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Record increase in car insurance prices in Canada after rise in car theft rates

Record increase in car insurance prices in Canada after rise in car theft rates

By Mohamed nasar

Published: June 1, 2024

After car theft became a phenomenon in Canada, this crisis has become a concern for Canadians and the government recently, to the extent that the anxiety surrounding the crisis has intensified, raising fears among those whose cars have not been stolen.

A report from the Insurance Bureau of Canada (IBC) indicated that insurance companies in 2023 were in a bind due to insurance claims related to car theft, which exceeded $1.5 billion, marking the second consecutive year in which car theft claims surpassed the billion-dollar mark.

The year 2023 represents a 254% increase over the amount claimed in 2018, which was approximately $440 million.

Insurance companies have announced compensating for losses by increasing insurance premiums for customers.

Daniel Evans, an insurance expert at RATESDOTCA, stated that this action taken by insurance companies is an expected outcome, and drivers bear the responsibility.

Evans added that the rising rates of car theft continue to drive premiums higher as insurance companies try to balance the costs of unprecedented claims. For drivers of commonly stolen vehicles, it is extremely important to shop for car insurance, as prices can vary significantly from one insurance company to another, depending on claims costs and how risks are assessed.

Drivers of Honda Accord, CR-V, Civic, Ford F-150, Toyota Highlander, or RAV4 face an increase of 37% above the average cost of comprehensive premiums, according to data from RATESDOTCA.

On the other hand, the federal government announced that it would allocate nearly $43 million to combat rising car thefts, as Public Safety Minister Dominic LeBlanc clarified that assisting local police plays a “critical role” in combating car theft.

Reports indicated that most car thefts occur in Ontario; during 2022, the province accounted for about $700 million of the total theft claims of $1 billion, with an increase of nearly 300 percent compared to 2018.

Ontario became the first province last year to reach $1 billion in car theft claim costs.

The Ontario government announced in 2023 that it would provide $51 million to help police dismantle criminal gangs involved in organizing the thefts.

There has been a reported increase in theft rates across Ontario of 72% from 2014 to 2021, and an increase of 14% during 2022, according to provincial statements.

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