understand that an at-fault claim may reset your claim-free discount. Many insurers offer a discount for each consecutive year you do not file a claim; one at-fault claim can erase years of savings.
  • Check whether not-at-fault claims affect your discount. In most cases they do not, but policies vary.

6. Factor in Provincial and Territorial Differences

  • Know the rules in your province or territory. Auto insurance is regulated provincially, and rating rules differ:
    • Ontario: Private market, fault determination by regulation, surcharges for at-fault claims.
    • British Columbia: Public insurance via ICBC, claims affect your driver factor and discount level.
    • Alberta: Private market, similar to Ontario.
    • Quebec: Public bodily injury coverage via the SAAQ, private coverage for property damage (claims for property damage can affect your private premium).
    • Saskatchewan and Manitoba: Public insurance via SGI and MPI, respectively.
  • Consult your provincial regulator’s consumer resources. In Ontario, for example, the Financial Services Regulatory Authority of Ontario (FSRA) provides guidance on auto insurance (FSRA, 2026).

Read also: How to Dispute an Insurance Claim in Canada: Your Rights and Options

7. Weigh the Cost of the Claim vs. the Premium Increase

  • Estimate the total cost of the surcharge over the rating period. If your premium increases by C$500 per year and the surcharge lasts five years, the total cost is C$2,500.
  • Compare this to the claim payout minus your deductible. If the claim is for C$1,200 and your deductible is C$500, you receive C$700 from the insurer but may pay C$2,500 in higher premiums over five years.
  • For small claims, paying out of pocket may be the better financial decision.

8. Document Everything

  • Keep records of the collision or loss. Photos, police reports, witness statements, and repair estimates support your claim and help establish fault.
  • Save all correspondence with your insurer. This includes claim numbers, adjuster contact information, and any written decisions about fault or coverage.

Tips for Managing Premium Impact

  • Shop around at renewal. Even with a claim on your record, some insurers may offer a better rate than your current provider, especially if you have other positive factors (such as a long driving history or bundled home and auto policies).
  • Ask about claim forgiveness before you file. If you have earned this benefit, confirm it applies to the type of claim you are filing.
  • Consider raising your deductible. A higher deductible lowers your premium and may offset part of the surcharge, though it increases your out-of-pocket cost if you file another claim.
  • Work with a licensed insurance broker. Brokers represent multiple insurers and can help you find the best rate after a claim, as covered in foundational texts such as Principles of Finance.

Frequently Asked Questions

Does a not-at-fault claim increase my premium? No, a not-at-fault claim typically does not increase your premium in most Canadian provinces. However, some insurers may consider your overall claims frequency (including not-at-fault claims) when assessing risk, so it is important to confirm your insurer’s policy.

How long does an at-fault claim stay on my record? An at-fault claim usually stays on your insurance record for three to six years, depending on the insurer and the province. After this period, the claim typically no longer affects your premium.

Can I avoid a premium increase by not filing a claim? Yes. If the cost of the damage is less than your deductible or only slightly above it, and you can afford to pay for the repair yourself, not filing a claim will keep your record claim-free and preserve any claim-free discounts.

Conclusion

Filing a claim triggers a review of your risk profile at renewal, and an at-fault claim almost always results in a premium increase that lasts several years. By understanding fault determination, checking for accident forgiveness, and weighing the cost of the claim against the long-term surcharge, you can make the best decision for your financial situation. Always confirm the details with a licensed insurance broker or agent in your province, and review your policy’s fine print before filing.

Disclaimer: This article provides general information only and is not insurance, financial, or legal advice. Insurance products, coverage, exclusions, fault determination rules, and rating practices vary by province and territory and by insurer. Premium surcharges and claim-free discounts depend on your specific policy, claims history, and the regulations in your jurisdiction. Confirm all details with a licensed insurance broker or agent in your province or territory and consult your provincial insurance regulator for rules that apply to your situation. For personal advice, speak with a licensed insurance professional.