Modern vehicles are safer and smarter than ever, equipped with technology that helps drivers stay in their lanes, control speed, and avoid collisions. But these same features are making cars far more expensive to repair — leading insurance companies to declare more vehicles a total loss, even after relatively minor accidents.
Carolyn Riley-Joseph of North York experienced this first-hand after her 2020 Jaguar E-Pace was rear-ended at a red light in August. “I was waiting at a red light and as we were about to proceed someone jumped the gun and bumped into my car,” she said.
At first glance, the damage to her bumper seemed minimal. But when she brought the vehicle to a body shop, the initial repair quote was $4,000. Once the car was put on a hoist, potential hidden damage drove the estimate up to $8,000. An insurance adjuster later told her repairs could cost as much as $15,000.
Despite the Jaguar being only five years old with 75,000 kilometres, her insurance company decided the vehicle was a write-off and offered her a settlement of $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.’”
Echelon Insurance, her provider, declined to comment on her specific claim but explained that vehicles are typically deemed a total loss when the repair cost exceeds the car’s actual cash value (ACV). In some cases, insurers may still choose to write off a car even if repair costs are slightly lower, citing practicality and turnaround time.
Stuart Klein, vice-president of collision programs with the Automotive Industries Association of Canada (AIA) and executive director at I-Car Canada, said this trend is increasingly common. “A total loss is just an insurance company’s most economical way to settle a claim. It’s just a mathematical decision,” he said.
Klein explained that the rise in write-offs is driven by the expensive and complex safety systems found in newer vehicles. Repairs often require replacing multiple components — from sensors to cameras and radar units — and parts delays can add to the cost. Rental car expenses during repair periods have also climbed.
“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.
For Riley-Joseph, the decision to write off her SUV feels unfair, especially since she still owes more on the vehicle than the settlement amount. “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.