Ontario's auto system and the OAP 1

4.1 Compulsory insurance

Under Ontario's Compulsory Automobile Insurance Act, every vehicle driven on Ontario roads must be insured. The minimum third-party liability limit is $200,000, though most brokers recommend $1 million or $2 million because serious claims can be far higher.

• Driving, or letting someone drive, an uninsured vehicle can bring a fine of $5,000 to $25,000 on a first conviction, with higher fines for repeat offences. The licence can be suspended and the vehicle impounded. This applies even if there's no accident.
• Drivers must carry proof of insurance (the "pink slip"). Ontario has allowed electronic proof of insurance, such as on a phone, since 2019 where the insurer offers it.
• Knowingly giving false information to get auto insurance is an offence under the Insurance Act, with fines up to $250,000 for a first conviction.

Snowmobiles, ATVs and other off-road vehicles must be insured when they're used off the owner's property. OAP 1 includes motorized snow vehicles in its definition of automobile.

4.2 How the Ontario system fits together

• Auto insurance is sold by private insurers. FSRA must approve their rates and underwriting rules before use.
• Take All Comers means insurers must offer coverage to anyone who meets their approved rules.
• Drivers who can't get coverage in the regular market can get it from the Facility Association.
• If no insurance is available at all, the Motor Vehicle Accident Claims Fund is the payer of last resort. It pays lawsuit judgments up to $200,000 per accident, and the uninsured driver must repay the Fund or lose their licence.
• Ontario uses a no-fault system. Since the Ontario Motorist Protection Plan (1990), injured people claim accident benefits from their own insurer whatever the fault, and the right to sue for pain and suffering is limited by a threshold. "No-fault" doesn't mean nobody is at fault: fault still affects premiums and how vehicle damage is paid.

Other provinces are different. British Columbia, Saskatchewan and Manitoba have government insurers for basic coverage, and Quebec has a public plan for bodily injury. A client moving provinces needs new coverage that meets the new province's rules.

4.3 The structure of OAP 1

The Ontario Automobile Policy (OAP 1) is the standard owner's policy, approved by FSRA. The current edition took effect on July 1, 2026. The contract is made up of the application, the Certificate of Automobile Insurance, the policy wording and any endorsements (OPCFs).

4.4 Which automobiles are covered

• Described automobile: the vehicle listed on the Certificate.
• Newly acquired automobile: a replacement car, or an additional car if the insurer insures all the insured's cars, is covered if the insurer is told within 14 days of delivery.
• Temporary substitute automobile: a car used while the described car is out of service for repair, servicing, theft, sale or destruction. It can't be owned by the insured or by anyone living with them.
• Other automobiles: coverage extends to the named insured (and spouse) driving other cars, as long as the car isn't owned or regularly used by them. Renting a car for 30 days or less is not regular use. Both cars generally must be 4,500 kg gross vehicle weight or less, but a heavier rental truck is covered when used for personal purposes, such as moving, for no more than 7 days.
• Trailers: when towed by the car, the trailer is treated as part of it for liability, accident benefits and uninsured automobile coverage. Damage to the trailer itself needs its own coverage.

Policy territory: Canada, the United States, and a vessel travelling between ports of those countries. Mexico is not included; drivers need local Mexican insurance.

4.5 The insured's duties and general conditions

• Report any accident involving injury or damage to the insurer or broker within 7 days, whoever was at fault.
• Cooperate with the insurer and pass along any legal documents promptly.
• Tell the insurer about material changes in the risk, such as a new driver in the household, a change in use (commuting, delivery or ridesharing) or a change of address.
• Don't let anyone drive who isn't authorized by law (for example, a suspended driver or a G1 driver without a qualified accompanying driver). If this happens, the insured's own car isn't covered, but third parties are still protected to the minimum limits, and the insurer can seek repayment.
• Don't carry paying passengers. OAP 1 makes exceptions for car pools and reciprocal rides, sharing the cost of an occasional trip, carrying a domestic worker, school activities, carrying clients or customers, and reimbursed volunteer drivers. Ridesharing for fares needs proper coverage.

Other material changes to report right away: an adult child moving back home who will drive the car regularly, or a client moving to another province. An Ontario policy is for Ontario residents. Once a client becomes a resident of, say, Alberta and registers the car there, he needs a policy that meets Alberta's rules from an insurer licensed there. Arrange it so there's no gap in coverage.

4.6 Section 3: Liability

Liability coverage protects the insured if they're legally responsible for injuring or killing someone, or damaging their property, while using the car. It covers the named insured and anyone driving the car with consent.

• In addition to the limit, the insurer pays defence costs, costs awarded against the insured, and post-judgment interest on the part of the judgment within the limit.
• It doesn't cover damage to the insured's own property, or to property they're carrying. Vehicle damage between Ontario drivers is mostly handled by DCPD instead (Chapter 5).
• When driving outside Ontario, the policy pays at least the minimum limit required in that place.
• If the insured has several cars on one policy with different limits and causes an accident in a car they don't own, the insurer pays up to the highest limit on any one described car, not the total.
• People in the business of selling, repairing, servicing, storing or parking cars are excluded while doing that business. A mechanic road-testing the car falls under the garage's own policy (OAP 4).

4.7 Cancelling an auto policy

The insured can cancel at any time. The refund is short rate.

The insurer can cancel during the first 60 days for any reason in its FSRA-filed rules. After 60 days, it can cancel only for:

• non-payment of premium;
• false particulars of the car, to the insurer's prejudice;
• knowing misrepresentation or failure to disclose; or
• a material change in the risk.

Registered mail notice periods start on the second day after mailing. If an insured has had two non-payment notices in one term, the insurer can use the shorter "other reason" periods and refuse a late payment. When the insurer cancels, the refund is pro rata.