Action taken to protect safety and financial security of consumers
Hamilton, ON (July 23, 2014) – Economical Insurance has taken the extraordinary step of destroying two stolen vehicles that were recovered from individuals with links to organized crime. A 2005 Cadillac Escalade and a 2005 GMC Denali were crushed at Bodyline Auto Recyclers in Hamilton, Ontario to prevent them from being sold to unsuspecting consumers.
The vehicles were stolen from Economical policyholders, and reported as stolen in early 2009. Economical promptly adjusted our policyholders’ claims and paid out more than $56,000 to the policyholders for their losses. After the claims were paid, the registrations of these vehicles were transferred to Economical Insurance.
In March 2010, Economical was notified by police that the Escalade had been found and recovered during a police investigation concerning vehicle fraud by organized crime. Shortly after, police also recovered the Denali during the same investigation once they ascertained that it was also registered to Economical.
Since the recovery of the two vehicles, individuals who were convicted of the vehicle fraud contested the ownership of the vehicles in court. They lost.
Normally when stolen vehicles are recovered, automobile salvers purchase the vehicles from Economical and sell them whole or in parts.
“In these two cases, the Denali and the Escalade are not the same vehicles our policyholders once owned,” said Javier Ibanez, vice-president of national sales and distribution for Economical Insurance. “Parts from other vehicles � salvage or otherwise � were put on these vehicles by individuals who were convicted as part of the February 2010 arrests.”
According to police reports, the criminals were fitting the Denali and the Escalade with stolen or improper Vehicle Identification Numbers (VINs) in preparation for sale.
“As one of Canada’s leading insurance companies, we simply cannot be assured of the safety of the vehicles or the integrity of the parts. These vehicles have multiple VINs. By crushing these vehicles today, we are preventing them from being sold whole or in parts to an unsuspecting public.”
Consumers may face financial risk if they purchased these vehicles. For example, upon taking the vehicle in for servicing, the service vendor may report the VIN situation to local police after which the vehicles may be seized, leaving the purchasers to suffer a financial loss.
“From a safety point of view, we don’t know if the airbags were tampered with or even if they are still in the vehicle,” added Ibanez. “In the event of a collision, the driver’s safety would be ultimately in peril. For these reasons, we have destroyed the vehicles in the interest of consumer protection.”
Photo Credit: Economical Insurance
About Economical Insurance
Founded in 1871, Economical Insurance is one of Canada’s leading property and casualty insurers, with $1.9 billion in annual premium volume and $5.0 billion in assets as at March 31, 2014. Based in Waterloo, this Canadian-owned and operated group services the insurance needs of more than one million customers across the country. In 2010, Economical announced its decision to become the first federally-regulated mutual property and casualty insurance company to pursue demutualization. Economical Insurance conducts business under the following brands: Economical Insurance, Economical, Western General, Economical Select, Perth Insurance, Family Insurance Solutions, Federation Insurance and Economical Financial.
SOURCE: Economical Insurance