What drivers with oft-stolen cars are paying for insurance

Drivers of Canada’s Top 10 stolen cars are shelling out about 37% more than the average price for comprehensive insurance coverage, according to recent data from RatesDotCa’s quoter.

In Ontario, average annual auto insurance premiums were $1,796 as of October 2023, up 7% year-over-year, according to data from the Financial Services Regulatory Authority (FSRA). The average premium price in the Greater Toronto Area (GTA), at $2,391, was also up 7% year-over-year.

In addition to raising rates, some insurers have also established surcharges for clients of commonly stolen vehicles, or those who live in areas at high risk of theft.

Still, the risk appetite for auto insurers varies, and that’s one reprieve brokers have for helping their customers.

“Where consumers are feeling the burn with one particular insurance company that they’re with, [an auto insurer] impacted by these high levels of theft, it doesn’t mean that all companies have been impacted the same,” says Daniel Ivans, RatesDotCa’s insurance expert and licensed insurance broker.

“Brokers are often finding themselves having to pivot to other companies that might be better options for consumers who are receiving these increases.”

That pivot, or shopping around for better rates, is something brokers are doing daily for their clients, Ivans says.

“For a broker, if they’ve identified [a client’s] vehicle [is] commonly stolen…the priority [will] be to focus on the solution for the consumer, which is finding a company that isn’t having the same negative impact or otherwise isn’t charging the same price or surcharges for their particular scenario — be it age, location, vehicle — whatever the case may be.”

Theft is decreasing. Will premiums?

Auto theft claims costs hit a record high of $1.5 billion in 2023, Insurance Bureau of Canada reported. That’s been on the incline for years, before national concern caused Canada’s federal and provincial governments to intervene, alongside the insurance industry, law enforcement, and the Canada Border Service Agency (CBSA).

That intervention has helped auto theft decrease 17% nationally thus far in 2024, though it’ll take time for this to filter through to cost improvements for customers, Ivans says. But that’s dependent on theft continuing to trend downward.

“The decreases are really encouraging,” he says. “The hope would be that as auto thefts continue to decrease — if they do indeed continue to decrease — that they will not be having as large of an impact on insurance premiums.”

He says insurers, and how they set their rates, are responsive to trends.

“One example would be during COVID,” he says. “Insurance companies, some of them, took on rate decreases because trend lines changed. There were fewer people on the road than anticipated and, as a result of that, there were fewer claims. So insurance companies were either taking on decreases or, in some cases, actually sending refund cheques to consumers.

“Now claims patterns have again changed, but in the opposite way, where you see an increase in thefts.”

That’s in addition to increasing claims costs due to climate change, national inflationary increases, and rising costs of labour and parts. Not to mention, the repairable claims cost in Canada is $5,044 — a 12% increase since the previous year.