Comprehensive Insurance: A Top Tool Against Car Theft
Car theft has been on the rise in Canada and consumers are watching how it can impact their car insurance premiums. Oliver Belisle is Market Relations Manager at Western Financial Group in Victoria and he follows car insurance trends. Oliver tells us how car theft can impact car insurance rates, which car insurance coverage protects against theft, and what steps you can take to stop thieves from stealing your car.
Give us a snapshot of what is happening with auto theft in Canada
Vehicle theft has increased exponentially in the last few years and a big factor in this is the shortage of supplies, parts, and inventory, which happened during the COVID-19 pandemic.
A lack of new vehicles has led to inflated prices for used vehicles, which has made theft more attractive because there’s more money to be made than in previous years.
Car theft has become a much more profitable line of business. Ontario and Quebec have been hit particularly hard.
How does this upward trend in auto theft impact insurance premiums?
In certain pockets of the country, you are going to see rates go up, but we have to be clear that the only rates impacted by theft are comprehensive rates.
Your auto insurance is comprised of many different coverages. There's liability, collision, and comprehensive (or variations of comprehensive such as “all perils”). Comprehensive insurance protects your vehicle from losses unrelated to collision, losses that aren’t the driver’s fault.
For example, a tree falling on your car would be a comprehensive claim. If you hit a deer while you're driving in the middle of the night, that would be a comprehensive claim. If there's a flood and your vehicle is swept into the river, that’s a comprehensive claim.
Theft would also fall under comprehensive coverage.
The only coverage whose rates will be impacted as a direct result of auto theft is comprehensive coverage. If you’re worried about your car getting stolen, make sure to get comprehensive coverage. Not only does it protect you against theft, but it also helps you with a wide range of losses as outlined above.
What do insurance companies know about car theft?
Insurance companies nowadays are very intelligent. They use algorithms and AI (artificial intelligence) to determine exactly where you're more likely to get hit by theft. They even know the types of vehicles that are more likely to be stolen.
So, if you're not in a high-risk area or you're not driving a vehicle that's on the hot list, there shouldn’t be a huge impact on your insurance, if any, based on the theft.
What are some steps you can take to help prevent your car from being stolen?
Thieves nowadays have access to new methods and new technologies, and they're able to, basically, take your car in about five minutes time, wherever it is.
One way to prevent theft is with a low-tech parking move, and that is to park in such a way as to ensure that your vehicle is boxed in by the other vehicles.
What about anti-theft devices?
Theft devices can reduce the likelihood that your car will be stolen, but even better are theft recovery devices. A recovery device is installed in your vehicle so that you can literally track it in real time in the event it is stolen. If your car gets stolen, you would be able to tell the police where it is, which helps with the recovery of the vehicle. In some ways, this is actually more important because recovery rates for stolen vehicles are extremely low.
Another thing to note is that your key fob is always emitting a signal and even though your fob is in the house, thieves can steal the code and use it to get into your vehicle. You can protect your key fob by placing it inside a Faraday Bag, which blocks the signal emitting from your key fob and prevents thieves from cloning it to steal your car.
What if your car gets stolen?
Call the police to report that your vehicle has been stolen. Then call your insurance company to open a claim and give them the police file number.
Car theft has been high in Ontario and Quebec. If you're living in those provinces and you're living in towns or cities where you know theft is on the rise, be more cautious. Park in well-lit places, use an anti-theft and tracking device, and follow best practices. It may not prevent your vehicle from getting stolen, but it'll reduce the odds.
The best things to do are to make sure you've got comprehensive coverage on your policy which will cover your vehicle for theft, invest in a tracking/recovery device, and a bag that will block your key fob signal.
Awareness is key. When you’re aware of car theft, you’re going to be more cautious and take steps to protect your car to help reduce the odds of it being stolen.
