Winter is coming and you may be battling with not only those pesky white walkers across the wall (sorry, couldn’t resist), but also the notion of getting your vehicle winter ready, and whether or not you should install proper winter tires. You’ve probably heard that you will be entitled to a discount on your auto insurance if you do, but how much validity is there to that statement? And is the cost of the discount worth the cost of the tires? Let’s find out.
Is there a discount for installing winter tires?
The too-long-didn’t-read answer to this question is yes, installing winter tires will give you a discount on your auto insurance policy. The harder question to answer is just how much does the discount turn out to be, and is it worthwhile?
Back in January 2016, the Ontario government made it mandatory that auto insurance providers must give some form of discount to those who install winter tires. This was put in place to not only make the roads safer for all, but also to help curb the high cost of auto insurance in the province. Before 2016, roughly 45% of insurers offered some sort of discount for having winter tires, but you often had to speak with your broker and ask if there was a discount available, they wouldn’t always come outright and offer it. With the new guidelines in place however, your insurance provider has no choice but to give you some form of discount, whether you ask for one or not.
But, it is still a good idea to ask how much the discount is, and to read the fine print surrounding it. There is no set amount, but most providers offer discounts around the 5% mark, however, it may not be off the whole policy itself. Some providers apply the discount to part of your auto policy; for example, Aviva applies a 5% discount to the “collision” premium, which makes up 90% of the policy. As is the golden rule with insurance, the best practice to ensure that you are getting the best discount for your winter tires is to shop around.
What are the requirements?
As long as the following are met, based off of the provision put forth by the Ontario government, you cannot be denied the mandatory winter tire discount.
- Tires must actually be installed on your vehicle (not just sitting in your garage)
- All 4 tires must be winter tires
- “All-season” tires do not count as winter tires
- Must be certified winter tires (look for the mountain peek/snowflake logo)
Some auto insurance providers may have addition guidelines separate from the ones listed above. For example, your insure may request that the tires are installed for specific months (typically late October/early November - April). And, while proof of the tire installation may not always be a necessary requirement to receive your discount, it is best not to lie to your insurer and say you have winter tires installed if you don’t. In the event of a claim made during the winter months, your insurer could request proof that you had winter tires at the time of the incident. If you fail to produce the necessary proof, your insurer may have grounds to deny your claim, or in extreme cases, future coverage. It is a good word of warning to never lie to your insurance provider.
Is it worth it?
Well, this depends, if you are looking for a purely monetary answer, then no. Say you pay around $1,600 a year on your auto insurance, the average in the GTA, and your insurance provider offers a discount of 5% for installing winter tires, that equals a discount of $80 a year. Now, say that your tires cost you $135 each, plus tax, that means you are coughing up $610 for the winter tires themselves. With this math, it would take roughly 7.6 years for the discount on your auto insurance to pay for the cost of the tires. So yes, you get a discount on your insurance, but it will take you a long while to see that money come back to you.
However, while the monetary benefits may not be incentive enough for you to make the tire switch, the safety benefits should be. It is no secret that winter driving in Ontario can be treacherous, and a little extra safety on the roads couldn’t go amiss. Winter tires have been proven over and over again to perform better in cold, snow, and ice conditions than any other tires, including the ill-named “all-season” tires. Tires other than those specifically formulated for winter weather, greatly lose their performance power once the temperatures hit 7°C.
So, it may take you years to see the monetary investment you made on the tires to come back to your in the form of auto insurance discounts, but think of winter tires as an investment on the safety of you, your family, and all those on the road. And then on top of that, think of the auto insurance discount as a nice bonus.