Thefts drive up insurance premiums by 25% on most stolen vehicles

As cars have become more technologically sophisticated, so have car thieves. Not too long ago, only a wire hanger or some other MacGyver-like instrument could jimmy open a door lock. Now all thieves need is a wireless transmitter to seamlessly break into a parked car via keyless entry. And so, they do, to historic highs.

A car is stolen every six minutes in Canada by organized crime. In Toronto, where auto theft is most rampant, 9,606 cars were stolen in 2022 — nearly triple the number of vehicles stolen in 2015.

According to a report from Équité Association, provinces across the country saw double-digit increases in auto thefts between 2021 and 2022. Thefts in Quebec, Newfoundland and PEI exceeded 50%-mark increases over the previous year, while Ontario saw a 48.3% spike in thefts. This trend has led insurance and enforcement organizations to label this a national crisis, citing $1 billion losses in vehicle theft claims.

And if the next few years reflects the pattern set by the last few, that rate is expected to keep increasing — unless all hands, from the government to insurance companies to drivers, hit the deck and find a solution out of it.

How thieves get into your car and what purpose they use it for

A handful of car models are stolen much more than others. Thieves are given lists of cars that are desirable overseas — more on that below — and ordered to find them in Ontario. Once they know what they’re looking for, the hunt is on.

According to Daniel Ivans, insurance broker and RATESDOTCA expert, the theft begins as soon as a perpetrator lays their eyes on a car – often in a public parking lot; say, outside a mall. They then trail shoppers home to find out where they live.

“At nighttime, they’ll steal the vehicles,” says Ivans.

Signal boosting devices can amplify the signal from a nearby key fob to trick the car door into unlocking. Once the thieves are in, they can be off in seconds, leaving nothing more than a cloud of despair and maybe a faint tire mark in their dust.

“And then they’ll find an underground parking lot and park it there for a few nights until the [stolen car] falls off the radar and police aren’t looking for it anymore,” continues Ivans. “Then drive it to the port, pack it in a shipping container and send it overseas.”

Stolen cars that stay in Canada are re-vinned (that is, their Vehicle Identification Numbers are changed) before being sold domestically to unsuspecting buyers, so they’re just as hard to trace. Occasionally, they get taken apart and their parts are resold.

Read more: What auto theft prevention devices should you use?

Premiums follow theft claims costs

When so many cars disappear from our driveways and curbsides, it doesn’t just affect the car owners. “It’s important to note these dramatic losses have fallen squarely on the shoulders of Canada’s insurers,” says the Insurance Bureau of Canada (IBC) in a statement to RATESDOTCA.

According to the IBC, theft claims costs in Ontario totaled approximately $700 million in 2022 alone – up nearly 300% from 2018.

“At the end of the day, premiums follow claims costs,” they add.

Insurance rates spike for most stolen cars in Canada

As mentioned, thieves generally target specific models of cars. The vehicles that tend to be stolen differ by province —according to the Équité Association’s latest Vehicle Theft Trend Report, organized crime rings target 2017 models or newer luxury vehicles (mostly SUVs) in Ontario, while older trucks are more likely to get boosted in Alberta.

The list includes recent models of:

Because these cars are more likely to be stolen, it is increasingly more expensive to insure them. According to data from the RATESDOTCA auto insurance quoter, comprehensive insurance premiums (where theft claims would be covered) on these specific commonly stolen cars jumped between 25% to 50% over the last two years.

For instance, drivers fitting the same profile — 35-year-old males in Toronto with no prior convictions — who took out coverage for the CR-V from the same insurer saw an increase of 26% on the comprehensive portions of their auto insurance between 2022 and 2023.

Read more: These are the top five factors that influence your auto insurance rate

Drivers will need to take precautions or pay the price

In an effort to reduce their costs paid out to theft claims, insurance companies across Canada have introduced a $500 high-theft vehicle surcharge to owners of high-risk vehicles. The surcharge will then be removed once the drivers provide a proof of purchase of an anti-theft device.

CAA, for example, have asked their customers to purchase a vehicle lock device such as a steering wheel lock (known as the club) and show proof of purchase to remove the surcharge.

“If we can better educate drivers on how to protect their vehicles, and have vehicles secure, then you've eliminated much more of the problem,” says Elliott Silverstein, director of government relations of CAA Insurance Company. “People can see that there’s a steering wheel lock on that car that’s going to require [them] to spend 10 or 20 minutes trying to break that open.”

Some companies, including Aviva, Gore Mutual, TD Insurance and others, have partnered up with the Canadian anti-theft tracking company Tag to help prevent, and recover, stolen cars. The Tag System places individual trackers on commonly sold parts of the car to make the resale of parts harder for thieves, and automobile recovery across North America more possible.

Customers who have high-risk vehicles may be charged a High Theft Vehicle surcharge at renewal unless they install a Tag tracking system on their car.

Some of these insurance partners will offer reimbursement for the Tag installation, which costs around $400, or offer a credit for the installation and remove or refund the surcharge; others remove the surcharge only.

A national crisis

Across Canada, auto theft claims have cost insurance companies over a billion dollars, according to Équité Association. And the price of these car thefts go beyond just financial — violent carjackings also jumped 78% between 2021 and 2022.

The overwhelming majority of these auto thefts are orchestrated by organized criminals, and some of the hardest hit areas for theft are major port cities like Toronto and Montreal, where crime rings will ship out their stolen goods out to other countries.

“Organized auto theft is one of the primary revenue generators of organized crime,” says Nick Milinovich, deputy chief of Peel Regional Police at a symposium held in March.

Because of the complex relationship between auto thefts and organized crime, the government of Ontario has stepped in, too. They announced $51 million in investments in May to target car thefts linked to organized crime, reduction of gang violence to dismantle vehicle theft rings, and to boost community safety and more. The investment will be carried out over the next three years.

“In order to solve this, this is going to take multiple layers,” says CAA’s Elliott Silverstein. “This is going to require vehicle manufacturers at the table, and making sure police are continuing to be vigilant. It’s requiring drivers to take the necessary precautions to protect their vehicles. Everybody plays a part in this.”

In addition to using a steering wheel club and install the Tag tracking system to their car, drivers can also ward away car-seeking criminals by keeping their keys in a signal-blocking Faraday bag at home, and parking their cars in a well-lit location overnight.