New auto insurance policy launched for borrowed vehicles

Quebec’s financial regulator and an auto insurance group have announced the launch of a new auto policy designed for drivers who don’t own a vehicle.

Regulator Autorité des marchés financiers (AMF) and Groupement des assureurs automobiles (GAA) said Monday the new policy – Quebec Auto Insurance Policy No. 2 – Insurance for drivers who do not own a vehicle (Q.P.F. No. 2) – and its endorsements are for those who use vehicles belonging to third parties, and wish to benefit from full insurance coverage.

Losses that occur while the vehicle is being used as a “taxicab, sightseeing vehicle, bus, coach or other chauffeur-driven vehicle” are excluded, although they may be covered through an endorsement.

The new policy reflects the emerging needs of consumers, who are increasingly turning to the sharing economy, notably for vehicle sharing, AMF and GAA said in a joint press release.

“This paradigm shift requires a new form of coverage for drivers who do not own a vehicle,” said Johanne Lamanque, general manager of GAA. “The new policy offers them an innovative product that provides coverage for the vehicle borrowed, as well as civil liability coverage.”

Policyholders are covered when the rented or borrowed vehicle damages property, or injures or kills another person. The policy also provides coverage when the rented or borrowed vehicle is damaged or stolen.

Drafted by GAA members and AMF representatives, the new form is written in easy-to-understand language, part of an initiative to promote a better understanding of auto insurance policies by consumers. “The committee members worked together closely to develop Q.P.F. No. 2 to ensure it meets the needs of non-owner consumers,” said Louis Morisset, AMF’s president and CEO. “The policy is simpler, clear and easy to understand for consumers. This is reflected both in the wording used and visual presentation.”