Expert says new Ontario insurance rules could save drivers up to 20% on payments. But is it worth it?

Ontario drivers pay some of the highest insurance premiums in Canada and starting in the New Year, there may be a way to save some money, but some experts are cautioning against it.

Ontario drivers pay some of the highest insurance premiums in Canada and starting in the New Year, there may be a way to save some money, but some experts are warning against it.

As of January, drivers will be allowed to “opt-out" of direct compensation property damage (DCPD), which protects car owners from costs related to vehicle damage from collisions if they are not at fault. If you don’t have DCPD coverage and you get into a collision, you must repair your own vehicle, you can’t sue if a driver hits you or have items replaced in your vehicle damaged in a crash.

“In some cases, you could save five or ten or even twenty per cent," Daniel Ivans, insurance expert with Ratesdotca, told CTV News Toronto. "It really depends on the vehicle you are driving and the company you are insured with."

According to Anne Marie Thomas with the Insurance Bureau of Canada, drivers should weigh their decision carefully before agreeing to decline DCPD coverage.

“This coverage provides you with a lot more protection than just damage to your vehicle,” Thomas said, adding “it's about weighing your position and your level of risk and your comfort with that."

You may consider dropping DCPD coverage if you have an older car that’s not worth very much, but even then, Thomas said it might not be worth the risk.

In addition for being on the hook for repairs, drivers with DCPD coverage in a collision will also have to pay costs normally be covered by insurance such as for the tow truck, vehicle storage or rental cars.