Canadian Underwriter

Paid More Information, Better Decisions for Insurers

October 20, 2020   by karen

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Did you know that in the U.S., 130 of the top 150 insurance carriers use CARFAX vehicle history data to improve underwriting and boost claims efficiency? In fact, CARFAX vehicle history data has proven to be highly correlated with loss ratios. Here are some of the most valuable data points for insurers:

Odometer readings

Based on CARFAX Canada analysis, it’s estimated that there are more than 192,000 vehicles on the road in Canada that have odometers that have been tampered with.

Odometer readings from service records are the best source of accurate odometer information because the readings are not self-reported (unlike provincial registration records).  CARFAX Canada has added over 30 million new service records so far this year1, helping our customers to extrapolate mileage information and identify potential odometer problems.

History of severe problems

Based on research conducted by CARFAX U.S., vehicles that have a history of severe problems are more likely to have more future accidents and cost more to repair.

CARFAX Canada’s vehicle history data can flag many severe problems including a stolen vehicle check (for vehicles that are actively reported as stolen), negative or title branding (Salvage, Rebuilt, Junk, Frame Damage, Fire, Flood, etc.), and accumulated accident damage over specific thresholds – all with associated dates.

History of minor damage

CARFAX U.S. research has also shown that vehicles with minor damage end up having higher losses than vehicles that don’t have a similar history. As well, the more minor damage events in a vehicle’s history, the worse its loss performance. In fact, vehicles with more than five minor damage events have losses similar to those with major damage in their history.

In addition to flagging severe problems, vehicle history information from CARFAX Canada can also provide visibility into minor accident and damage events such as hail damage and vandalism.

Ownership history

Knowing the history of ownership is a very powerful predictor of future losses. CARFAX U.S. studies have shown that the longer a vehicle is owned by a single owner, the less it costs to provide coverage for that vehicle. On the flip side, vehicles that have had multiple owners have a higher chance of not being properly maintained at some point in their lifecycle, and as a result, they have more losses and attract lower valuations (which is particularly important in total loss compensation).

Ownership types, multiple current registrations and service record location

Garage flipping and misrepresentation of ownership type/vehicle are just two types of insurance fraud that are increasingly common. CARFAX Canada vehicle history data such as vehicle decode, service records and locations, ownership type, and potential VIN cloning can be used to help identify these types of fraud.


With so much information available, it’s imperative to understand which data points are most relevant for your business, and to have that data at your fingertips. CARFAX Canada vehicle history information can be customized to suit various business functions, and the delivery format can be tailored to suit your needs, including APIs and user portals.

For more information, or to request a no-cost data evaluation, visit


The information in this article is based on the experience of the CARFAX Banking & Insurance Group in the U.S. CARFAX Canada is pleased to be able to offer similar vehicle history services to insurance companies here in Canada.

1 CARFAX Canada Data, Oct. 2021