Renting a car for your vacation in Canada? Here’s what that means for your insurance

April 19, 2024

Have you thought about visiting Canada? Our friendly neighbor to the north is an extremely popular travel destination for Americans. The Seattle Times, has reported that 9.1 million Americans traveled to Canada in 2022. While Mexico took the lion’s share of American tourists for that year (with 33.5 million visiting the nation), Canada’s numbers are nothing to sneeze at.

So, if you’re interested in visiting Canada—like millions of others—you may have worked out how you’re going to get there. But if you’re opting to travel there without your car, how are you going to get around?

There is always the option of public transport, but if you’re interested in doing lots of traveling through the country and you don’t have access to your own vehicle, a rental car may be in your future.

This leads into a yet another question: “If I use a rental car in Canada, will my personal auto insurance policy cover any damages if I get into an accident?” Like a great deal of things in the world of insurance, the answer is “yes, but there are some caveats.”

Most auto insurance policies will extend the minimum required liability coverage to Canada. Liability insurance covers damages to other vehicles or injuries to other people if the policyholder is at fault in an accident. In addition, if a policyholder has collision and comprehensive coverage as part of their personal auto policy, this coverage typically extends to rental cars in Canada. This means damages to the rental car in the case of an accident, theft or other covered losses may be covered. However, policyholders should confirm these extensions with their agent or insurance company.

Just as you would in the States, to rent a car you need to be a certain age (usually over 25 years old), have a valid driver’s license with a photo, and some form of photo ID (like a driver’s license or a passport) and have a credit or debit card.

You also will have to get a “Canada Non-Resident Inter-Province Motor Vehicle Liability Insurance Card,” also known as a “Yellow Card.” This can be acquired from your insurer in the United States: if you drive without one in Canada, you are at risk of fines and other penalties.

Before you plan any travel, give your professional insurance agent a call to see if your personal auto insurance policy will extend coverage to your rented vehicle: if it doesn’t, you may have to purchase rental car insurance from the rental car agency if you want to have coverage for the vehicle.

When you go on vacation abroad, you should have peace of mind that your vehicle is covered in the event of an accident. While these rules apply for Canada, be sure to review the insurance rules and regulations of other countries you may be planning to visit.

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Matt McDonough is PIA Northeast's writer, editor and content curator. Matt joined PIA Northeast in September 2023. Before that, he had been an editor for the online entertainment magazine Collider from 2021-23 as a copy editor for its lists section. Matt entered the world of journalism at his alma mater, SUNY New Paltz, writing and reporting for the college's student run newspaper, The New Paltz Oracle. He graduated from SUNY New Paltz with a Bachelor of Arts in English and a minor in Creative Writing in 2020.

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