Category: Claims

While it’s eased over the past year, Canada’s auto theft rate remains above historical levels.

In the first half of 2025, Insurance Bureau of Canada data shows 12,887 theft claims were filed by insureds, with losses totalling $361.5 million. Going back 10 years, theft claims had reached 8,567 and claims losses were $120.5 million for the first half of 2015. That’s roughly 50% and 200% respectively below the same period in 2025, but still high.

Demonstrating the issue’s staying power, Canada’s federal government announced late today it will make investments in Canadian‑developed technologies designed to prevent auto theft. “Auto theft remains serious and evolving threat to public safety, and today’s announcement marks another meaningful step in advancing on the National Action Plan to Combat Auto Theft…,” says IBC vice president for Federal Affairs, Liam McGuinty, in a statement.

Helping clients

Beyond the claims problems vehicle theft creates for clients and insurers, it raises the chances that one of your clients may unknowingly buy a stolen vehicle. It’s a genuine risk for used-car buyers, says Steven Harris, a licensed insurance broker who provides commentary for LowestRates.ca.

He notes used car buyers often focus on a vehicle’s price and condition and aren’t always paying attention to the financial consequences of the vehicle turning out to have been stolen. 

Related: How planned registration upgrades can trim Alberta auto theft

“What surprises many buyers is how little protection exists once the sale is complete,” he says. “If a vehicle is later identified as stolen, it can still be seized, even if the buyer had no idea. Recovering the money after that can be extremely difficult.” 

Harris points out insurance is designed to protect vehicle owners when their own cars are stolen. It isn’t intended to protect the purchasers of cars that were stolen from other owners. “If a vehicle has been re-VINned or reported stolen, it becomes an ownership issue rather than a typical insurance claim, and coverage eligibility could be at risk,” he says. 

“That’s why the verification steps matter so much before making the purchase.”  

Years ago, stolen cars offered buyers telltale signs – marks around door keyholes suggesting forced entry, repairs around the steering column or undersides of dashboards where damage from hotwiring was repaired, and damage to the body or interior from joyriders.

Today, car thefts are more high tech. Thieves hijack an owner’s key signal and then clone a new fob. And with the help of expert cosmetic teams (and occasionally public servants) vehicle identification numbers (VINs) are changed to eliminate the trail back to the original theft. All this can make stolen cars appear legitimate.

Related: Auto insurers urge governments to close Re-VINning loopholes

Still, says Harris, not all signs of theft can be erased. So buyers need to go through a few steps:

• Odometer readings should be consistent with the car’s state of repair. A worn out vehicle with low mileage is a red flag. 
• The VIN on an ownership permit should match the number plate that’s visible both under the windshield and on the driver’s door frame. Look closely for scratches, loose plates, or numbers that don’t fully match. 
• Check the name on the vehicle’s registration against a government-issued ID from the seller. Ontario provides a Used Vehicle Information Package that gives buyers an ownership history. A buyer should make sure no loans are registered against the vehicle. 
• Look up the VIN in the Canadian Police Information Centre database. It will show if the car’s been reported stolen. And report providers like CARFAX can also show irregularities, like a different owner than the one the buyer has met with.
• Buyers should beware of below-market prices. Thieves often want to onload the goods and get the cash.
• Buyers going through with a transaction should complete the sale at a financial institution using a bank draft to document the payment trail. 

Stories abound about how costly components for advanced driving systems (blind spot sensors, lane-keeping technology, etc.) are leading to more vehicles being totalled.

Canadian P&C professionals commenting on high claims costs routinely cite ‘the $10,000 bumper’ or ‘the $3,000 side mirror’ as hallmarks of why personal auto insured losses are out of control.

But an appraiser tells Canadian Underwriter the reality is more nuanced.

“The [issue] I find is that, at the shop level, we can’t always clear or recalibrate the codes for the [sensors] so [certain cars] have to be sent out to a dealer,” says Mark Fernandez, national director of operations at Accurate Auto Appraisal. “And that’s prolonging the repair time, because it’s going to be another day, or two days, for this calibration.”

For example, when a bumper is damaged, sometimes there’s problem with a sensor on the side of the bumper that wasn’t impacted during the accident. The sensor itself checks out as fine, but if that sensor is linked to one that’s damaged on the opposite side of the vehicle, it often can’t be recalibrated and will need to be replaced.

Related: Are long, pandemic-era car repair timelines making a comeback?

Fernandez gives the example of a luxury car that was hit on its left corner. “Everything cleared on the scans [in our shop]. But the customer took the car out, then brought it back and said, ‘The dash lit up like a Christmas tree.’”

That car had to go to a dealership, because the diagnostic machines at Fernandez’s shop didn’t have manufacturer-specific features needed to troubleshoot the problem. He notes many luxury vehicle makers provide significantly more detailed information to their own repair centres than they do to independent providers.

“It turned out we had to change an undamaged sensor because ‘that’s what the codes state’ for a repair to that vehicle,” he says. “It was nowhere near the impact area, but it could still be affected. The vibration [from the accident] could send it out.

