Sep 12, 2024
Some insurers add up to $1,500 surcharge on vehicles targeted for theft
Insurers and government officials are still looking at new ways to combat vehicle theft. One of these proposals includes vehicle surcharges and driver’s licence suspensions if you are convicted of motor vehicle theft.
The Insurance Bureau of Canada reports that auto theft-related claims in Ontario have surged by 329% from 2018 to 2022. This topic has been gaining traction on our website, along with the most stolen vehicles in Canada and the top anti-theft devices.
Find out how much the vehicle surcharge can be and what to do if your vehicle is on the list.
Three main takeaways about insurance surcharges for theft prone vehicles
- Insurance surcharges are nothing new. They began rolling out in 2023, drivers are seeing an increase in their car insurance in Ontario due to theft
- Vehicles with a higher chance of being stolen will see higher rates and a surcharge up to $1,500.
- Be sure to always check the requirements and vehicles for the surcharges outlined by your coverage provider.
What’s on this page
What is the car insurance surcharge in Ontario?Insurance companies are adding a $500 surcharge to policies of commonly stolen cars in Ontario
Are insurers applying a surcharge to all vehicles?
Vehicles with theft surcharge applied
How does the surcharge impact commercial vehicle policies?
How to remove a car theft surcharge
Insurance surcharge for vehicles FAQs
What is the car insurance surcharge in Ontario?
Most policies will cover you if your vehicle is stolen. But due to the increased risk of theft of certain vehicles, insurers have added a surcharge on the most targeted vehicles to combat the increasing claims costs related to car theft.
Some insurers have decided to increase the High Theft Risk Premium Surcharge from $500 to $1,500 for new business and renewals starting June 30, 2024, as the auto theft crisis continues to evolve.
Insurance companies are adding a $500 surcharge to policies of commonly stolen cars in Ontario
When customers buy a vehicle that is at a high risk of theft or currently own one, their Ontario auto insurance premiums could significantly increase. You could see increases from $500 to $2,500 per year. You could also see a surcharge of up to $1,500 added to your premium. However, this surcharge can be waived by installing an insurance-recognized theft prevention system, such as Tag.
Additional costs and approved devices will vary based on your insurer. Speak to our brokers if you have a surcharge applied to your premiums.
Are insurers applying a surcharge to all vehicles?
Not all vehicles are impacted or considered high risk for theft. Insurers are focused on vehicles that have seen an increase in the number of occurrences of theft claims. Rather than raising rates across the board, insurers are limiting this surcharge to the specific vehicles identified. Here is a look at what some providers are doing, according to Insurance Business Mag:
| Insurance Company | Surcharge |
|---|---|
| CAA | A surcharge of $1,500 unless car owners take recommended actions |
| Aviva | $500 surcharge on high-target cars if a TAG or KYCS system (not subsidized) is not installed | Pafco | $1,500 surcharge that can be removed by having a TAG system (subsidized) |
| Economical/Definity | $500 surcharge if policyholders opt out; TAG system free or subsidized |
| Chubb | $500 surcharge, with TAG systems either free or subsidized depending on the vehicle |
Vehicles with theft surcharge applied
Here is a look at some of the most common vehicles where the surcharge is applied. This list includes vehicles that are manufactured after 2020:
| Vehicles With The Insurance Surcharge Applied | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Chevrolet Suburban | |||||||||||||||
| Chevrolet Tahoe | |||||||||||||||
| GMC Yukon | |||||||||||||||
| Land Rover, Defender | |||||||||||||||
| Lexus GX460 | |||||||||||||||
| Lexus RX450 | |||||||||||||||
| Toyota 4Runner | |||||||||||||||
| Any other vehicle with an MSRP of $125,000 or greater (regardless of make or model, excluding Electric Vehicles) | |||||||||||||||
| Acura, RDX | |||||||||||||||
| Dodge, RAM 1500 | |||||||||||||||
| Jeep, Wrangler | |||||||||||||||
| Land Rover, Range Rover (including Sport, Evoque & Velar) | |||||||||||||||
| Lexus, RX350 | |||||||||||||||
| Toyota, Highlander (including Grand Highlander) | |||||||||||||||
| Honda, CR-V | |||||||||||||||
| Jeep, Grand Cherokee |
How does the surcharge impact commercial vehicle policies?
If you are a business owner, you may be wondering how this change will impact your commercial fleet insurance. Depending on your provider, you may have the following options:
- New business on an identified high-risk vehicle, the surcharge will apply.
- If the insured elects to do so, they may have Tag installed at a discount. Once the installation is complete, the policy will be updated automatically removing surcharge and discount applied.
- Premium surcharge of $500 will be applied effectively for new business and renewals.
Speak with your coverage provider to learn more about their surcharge rules and options to lower, or waive, fees.
How to remove a car theft surcharge
Some companies have different approved ways to remove the surcharge. Here is an example of what it could look like:
- Option 1: The surcharge of $1,500 for eligible after-market engine immobilizers will be fully removed.
- Option 2: If other eligible preventative anti-theft devices are installed, the surcharge will be reduced by 50% ($750).
- Option 3: The surcharge can be reduced by $500 by using eligible preventative accessories.
- No action taken: This will result in the full surcharge of $1,500 being applied.
Be sure to contact your car insurance provider to learn more about their requirements.
Limit policy increases by following proper anti-theft protocols
Choosing the correct theft prevention devices and comparing your coverage options are two ways to lower your rate and protect your vehicle. Contact us today to learn more.
Insurance surcharge for vehicles FAQs
Depending on your insurer, you’ll expect to pay between $500 and $1,500 for the surcharge.
Adding an approved anti-theft device can lower the surcharge. Each provider will have different approved methods, so always check beforehand.
The surge in theft activity has led to a significant increase in claims costs for insurance companies. Since insurance operates on a pooled risk model, these rising costs inevitably result in higher premiums for all policyholders.
To mitigate the impact of theft claims, insurers are implementing surcharges on specific vehicles that have a higher frequency of theft claims and lack preventative measures or the Tag system. This surcharge aims to incentivize vehicle owners to install anti-theft devices or participate in tracking programs, reducing the likelihood of theft and ultimately lowering costs for all.
Prevention is the first step to limiting theft and surcharges
If you add or substitute a vehicle to your policy that is on your insurance company's high-theft list, a high theft surcharge will be added. This surcharge will continue until you decide to add an approved prevention device.
If you are worried that the vehicle you choose is on your insurance company's high theft list, please contact our brokers. They can discuss the premium and your options with you.
