Are Luxury Cars More Expensive to Insure in Canada?

Luxury vehicles deliver performance, comfort, and design that standard cars don’t, and the insurance pricing often reflects that same difference. 

In many cases, luxury car insurance costs end up two to three times higher than what you’d pay for a common vehicle, because the car costs more to replace, costs more to repair, and attracts more theft attention.

At Distinctive Auto Works (DAW), we restore high-end vehicles after collisions, and we see how precision engineering affects every claim and every repair decision. 

The materials, the technology, and the parts standards that make luxury vehicles feel exceptional also shape what insurers expect to pay when something goes wrong.

Why luxury car insurance costs more in Canada

Higher vehicle value raises the baseline

Insurers start with replacement cost. When the vehicle itself is worth more, the insurer’s potential payout is higher, even before you factor in repairs, rentals, and related costs. This is one reason high-end vehicle insurance rates tend to climb as you move up trim levels, engine options, and performance packages.

Repair complexity increases labour hours

Many luxury vehicles use advanced materials and more complex build methods, including aluminum-intensive construction, mixed-material bodies, adhesives, rivets, and high-strength steels that require model-specific repair steps. These repairs take more time, more specialized tools, and more training, which pushes claim costs up over time. Insurers track these claim patterns and price for them.

OEM parts cost more and availability can be tighter

Luxury vehicles often require OEM parts to restore fit, function, and safety performance. Those parts cost more than typical aftermarket equivalents, and supply can be more limited for newer models, rare trims, or performance variants. 

When parts cost rises, claim cost rises, and premiums often follow.

View DAW’s OEM-certified brands and learn why top insurers trust our repairs.

Performance risk is priced into premiums

Insurance for high-performance vehicles often costs more because the risk profile changes when horsepower and acceleration increase. It is not only about speeding, it’s also about the type of driving insurers see in claims data, plus the cost of repairing performance brakes, suspension components, and larger wheels.

Theft risk hits luxury models hard

Auto theft in Canada has been a major issue, and recent reporting highlights increased targeting of luxury vehicles, with some Lexus and Mercedes-Benz models showing high theft frequency in insurer data.

When a model is frequently stolen, insurers face higher comprehensive losses, and that can raise premiums or trigger added requirements like tracking devices.

A quick comparison to make it real

A common sedan with affordable parts and wide repair capacity often sits in a lower insurance band than a luxury sedan with complex materials and higher parts costs. 

For example, BrokerLink lists an annual range of about $1,624 to $2,399 for a Toyota Corolla in Canada.

Luxury vehicles often land in the $3,000 to $5,000 range in broad Canadian estimates, depending on your province, vehicle, and driver profile.

The role of repair costs and OEM certification

Luxury repair costs are not only about cosmetic finish. They are tied to engineering, materials, and safety systems, and those elements influence what insurers pay out after a claim.

Advanced materials increase time and specialization

Aluminum repair often requires dedicated processes and controlled work practices to avoid cross-contamination and to meet manufacturer standards. 

EV structures add another layer, since battery protection zones, cooling systems, and high-voltage safety steps shape what is repairable and how long it takes.

ADAS and sensor systems add cost after many collisions

A bumper tap on an older car might be a quick refinish and reinstall, but on a modern luxury vehicle, that same hit can involve sensor brackets, radar units, cameras, ultrasonic sensors, wiring, and calibration steps after reassembly. 

Calibration and scanning are not “nice to have” steps if you want the system working as designed.

OEM-certified collision repair reduces long-term risk

OEM-certified repairs matter because they align the repair with the manufacturer’s required procedures, which supports safety performance and creates documentation that helps future claims and resale conversations. 

This matters for insurability in a practical way: clean documentation and correct repairs reduce repeat issues, comebacks, and disputes about whether a repair was completed properly.

DAW repairs luxury vehicles with OEM standards and brand-specific processes, and our certifications and equipment are built around restoring factory integrity, not “making it look good enough.” 

Learn more about our OEM programs. 

How insurers calculate luxury car premiums

Insurers price risk using a mix of vehicle factors, driver factors, and location factors. The same model can price differently across Canada because each provincial system and claim environment differs.

Vehicle replacement cost and repair cost patterns

Insurers look at the make, model, year, and expected repair costs, including theft risk and claims history tied to that vehicle type. The Insurance Bureau of Canada explains that your car’s make, model, year, value, and repair costs influence premiums, and the industry also uses rating tools like CLEAR (Canadian Loss Experience Automobile Rating) as one input among several.

