Does my car insurance apply overseas?

November 6, 2014

One of the main questions for Canadians travelling abroad is, "Does my car insurance apply overseas?" Here's what you need to know about international driving and your insurance.

Does my car insurance apply overseas?

Read your policy

Before jet-setting around the globe, it's important that you locate your auto insurance policy and read the fine print. This is something you should do occasionally anyway, as Canadian auto insurance procedures differ by province. If you are confused about checking your policy yourself, your insurance company should be able to assist you.

If you are not insured abroad

In the vast majority of cases, Canadian car insurance only works in Canada and the United States. Even driving in other North American countries, such as Mexico, invalidates Canadian car insurance. Except in rare circumstances, Canadian vehicle insurance, and the handy pink card that goes along with it, becomes void when visiting any country other than the U.S.

So what do I do?

If you've discovered that your Canadian car insurance is ineffective overseas, you are faced with having to secure temporary car insurance or a driver's licence in the country you are visiting. The licence question doesn't apply across the board, as many countries (especially in Europe) will simply accept your Canadian driver's licence. Some countries, such as Italy, will require you to get an IDP, or International Driving Permit. This permit works in tandem with your Canada-issued licence.

As far as insurance, there are two main routes to go: The most common one is to buy a collision damage waiver, or CDW, from the rental car company upon booking your rental car. This is the easiest option and the one least likely to result in complications. However, getting car insurance from a rental-car company can be expensive. Another option is to buy a CDW from your credit card company or to use any pre-existing international travel insurance your credit card provides. This option can be more cost-effective because the insurance is available to you and the CDW is valid in the country you are travelling to. The last thing you want is to buy coverage that is insufficient or invalid. With these pointers in mind, have a great trip and drive safely!

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