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New option for auto insurance – Be careful!

Talk to your broker about Direct Compensation Property Damage coverage

The government will be implementing a new option for your auto insurance as of January 1, 2024. You may be surprised to hear that not all options the government gives you will serve your best interests.

There is a section in the auto policy called DCPD or “Direct Compensation Property Damage”.  This is the part of the policy that provides coverage for you if you are in a not at fault accident.  As of January 1, 2024 this will become an optional coverage that can now be removed, HOWEVER in removing this coverage, your Collision coverage (used in the case of an at fault accident) will also be removed.

The motivation behind this new option is to offer Ontarians more flexibility and potentially reduce their monthly premiums. However, making this choice could entail substantial out-of-pocket expenses for drivers if they find themselves in an accident even where they are not at fault.

Many people don't feel comfortable gambling that they will not have an accident so they carry collision coverage to cover the cost of repairing or replacing their vehicle. If you remove DCPD you are gambling that everyone else on the road is a good enough driver that they won’t hit you and cause you to have to pay for your own repairs or replacement.

It’s always a good idea to look at your insurance and speak to your broker to look for potential savings – and there are options available, however we at Orr Insurance don’t feel that removing DCPD is a great option for very many people.

Look for notices from your insurance company as your policy renews, it is called the OPCF 49. If you have more questions about it – contact Orr Insurance, they are always happy to talk about insurance!

Article provided by Rick Orr, RIBO, CIP


Rick is Owner/Account Executive at Orr Insurance & Investment.  He has been in the industry since 1990, joining the Orr Insurance & Investment team in 1992.  His areas of expertise include personal and commercial insurance.    Rick is married and enjoys spending time with wife Jane, and daughters Sydney & Kaylee.  He enjoys skiing and anything involving being on the water.  Rick currently sits on the board of the Registered Insurance Brokers of Ontario (RIBO) Ontario’s regulatory body for insurance brokers.  He also serves as a board member of the Stratford Hospital Foundation, Chair of HPHA Stratford’s Local Advisory Committee and Chair of the Stratford Board of Park Management in addition to being a member of the Rotary Club of Stratford.  Rick is a past president of the Insurance Brokers Association of Ontario and a former member of the Board of Governors of the Stratford Festival.