Automobile theft in Ontario has risen to critical levels. The lack of vehicle inventory, high demand in foreign countries, and involvement of organized crime have contributed to the crisis. Auto theft makes up over one third of claims costs in Canada today, equivalent to 1.2 billion dollars annually.
Many insurance carriers have begun to take action. Most have identified High Target Theft Vehicles, with some models appearing on everyone’s list, for example the Honda CR-V, Toyota Highlander, Land Rover/Range Rover, Lexus RX350, and many pickups. If you own a High Target Vehicle, you could face a surcharge up to $500 on the Comprehensive part of your insurance premium at renewal, unless you install a TAG monitoring system or another approved antitheft device.
Insurance providers have responded in different ways:
- Some will surcharge the policy but offer a reduced or even free TAG tracking system. After the insured provides a proof of installation, the surcharge is dropped and some will even give a small discount on the Comprehensive premium.
- Some will surcharge but only in identified high risk areas (generally along Highway 401 or in the 400 core).
- Some insurers may not surcharge but will increase your deductible.
- Some do not recognize TAG but will recognize the installation of a steering wheel lock, brake pedal lock, or wheel and tire lock. Those that recognize such devices want a picture of the item installed on the vehicle (don’t send a photo of the box you bought it in, you holding the device outside of the vehicle or of it sitting in the back seat).
Some insurers have yet to take any action but you can be assured that virtually all Ontario insurers will have come up with their own solutions by the end of the 2024. It’s important to pay attention to this increasing risk and protect your property as best you can.
Aside from the cost to insurance companies which will eventually be passed along to the consumer, I would like to draw your attention to a real problem…replacing your vehicle when it has been stolen. The lack of inventory and wait times for new vehicles is unprecedented. There has been marginal improvement post pandemic but it can still take months before your stolen vehicle is repaired if it was recovered but damaged, or to receive a replacement if it was not recovered. In the meantime, you are without your vehicle. Loss of use coverage is limited to the amount of coverage you chose when you applied for your policy. Too many policyholders have inadequate loss of use or transportation replacement limits causing them to time out before their vehicle is replaced. Once the limit is exhausted, the policyholder will have to pay out of pocket to extend the rental car coverage or go without a vehicle.
Any significant claim trend will affect the premiums we all pay. Mitigating the exposure to risk may not prevent it from occurring but it can reduce the likelihood. So, before purchasing your next vehicle or renewing your automobile policy, check if the vehicle is targeted and talk to your insurance provider about how you can reduce your risk. Sound Insurance Services Inc. is pleased to offer the Group Automobile and Property Program to APA members and has been doing so for over 20 years. Call us for a quotation or if you have any questions about your personal insurance.
Debbie Arnold, R.I.B. (ON). C.A.I.B. Business Development Manager, Personal Lines
Sound Insurance
416-756-3334, extension 321