Car Insurance Renewal: Some Negotiation Tips

If you have a car, then you have car insurance: It is the law. In Canada, the regular for Auto insurance contracts is to last two years. After those two years, you can either renew it or change to another company. Now, changing seems OK, but if you have the chance to stay, why not?

Perfect Record? It doesn't matter

Don't feel frustrated when you get the increase notice. It is the industry default and will always be.

The premium always goes up because of inflation, risk increase, bank interest rates, parts pricing, models... there are way many reasons why the price of your monthly insurance costs go up. Even if you haven't made a single claim during the last two years, or got a single ticket, it will go up. That is the default system behavior, and that's what software systems calculate.

This should be your argument #1: Why do I have to pay more if I haven't made a single claim in the last 24 months. On the other hand, if you had any, also consider the amount you claimed and how this relates to your insurance raise.

Still, no matter what, prices will always go up. 

Don't be Afraid to Negotiate: Here some Tips

Nothing terrible will happen if you don't renew. It is not a cancellation or a contract breach. You can always go and check with other providers in your area. I would encourage you to always check it first, before coming into a negotiation with the insurance agent. 

Based on my experience, insurance agents are usually able to go down up to 10% off of the negotiation price. Additionally, evaluate all the possible options for additional discounts before going that far.

Step #1 - Gather Info: Quote other providers. Here you can quote 30 Canadian Companies in less than 3 minutes.

Step #2 - Contact your Provider: Call your insurance agent and connect with a salesperson. It is always good to have all the numbers in hand: your current contract, the new policy price, and the alternatives from other providers.

Step #3 - Negotiate: There is nothing bad with negotiating your insurance contract renewal. Your provider proposed first and now you can make yours. Here are some sample scripts you can use ;)

(I encourage you to read these all, but use one or two of these arguments, not all of them)

  • "I haven't submitted a single claim in the last two years. Is this the best quote your company can offer?"
  • "I acknowledge your offer is very fair, but I won't be able to afford that price uprise. Is that the best your company can provide me?"
  • "You can save us both some time of shopping around and offer me a price more suited to what I was expecting."
  • "If you make it 15CAD/month cheaper, I confirm my renewal right now."

At this point, agents will always recalculate your premium. If there is a slight chance of keeping you as a client, they will exploit it during the call. Good luck!

There are Always Options

It is not a lousy negotiation if things didn't work out; sometimes, things just don't. The most important thing is that you find the right price and don't fall for one that way out of your budget.

About the author

Jorge Diaz is a passionate car lover, winter driver & Software Engineer. For the last 10 years, he has built Online Solutions used by more than 5,000 companies across the globe. He founded LeaseCosts in 2016 with the purpose of simplifying and helping Canadians to better understand the complex market of car leasing in Canada. You can connect with Jorge at or send him a direct message.