Keith Vodden Dr. Douglas Smith - Transports Canada

Analysis and Estimation of the Social Cost of Motor Vehicle Collisions in Ontario
wait times. A useful rule of thumb is $0.30 to $0.32 per pound of vehicle towed. So an
average automobile of 1,500 lbs is $450 to $500 and a large truck is $15,000 to $30,000.
Since large trucks make up only 2% (17,849 of 853,902) of vehicles involved in
collision in 2004 and commercial vehicles are more likely to be self insured (not covered
by insurance claims, we make the simplifying assumption that most vehicles requiring
tows will be automobiles or light trucks with an average tow charge of $500 in 2004.
Based on these costs per tow and the number of tow truck services presented
earlier we estimate the social costs of tow truck services in 2004 at $95.6 million.
8. Property damage and other losses generally covered through
insurance
Property damage caused by motor vehicle collisions is generally covered through
the insurance claims of involved parties. In addition, claims cover a number of other
incurred losses due to the collision such as tow trucks, damaged vehicle storage, car
rental, or hotel accommodation. We include these losses (other than tow truck services
discussed earlier) attributable to the motor vehicle collision in our estimate of property
damage and other losses generally paid for through insurance claims. We also include the
claims and adjustment expenses incurred by insurance companies and recorded in the
data available to us from the Insurance Bureau of Canada (IBC). As a final note on
coverage, we do not estimate property damages that would be borne by the “at-fault”
driver as the deductible not reimbursed under collision and all perils claims. This
deductible not included in the claims payouts is included in out-of-pocket expenses
discussed in another section.
Property damage and the other losses discussed earlier are covered under the third
party liability, collision and all perils insurance coverage of insured parties 1 . In addition a
special insurance fund covers claims against uninsured (or unidentified) automobiles and
under-insured drivers. However, claims within some of these categories may also include
other items not relevant to our estimate of the social cost of motor vehicle collisions. For
example:
• Third party liability includes claims for bodily injury.
• All perils include comprehensive coverage (fire, theft).
• Uninsured automobiles include claims for bodily injury and death.
In addition, some vehicle owners self-insure (do not have coverage for collision
damage to their vehicle if they are found to be “at fault”). We include the proportion of
commercial vehicles that self-insure based on the proportion without some form of
collision coverage beyond mandated third party liability in our analysis. (Loses to private
1 We include coverage of private passenger vehicles and motorcycles, commercial vehicles, farmers, snow
machines, buses, ambulances, interurban trucks, trucks for hire, taxicabs, miscellaneous public
automobiles (rental cars), and other types of specialty vehicles.
36 TNS Canadian Facts, Social and Policy Research