“Until all body shops have a fully-trained calibration technician, we’re at the mercy of the dealership. [Most] shops will have people who know [a lot], but can’t know every vehicle. Some require a different computer that only the dealer has.”

Body shop talk

Beyond diagnostics, some routine repairs, like resurfacing damaged areas or painting a bumper to match the bodywork, can cause issues with components like parking sensors.

“There are sensors behind the bumper cover, which can lead to a whole issue because some OEM [original equipment manufacturer] specifications say, ‘no repair material over it,’ [so] you can only paint or clearcoat.”

That means if the bumper is scratched or gouged, the repair shop is unable to use body fillers and instead must replace the whole bumper. “It can be $7,000 for just the plastic cover. When you add in all the clips and sensors and radars, just the bumper can become expensive,” he says.

Related: How a few dollars worth of parts can total a vehicle

Also, the price tag varies based on the make and model. Fernandez says bumper sensors are “relatively inexpensive,” but there is a range – from $100 for some lower-cost car models to $2,500 for high-end luxury vehicles.

All that translates into a sliding scale when it comes to deciding whether a vehicle should be totalled. A more entry level vehicle (which these days can range from $30,000 and up) can have a repair involving parts like bumper sensors performed for around $4,000 and remain financially viable for an insurer and client.

And although it’s true bumpers (complete with sensors) can sometimes cost upwards of $10,000 to replace, those examples apply to luxury vehicles carrying six-figure price tags. So that repair is affordable (and not a total loss) when the high value of the car is taken into consideration, Fernandez tells CU.

It’s all relative. But, he adds, vehicle age is also a factor. Once a car passes the 10-year mark, repairs requiring costlier components can exceed the book value of the car.

Rising auto insurance premiums in Ontario have some vehicle owners opting to pay for minor collisions out of pocket rather than reporting them to insurers.

“With premiums where they are, many assume reporting a minor collision will automatically raise their rate. That isn’t necessarily true in Ontario,” says Steven Harris, a licensed insurance broker who provides commentary to LowestRates.ca.

“There are specific protections for qualifying minor accidents, and it’s important to understand how those rules apply before making a decision.”

Related: Are long, pandemic-era car repair timelines making a comeback?

Here are some things parties to a minor accident should consider before handling it themselves: 

• Sometimes it’s illegal not to report an accident to police. This includes cases of injury or death or if there is “combined property damage exceeding $5,000 across all vehicles or property involved,” Harris notes. This threshold is separate from an insurer’s reporting requirements. 
• A driver reporting an accident does not mean they’ve filed a claim. “Notifying an insurer about an accident is different from submitting a claim for payment,” he adds. “An incident can be reported to keep the insurer informed without requesting reimbursement.” 
• Ontario has a protection rule for minor accidents, which means insurers can’t raise premiums for “one qualifying minor at-fault accident if there are no injuries, no insurer payout, and damage is under $2,000 per vehicle and paid by the at-fault driver,” says Harris. The protection applies once every three years. 
• Injuries aren’t always evident immediately following an accident. In Ontario, an injured person has two years bring a claim. If a driver reports the accident, it creates a paper trail that can be relied upon if anyone involved reports an injury after the fact. 
• Minor accidents that qualify for Ontario’s protection rule might not result in a surcharge with a client’s current insurer. At-fault incidents, however, can still appear on claims history reporting. When clients change coverage the new insurer may factor that into pricing. 

“Understanding the thresholds, the protections in place, and how an accident is recorded provides far more clarity than reacting in the moment,” says Harris. 

Related: EV premiums are all over the map, auto insurance quotes suggest

What’s more, a new Rates.ca report finds auto insurance premiums make up the lion’s share of insurance costs for households in Toronto (70%) and Hamilton (65%).

“Between 2022 and 2025, the average auto premium increased from $3,453 to $3,997 in Toronto and from $2,531 to $3,096 in Hamilton,” the rate aggregator says in a press release. For Toronto, when auto and home premiums are combined, they jumped from $4,850 annually in 2022 to $5,693 in 2025. 

“Insurance prices reflect the risks insurers see in each market,” says Daniel Ivans, who provides expert commentary for Rates.ca. “In cities like Toronto and Hamilton, higher theft rates, heavier traffic, and more frequent claims all contribute to higher insurance costs for households.”

The report also finds Ontario premium growth rates vary widely. Toronto’s increase during the 2022 to 2025 study period was 17%. Meanwhile Windsor drivers saw a 34% rise, those in London and Ottawa both saw a 35% hike, and Oshawa drivers saw 37% increases.

Plus, 75% of Canadians are reporting higher premiums over the past two years. Sixty-three percent say they’ve taken steps to lower premiums – including shopping their policies around (40%), asking existing insurers for discounts (30%) and modifying their coverage (21%).

In some cases, reducing coverage to save money can raise risk levels in the event of a major claim against a driver. “Reducing coverage increases your exposure,” says Ivans.