More vehicles are being written off by insurance companies after minor accidents. Here is why

The Gardiner Expressway is seen with heavy traffic in Toronto, on Wednesday, June 28, 2023. THE CANADIAN PRESS/Andrew Lahodynskyj

Vehicles today are safer than ever, with systems designed to keep you in your lane, control your speed, and prevent crashes. However, these added safety features are making cars more expensive to repair, increasing the chances of your vehicle being written off after a crash.

One Ontario woman said she was shocked when her car was involved in a minor fender bender and was written off instead of being repaired.

“I was waiting at a red light and as we were about to proceed someone jumped the gun and bumped into my car,” said Carolyn Riley-Joseph of North York.

Riley-Joseph told CTV News it was in August when another driver ran into the back of her 2020 Jaguar E-Pace. The rear bumper was damaged, but she said the car did not appear to have major issues, so she decided to take it to a body shop to get a quote for the repairs.

“The first quote was $4,000, but he told me once he put it up on the hoist, they may find more damage underneath,” Riley-Joseph said.

She was then requoted for $8,000, and after the insurance adjuster checked the car, she said she was told it could actually be as much as $15,000.

Despite her Jaguar only being five years old with 75,000 kilometres, Riley-Joseph said her insurance company eventually told her it would be written off and she would receive a cheque for $26,000.

“I was like, ‘this is ridiculous, the airbags didn’t go off,’” she said. “There is no extensive damage. There is no damage to the frame or anything like that, I thought, ‘this doesn’t make sense.’”

Riley-Joseph’s insurance is with Echelon. When CTV News contacted the company on her behalf, a spokesperson said in a statement, “Due to privacy reasons, we can’t discuss the specifics of any claim, but we always work closely with our Broker partners to ensure that our insureds understand their coverage, and have purchased adequate coverage for their individual needs.”

“When a policyholder is involved in a collision, typically the vehicle would be a total loss when the cost to repair the vehicle is higher than the actual cash value (ACV) of the vehicle. However, it is not always practical to repair a vehicle, even if the cost of repair is less than its ACV.”

According to the Automotive Industries Association of Canada (AIA), a group that represents those who work in the collision and mechanical sectors, cars are being deemed a total loss more often as parts cost more, and there are delays to get them.

“A total loss is just an insurance companies most economical way to settle a claim. It’s just mathematical decision,” said Stuart Klein, vice-president of collision programs with AIA Canada and executive director at I-Car Canada.

Repairs have also increased in price as have rental car costs. However, Klein said the main reason more write-offs are happening is the complex safety systems cars now tend to come with which use cameras, radars and sensors.

“We have to replace more and more parts than we did in the past and that is driving up the costs of repair,” Klein said.

Riley-Joseph said she is frustrated because she still owes more for the car than what she’s being offered. However, she said the insurance company is moving ahead with plans to write-off the SUV, even though she feels it should be repaired.

“Honestly, I don’t think there is a reason for my car to be written off so I would like it to be fixed,” she said.