The benefits of being insured on one or both sides

Whether being insured on one side or both sides is best for you mostly depends on your situation.

The process of being insured on one side or both sides brings significant differences: being insured on one side can mean saving on premiums and means that the injuries to another party are covered in an accident, but the consequences can be costly. Opting to be insured on both sides offers more protection as this type of insurance protects you in case of losses related to theft, vandalism or a collision.

Being insured on one side means that drivers are covered in case they cause injuries to others while driving, which means that drivers will not be financially responsible for these injuries. Being insured on one side is also referred to as "third-party coverage."

Being insured on both sides expands coverage to pay for losses suffered by the driver. With this insurance, loss related to theft or vandalism will not be the financial responsibility of the driver. When a driver is insured on both sides, collision coverage will reimburse the driver for damage to his or her vehicle during an accident.

If you opt to be insured on one side, what would you do if your vehicle was totalled in an accident? Most people do not have the financial resources to pay for a replacement right away. If you're holding a car loan when your vehicle is totalled, you are still responsible to pay off the balance of the loan.

Being insured on both sides takes a lot of the financial pressure off of your shoulders. Transport Canada reports that there are more than 120,000 collisions involving injuries each year. Accidents happen, and even the most careful drivers cannot avoid dangerous situations on the road. Being insured on both sides gives you peace of mind by taking the financial responsibility for theft, vandalism or collisions off of your hands.

While being insured on both sides is generally beneficial, some people can take advantage of saving on premiums by opting to be insured on one side. If you drive an older vehicle that is completely paid off and not worth a lot, it may be best for you to choose to be insured on one side. However, any injuries you suffer during an accident are unlikely to be covered by this type of insurance.