There’s perhaps nothing worse than being involved in an auto collision – except perhaps for the time it takes and the cost of renting a car while it is being repaired. The average Length of Rental (LOR) for collision-related claims is reaching 17.1 days—an increase of 4.3 days from the prior year. According to Enterprise’s 2022 Q4 data, wait times have increased 0.6 days from their Q3 results. What’s the hold up? Let’s take a look at why wait times for collision-related car repairs continues to rise.

Enterprise Rent-A Car report 

Length of Rental (LOR) for collision replacement-related rentals in Canada jumped nearly six days year-over-year, driven in part by ever-changing parts availabilities and repair backlogs, says car rental agency Enterprise Rent-A-Car. According to the report, the overall Canadian LOR was 16 days in 2022 Q2, an increase of 5.8 days from 2021 Q2. Ontario saw the largest increase of average billed days for Canada at 18.3 in 2022 Q2 (up 7.2 days from 11.1 in 2021 Q2). All other provinces saw an increase of between four and 7.1 days, year-over-year.

What’s driving this increase?

Supply chain issues affecting the car industry date back since the beginning of the pandemic. The Enterprise report states, “The results for the second quarter of this year are significant, as it appears many of the factors affecting everyone in the collision industry – including technician staffing, ever-changing parts availabilities, new and used vehicle pricing, inflationary pressures, and new claims processes – are becoming prevalent.” Industry experts say that’s partly due to delays in receiving imported vehicle parts — delays which still haven’t fully recovered from the pandemic.

Factors driving the increase in wait times include:

  • Technician staffing: A shortage of technicians is also playing a role, as many labourers left the industry permanently amid the pandemic slowdown.
  • Supply chain disruptions: The backlogged global supply chain is leading to a delay for some looking to get their vehicles fixed.
  • New and used vehicle pricing: The ongoing vehicle supply shortage in Ontario continues to cause a lot of roadblocks for buyers, including fewer options, long waits and higher prices. The way we buy and sell cars today is changing. Dealerships are having a difficult time finding inventory, and when they do, there is intense competition in the marketplace. As a result, the price of the few available new and used vehicles are almost, if not exactly, on par.
  • Inflationary pressures: This past September, Canada’s inflation rate rose to 4.4%, the highest it has been since 2003.
  • Collision repair backlogs: Many parts are on back order and some are simply unavailable for the time being. That’s meant longer wait times for repairs. In some cases, that can include anywhere from six weeks to three months, compounding the wait times.
  • Shortage of vehicle inventory: The shortage that also has a trickle-down effect for drivers looking for a rental or temporary vehicle, if their insurance doesn’t cover loss of use.

The owner of Bosco Auto Body Shop and Collision Repair in Kitchener, Ontario, says some customers have to wait more than four months for repairs. “It’s a dog-eat-dog world. And clients and consumers, people that get into collisions, into misfortunes; they are the ones paying the price,” says owner Petar Komazec. Komazec also states there’s no end in sight for the long waits.

How long will your repair take?

Drivable repairs

Ontario had the highest drivable repair increase LOR at 14.5 days (about three days more than the year previous). On the lower end, New Brunswick had a drivable LOR of 10.0 days, with PEI (10.2), Quebec (10.4) and Newfoundland & Labrador (10.4) closely following. For rentals associated with a drivable repair, LOR across all provinces was about 12.4 days (a 2.4 day increase over the previous year). “Average total labour hours [in Canada] increased to 21.78 hours, an increase of 0.61 labor hours from Q4 2021,” Ryan Mandell, Director of Claims Performance for Mitchell International, shared with Enterprise.

Non-drivable repairs

However, the average LOR is lower for drivable repairs, but even higher for non-drivable repairs. LOR for total loss-affiliated rentals also saw a seven-day increase over 2021 Q2 to 20.6 days in 2022 Q2. PEI had the highest result at 30.3 days, an increase of 19.7 days; Ontario was next highest at 22.4 days.  However, rentals associated with non-drivable claims had the largest impact on Canada’s overall results. For non-drivable repairs, insurers can expect LOR to last a full month (31 days). This is a 10.3-day increase from just one year ago!

Total loss

In the event of a total loss, length of rental reaches an average of 25.5 days across all provinces, Enterprise says. This is an 8.1 days year-over-year increase (17.4 in 2021 Q4).

Rental car insurance

If you’re already a car owner with an existing car insurance policy, you probably don’t need to purchase additional temporary insurance for your rental car while yours is being repaired. It is likely that you will already have coverage. The surprising truth is that in many (if not most) cases, you likely already have rental car insurance through one or more of these options:

  • Your personal car insurance
  • Complimentary coverage that comes with your credit card
  • Coverage included with your travel insurance 

All-perils coverage will cover the cost of a rental if your car is stolen, while collision coverage will not.

FSCO defines it as coverage that “provides you with a replacement vehicle or reimburses you for your transportation costs, while your vehicle is being repaired or replaced after being damaged by an insured peril.” In other words, a Loss of Use policy covers your cost of transportation while you wait for your collision-related car repairs to be completed. This is why your insurance after an accident is so important! It applies whether you choose to rent a car, take public transit or call a cab. Therefore, if you have OPCF 20, you can get a rental. A quick call to your insurer or isure broker can confirm this.

The OPCF 20 will provide a rental car if yours is in the shop for repairs as a result of collision or vandalism. 

OPCF 20: Loss of Use endorsement

Canadian drivers are not required to purchase additional insurance from the rental car company when renting a car. However, you do need to have ample coverage that will cover you in case of collision-related car repairs. If you have Loss of Use coverage (OPCF 20), your rental car will be covered by your policy. You can keep it until your car repairs are complete or until your coverage limit is reached—whichever comes first. OPCF 20 is an endorsement you can add to your current policy, meaning it does not come as standard.

How long does Loss of Use coverage last?

Loss of Use coverage applies from the time of your claim until:

  • Your vehicle repairs are complete
  • You’re offered a total loss settlement
  • You reach the limit of your coverage—whichever happens first

In reference to the above, different limits are available for this coverage. However, $1,500 is usually a standard amount. You can request higher limits from your isure broker, if necessary.

Are there any limitations to coverage?

There are a few limitations with a Loss of Use coverage endorsement:

  • Your replacement vehicle will need to be similar in size to your damaged vehicle.
  • Most rental car companies will not be able to rent to you if you are under 21 years of age. However, coverage can still compensate for the cost of cab fare or public transit.
  • Gas and additional costs associated with the rental are usually not covered by Loss of Use coverage

Accidents happen, and the wait times for collision-related car repairs keeps increasing. If your car needs a week in the repair shop, having Loss of Use coverage on your policy can help. By reducing your expenses, you can worry less about covering the cost of a rental car. However, not everyone needs Loss of Use coverage. Speak with our isure representatives for more details on this type of coverage and if it is the right fit for you.

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