Location and claims environment

Where you live affects costs because claim frequency, theft rates, and repair costs vary by region. Government and insurer reporting also points to Ontario and Alberta as having the highest average premiums in Canada in recent data.

Driver profile and usage

Insurers also price factors like driving record, annual mileage, and how you use the vehicle, along with coverage choices and deductibles. 

Your province matters 

If you’re comparing luxury car quotes, don’t rely on a friend’s number from another province. A province change can shift your baseline before the insurer even considers the vehicle, and recent data shows sizable differences in average premiums by province.

If you are in B.C., also note that ICBC flags high-value vehicles with specific requirements and premiums for certain models.

Let our certified team review your repair estimate and help protect your vehicle’s value.

Real-world examples of insurance differences

Rates depend on your insurer, province, postal code, driving record, and coverage choices, so treat the numbers below as directional examples, not guarantees.

BMW

ThinkInsure reports a 2025 average BMW insurance rate in Canada of $2,574, and notes performance models can be higher.

Mercedes-Benz

ThinkInsure reports an average Mercedes-Benz insurance rate in 2025 of $2,592 per year, with wide variation by city.

Tesla

Rates.ca cites Ontario quote-based averages (from 2021 data) showing higher costs for Model 3, Model Y, and Model X, and ThinkInsure notes Tesla costs often range widely, including higher outcomes in some cases.

What this tells you as a buyer

Luxury insurance is not one uniform “luxury surcharge.” It is tied to model-specific repair costs, theft exposure, and claims patterns, which is why one luxury vehicle can cost far less to insure than another with a similar sticker price.

How to help lower luxury car insurance costs

You will not control every input, but you can influence several of them in a way that insurers will recognize.

Increase your deductible

A higher deductible often lowers premiums because you take on more of the first dollars in a claim. There are a lot of great online resources that detail how deductibles work and why raising them can reduce premium cost.

Bundle policies

Many insurers offer discounts when you bundle auto and home or tenant insurance. Ask your broker to show the price difference with and without bundling.

Add approved anti-theft protection

Because theft is a major cost driver, insurers may reward added protection or require it for certain high-risk vehicles. Recent Canadian reporting shows organized theft has targeted high-value vehicles and some luxury models at higher frequency.
Ask your insurer what devices qualify, since “one size fits all” solutions do not always count for discounts.

Limit annual mileage

Lower mileage reduces exposure. If you work from home or keep a second vehicle, tell your insurer and confirm your usage classification.

Keep clean, consistent repair records

If a collision happens, use an OEM-certified facility and keep your repair file, including OEM parts invoices and calibration proof. This supports consistent records and reduces the risk of unresolved issues that lead to repeat claims.

DAW works with insurers and owners to keep repairs aligned with factory standards, which means proper procedures, proper documentation, and less guesswork after the repair. Learn more about our process and services.

How DAW protects your vehicle’s value and your insurability

A luxury vehicle costs more to own when repairs are done inconsistently, when safety systems are not restored correctly, or when documentation is thin and future appraisals become harder to defend. 

Proper OEM-certified repairs reduce those risks by restoring vehicle integrity, supporting safe system function, and creating a paper trail that helps future resale and future claims.

At DAW, we focus on outcomes that matter long after the car leaves the shop: correct structural repair methods, OEM parts where required, precise refinish work, and documented scanning and calibrations for modern safety systems. 

This approach protects your investment and reduces the odds of repeat issues that create friction with insurers and frustration for owners. 

Find a Distinctive Auto Works location near you and book today. 

If you’re also weighing the ownership side of luxury vehicles, read this article first.

FAQs about insuring luxury vehicles

Does your insurance go up if you have a luxury car?

Often yes, your insurance will go up if you have a luxury car because insurers price higher replacement cost, higher repair costs, and higher theft risk into the premium.

How much more is insurance on a luxury vehicle?

Many Canadian estimates place luxury insurance at roughly two to three times the cost of insuring a common car, though the gap depends on province, model, and driver profile.

Which luxury car is cheaper to insure?

Models with lower repair costs, strong safety performance, and lower theft exposure often price lower within the luxury category, so you need quotes for the exact model and trim you want, not only the brand.

What is the most expensive type of car to insure?

High-value vehicles with high theft risk and high repair complexity, including some high-performance and high-end luxury models, often sit at the top of the premium range.