How Auto Theft Affects Your Car Insurance Premiums


According to the Insurance Bureau of Canada auto theft causes a $35 rise in premiums for each policyholder. Another $1 billion annually is spent on court proceedings and policing costs. The problem is affecting everyone, even though the resulting costs may not be obvious.

Many consumers don’t know how auto insurance adjusts their rates to reduce loss. This issue will be addressed below. Learn how insurance companies assess the possibility of your vehicle being stolen. We will also offer some suggestions on how to prevent theft and what to do if it does happen.

Auto Theft and Your Comprehensive Coverage

Your comprehensive coverage will cover the cost of any vehicle theft. Your insurer may not send you a check to replace your car. It all depends on the amount of your coverage and how high you pay for it.

Let’s say you have a Mercedes-Benz CL 2011 that is more than $100,000 in value. Your comprehensive coverage limit is $75,000 and your deductible $1,000. Your insurance company will send you a $74,000 check if your car is taken. The $26,000 balance will be your responsibility.

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Notable is the possibility that your comprehensive premiums could increase after your claim has been settled. If your car is worth less than its replacement value, you can drop coverage. This is a great strategy to lower your rates. You can also purchase a vehicle that is less likely to be stolen.

A CLEAR View of The Potential For Auto Theft

Insurance companies use a rating system to assess the risk of claims-related losses, including auto theft, for each make and type. It’s called the Canadian Loss Experience Automobile Rating System (CLEAR). The risk that vehicles pose to insurers is what makes them fall into different categories. Each vehicle is assigned a rating.

Statistics show that consumers who buy cars with a low CLEAR value are statistically less likely have their cars stolen. In this case, insurers might be more inclined to reduce their comprehensive premiums.

While some vehicles are less attractive to thieves, they still have high losses experience due to other circumstances (e.g. Collisions-related injuries. These vehicles might lower your annual premiums but they could increase the cost of other coverages. This is important to remember when looking at Canada’s least stolen cars.

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How to Prevent Your Car from Being Stolen

It is best to avoid your car being stolen. If you plan to leave personal items in your car, ensure they are not visible. Place them in the trunk or cover them. A thief may try to steal a brand-new laptop if it is sitting in your passenger seat. You should also make sure that you have property insurance to protect your personal belongings, as your auto insurance is unlikely to cover them.

The second is to never leave your car running. A skilled thief will take your car in a matter of seconds. Make doing so difficult. Lock the doors and windows, then take your keys.

Third, don’t park in isolated or dark areas. These settings are a magnet for car thieves, as they can operate in a safe environment and not be noticed.

Fourth, vehicles built after 2007 must be equipped with an immobilizer. It cuts critical circuits to your engine’s start-up wires automatically. It makes stealing your car more difficult. It may not be available if your vehicle was manufactured before 2007. Consider installing an aftermarket unit.

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What to do if your vehicle is stolen

Contact the police immediately after you have realized that your car was taken. Ask the officer to give you a report number. If you have comprehensive coverage, then call your insurance company and file a claim. You will be asked to give the representative your police case number and details about your vehicle. The representative will explain the reimbursement process, based on your coverage.