Collision repair times are now averaging about 15 days in Canada, putting renewed attention on rental reimbursement coverage and how insurers support customers while their vehicles are in the bodyshop.
A new Enterprise Mobility report says Canadian drivers are waiting an average of 15 days for collision-related repairs based on the company’s Length of Rental (LOR) data. That means many motorists are without their vehicles for more than two weeks following a crash.
Jennifer Everett, vice-president, replacement and leisure division, at Enterprise Mobility, told Collision Repair rental reimbursement coverage is becoming more important as repair timelines stretch.
“Rental reimbursement should no longer be considered merely supplementary. With the potential to positively impact customer satisfaction and retention, these policies can represent a strategic advantage for insurers willing to prioritize them in initial policy discussions and throughout the client relationship.”
The Canadian auto insurance market is estimated at $25 billion and expected to grow at a 4.4% compound annual rate through 2033. At the same time, claims costs continue to rise because of inflation, higher repair charges and increased vehicle theft, pushing average auto insurance rates up more than 12% between the third quarter of 2023 and the same period in 2024.
Everett says longer repair timelines are being driven by several factors across the industry.
“There are many factors that influence length of rental, including repair complexity and severity, claims-handling processes, parts availability and repairer backlogs. Experts from the insurance, collision and parts industries are best equipped to speak to the specific factors affecting cycle time, but all of these elements contribute to longer repair duration.”
Enterprise’s research also highlights a gap between how many drivers have rental reimbursement coverage and how many still need a replacement vehicle during a claim.
The study found that 53% of customers with comprehensive auto insurance policies have rental reimbursement coverage. However, 44% of customers without the coverage still rented a vehicle during a recent claim.
For those who do have the coverage, satisfaction with the claims process tends to be higher. The report says 93% of policyholders who used rental benefits during a claim say they would likely rent again during a future claim.
But the level of coverage matters. Everett says customers quickly become frustrated if they end up paying large portions of the rental cost themselves.
“Customers without rental reimbursement coverage — also commonly referred to as loss of use coverage — do still often rent a vehicle during a claim, and our data shows that coverage and clarity around limits are key drivers of satisfaction.
“Customers with rental reimbursement coverage tend to be more satisfied overall and have longer tenures with their insurance provider. However, satisfaction decreases as out-of-pocket costs increase. Policyholders who end up paying half the cost of their rental, or more, are actually less satisfied than those who had no coverage at all.”
In fact, 54% of customers with rental reimbursement coverage who rented during an accident claim still paid something out of pocket because their daily coverage limits did not fully cover the rental cost.
“When a customer has rental reimbursement coverage, they expect that coverage to support them throughout the repair. With repairs now taking more than two weeks on average, customers want to be in a vehicle that helps them maintain their lifestyle during that time.”
The report also suggests many drivers simply are not aware the coverage exists. About 21% of customers without rental reimbursement say they have never heard of it or believe their insurer does not offer it.
Everett says clearer communication before a claim happens can make a difference.
“The challenge is that many customers are simply not aware of the limits of their policy. Agents play an important role in helping them understand what their coverage includes before a claim occurs.”
Enterprise also points to technology tools designed to keep insurers, bodyshops and rental providers aligned while repairs are underway.
“Enterprise is committed to working collaboratively with insurance and collision partners. One way we do this is through technology solutions that streamline the rental and claims processes.”
The company’s Automated Rental Management System, or ARMS, tracks how long replacement vehicles are rented and allows repair facilities to update insurers and Enterprise branches on repair status. The company says the data can help collision centres benchmark repair cycle times across markets.
As repair timelines stretch and transportation needs remain constant, Everett says the role of rental reimbursement coverage in the claims experience is becoming harder to ignore.
