Insurance companies apparently take a lot of stock in which postal code drivers live

The disparity of car insurance rates between areas of one of Canada's biggest cities is quite simply astounding. What's even more surprising, though, is that the person living beside in the Greater Toronto Area (GTA) could be paying hundreds of dollars less per year, based solely on their postal code.

A new article from the Toronto Star outlines some of the most- and least-expensive areas to live in within the GTA in terms of car insurance. Interestingly, an area in the heart of downtown - Christie Street - costs the least, with an average annual rate of $1,479. Maybe drivers in Toronto aren't so bad - or maybe there are a lot less of them.

The most expensive area is Downsview in North York, which has an average rate of $2,422. Etobicoke (Albion) isn't far behind at $2,418, and several areas in Scarborough and North York average above $2,300!

Other areas that place on the least-expensive insurance rates list include Central Toronto (in the Davisville and Summerhill areas) and East York. All 10 names mentioned on that list average in the low-$1,500 range.

According to insurance rate comparison website Kanetix, insurance companies apparently take a lot of stock in where drivers live - more specifically, what the first three digits of their postal code is. The companies look at patterns over a period of years, and lump entire areas into specific rates, regardless of the driving records of some individual drivers - no matter how clean they may be.

The patterns are so precise, in fact, that neighbours with different postal codes living next door to each other could have hugely different rates.

The old advice remains the same when it comes to car insurance - be sure to shop around, and of course, don't be involved in any collisions. Having a magical postal code also can't hurt, apparently.

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RANK POSTAL CODE AVG. RATE MAIN INTERSECTION RANK POSTAL CODE AVG. RATE MAIN INTERSECTION
1 M3N $2,422 North York (Downsview) 1 M6G $1,479 Downtown Toronto (Christie)
2 M9V $2,418 Etobicoke (Albion) 2 M5P $1,486 Central Toronto (Forest Hill North)
3 M1X $2,373 Scarborough (Upper Rouge) 3 M4P $1,503 Central Toronto (Davisville North)
4 M1B $2,370 Scarborough (Malvern) 4 M4S $1,505 Central Toronto (Davisville)
5 M9L $2,343 North York (Humber Summit) 5 M6J $1,511 West Toronto (Trinity)
6 M9M $2,314 North York (Humberlea) 6 M4V $1,513 Central Toronto (Summerhill/Forest Hill)
7 M9W $2,253 Etobicoke (Rexdale) 7 M4T $1,515 Central Toronto (Moore Park/Summerhill East)
8 M6M $2,241 York (Mount Dennis) 8 M4G $1,515 East York (Leaside)
9 M3J $2,203 North York (York University) 9 M2K $1,529 North York (Bayview Village)
10 M3M $2,157 North York (Downsview/Rexdale) 10 M3B $1,530 North York (Don Mills North)

Photo courtesy Jeff Gauld, Flickr

Source: Toronto Star, Kanetix

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