Canadian Market (January 01, 2008)

Auto thieves targeting high-end vehicles

The Insurance Bureau of Canada (IBC) says its investigations over the past few years illustrate an alarming trend in Canada of organized auto theft rings targeting high-end or desirable vehicles with the intention of exporting them overseas or chopping them for parts.

It made this observation during the release of its list of the most frequently stolen vehicles in 2007.

Luxury vehicles appear prominently in the IBC’s 2007 Top 30 list of stolen vehicles. For example, three 2001 Audi Quattro models appear in the list.

“These models have moved up an average of 26 spots from their positions in the 2006 list, showing that the relative demand for these high-end, desirable models is increasing,” said Rick Dubin, vice-president of investigations at IBC.

Theft of newer, four-wheel drive vehicles is also increasing, the IBC notes.

According to the IBC, the Top 10 stolen vehicles in Canada in 2007 were:

* 1999 Honda Civic SiR 2-door

* 2000 Honda Civic Sir 2-door

* 2004 Subaru Impreza WRX/WRX STi 4-door AWD

* 1999 Acura Integra 2-door

* 1994 Dodge/Plymouth Grand Caravan/Voyager

* 1994 Dodge/Plymouth Grand Caravan/Voyager AWD

* 1994 Dodge/Plymouth Caravan/Voyager

* 1998 Acura Integra 2-door

* 2000 Audi TT Quattro 2-door coupe

* 1994 Dodge/Plymouth Shadow/Sundance 2-door hatchback

Transport Canada proposes to relax rules for importing U.S. cars without immobilizers

Transport Canada is proposing an amendment to the Motor Vehicle Safety Regulations (MVSR) to make it easier for Canadians to import vehicles from the United States that are either already equipped with an electronic immobilization system “or can be fitted with one.”

As of Sept. 1, 2007, motor vehicle safety regulations require that all new cars, vans, light trucks and SUVs sold in Canada or imported into Canada come equipped with electronic, anti-theft immobilizers.

“Canada requires these systems in response to the public’s desire to reduce the trend of thefts for convenience and to protect innocent parties from serious accidents, injury and death,” the government announced.

Currently, the government does not register cars made in the United States that do not meet Canadian standards for anti-theft immobilizers.

But the government said its new proposal would “offer more flexibility to Canadians wishing to import vehicles and maintains efforts to ensure safety on our roads.”

“Our government is committed to ensuring safety on Canadian roads and highways,” said Lawrence Cannon, the minister of transport, infrastructure and communities.

“This amendment will simplify and clarify the process for Canadians importing U.S. vehicles, to ensure those vehicles meet our requirements with respect to anti-theft immobilizers.”

The government noted imported vehicles might have to be modified to meet requirements for daytime running lights, child tether anchorage systems and anti-theft immobilization devices.

IBC to track domestic oil spills in Atlantic Canada

The Insurance Bureau of Canada (IBC) has launched a project that will accurately track domestic oil spills in Atlantic Canada for the first time.

The data will be provided to governments as part of an effort to introduce and strengthen legislation for the installation, maintenance and replacement of domestic oil tanks.

“IBC is undertaking this project because there is a clear need to understand the extent of the growing problem of domestic oil spills,” said Don Forgeron, vice president, Atlantic, of IBC. “While individual insurance companies have collected data on domestic oil tank spills for some time, this project introduces consistent reporting across the industry.

“We believe that this is the first step in demonstrating the need for stronger legislative action to prevent spills in the future.”

Currently, Prince Edward Island and Newfoundland and Labrador have legislation dealing with the installation and replacement of domestic oil tanks. Nova Scotia and New Brunswick do not have such legislation.

IBC said it would be advocating for similar legislation in New Brunswick and Nova Scotia, while at the same time providing valuable data that can be used to potentially improve current programs in Prince Edward Island, Newfoundland and Labrador.

Most domestic oil tanks hold around 1,000 litres of oil. Just one litre of leaked oil can contaminate 1 million litres of drinking water, IBC notes in its release.

Alberta farmers file record number of hail-related storm claims

Agriculture Financial Services Corp. [AFSC] paid out a record of more than 7,200 hail-related claims this year. The Alberta crown corporation (with a private-sector board of directors) provides farmers and agribusinesses with crop insurance and farm income disaster assistance.

The Edmonton Journal reported that a record 89 hailstorms flattened farmers’ fields in the summer, resulting in a Cdn$150-million loss for AFCS.

“It was a bad year for farmers and a bad year for us,” the Journal quotes Gilbert Goudreau, AFCS’ manager of adjusting services as saying. “Usually, certain areas will get hit by hail but this year, whether it was Peace River or Lethbridge, there was heavy hail across the province.”

Some farmers got hit five times, the Journal noted. The paper also reported that many farmers have both a hail endorsement on their crop insurance, as well as straight hail insurance.

“The total number of farmers filing claims was around 5,500, more than one-third of the insured farmers,” Goudreau told the Journal. n

Beware of business interruption goblins

Underwriters should be aware that seemingly “harmless” business interruption (BI) coverages — such as for interdependent and contingent losses, power outages and the financial consequences of prevented access — might accumulate into a big payout should a claim occur, Swiss Re warns.

In its report, The Vitzliputzlis of Business Interruption Insurance, Swiss Re likens these kids of BI coverages to a “Vitzliputzlis” — a quirky stage ghost in plays or mischievous hobgoblins at Halloween that appear to be harmless, but will seek revenge on anyone who mistreats them.

Many supplementary covers with potential side effects appearing in BI policies may similarly come back to haunt insurers later, Swiss Re notes.

Stand-alone or supplementary insurances are sometimes seriously underestimated in three ways:

* premium calculations;

* analysis of the cumulative risk potential; and

* loss assessment and claims settlement.

The report says some of the most “severely underestimated vitzliputzlis” include:

* business interruption following damage at customers and suppliers;

* covers following power outages or other utility failure;

* impaired attractiveness of the location; and

* shutdown or restriction of operations due to losses other than property damage.