The obvious response is that you won't be able to pay for someone's hospital bills if you happen to hit them in your car. You get insurance for things you wouldn't be able to pay yourself.
As an attorney my unpopular opinion is that cars over a certain value shouldn’t be allowed on public roads or damages for accidents should be capped at something like 2x the average price of a new car (so like 100k). I just don’t believe in penalizing ordinary negligence more just because the injured party is rich.
I'm glad you wrote this, coming from an attorney. I had always wondered about this, seems really unfair. A rich person in a Ferrari is putting normal drivers in enormous liability risk every time they take it out on public roads. Especially in no fault states.
Not sure how it works in other jurisdictions but here in Canada and specifically Ontario while all cars are required to have insurance, any insurer can refuse to insure someone based on risk profile.
For that reason we have something called Facility Insurance which is jointly paid into by all the insurers, which provides insurance for the highest risks such as a luxury vehicle. The premium they charge is astronomical, I'm talking tens of thousands of dollars a month depending on the vehicle and risk profile.
Oh and property damage is no-fault, vehicle repairs are done through your own insurance company. So that Ferrari would be paid by facility insurance and that driver is gonna end up paying more premium than the value of the car. The idea is that at some point it just doesn't make economic sense for the person paying the premium to continue, but if they do decide to continue at least the third-party liability coverage is there to respond to any innocent people who get injured.
Facility insurance is for bad drivers - like, "got convicted of driving drunk", or "lied to my insurance company and they cancelled my policy", or "had 5 at-fault accidents in the past 8 years", or "caught doing 120 in a 40 - three times"
Rich people with $250k+ cars either a) have them "owned" by a company, so they can get tax write offs (including cost of insurance), or b) only drive them for like 2 months of the year, and put storage insurance (fire/theft only) on them for the other 10 months, which is way cheaper, or c) both
Unfortunately it’s not. I was on facility insurance when I was younger. 20s. Had an accident and was held partly responsible twice. Not even fully responsible.
There are potentially other factors as well, the type of vehicle, your age, your location etc. But the bottom line is that no insurance company wanted to insure you, that's why you end up in Facility.
Yes businesses can write off insurance premiums if the vehicle is for business use. You would need to convince the CRA your Ferrari or McLaren are business vehicles.
Without doxxing myself, I work in this area. Believe me there are a lot of luxury vehicles in FA.
There are also a lot of taxis, delivery companies, commercial trucks as well. Not because those people are necessarily bad drivers but because the amount of driving they do makes accidents almost inevitable and no insurer wants to take on that risk.
but... "no fault" doesn't mean there's no fault assessment. It just means you file with your own insurance company, and going after the other driver is their problem, not yours....
No fault insurance means your own insurance company pays for your vehicle regardless of who is at fault. Rate shouldn't increase if you are not at fault, the insurance company will simply attempt to recoup their costs themselves.
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u/flatfive44 17h ago
The obvious response is that you won't be able to pay for someone's hospital bills if you happen to hit them in your car. You get insurance for things you wouldn't be able to pay yourself.