Insurers oppose European standard on immobilizers

By Carine Sroujian | August 20 2003 03:52PM

To stem the tide of rising auto theft, Transport Canada has just proposed to amend the Motor Vehicle Safety Act requiring all cars built after September 1, 2005 to be equipped with immobilizers meeting one of two acceptable standards: the IBC’s Canadian standard (ULC-S338), or the European standard (ECE 97).

The Insurance Bureau of Canada (IBC) is currently lobbying against Transport Canada's endorsement of the European standard, saying it is less effective and could undermine the whole system.

Henning Norup, Vice-President of Information, Research and Analysis for the IBC, explains that the ECE standard is inferior and is not as stringent as the Canadian standard.

Barry Ward, Auto Crime Project Manager at Manitoba Public Insurance (MPI) and Executive Director for the National Committee to Reduce Auto Theft, agrees. He says the Canadian standard prohibits three components from functioning: the electrical, the starter, the ignition and/or the ignition system. The European ECE 97 does not stop all three.

"The Canadian standard also requires that it be installed by a licensed mechanic whereas the ECE 97 does not," says Mr. Ward.

In 1998, the Vehicle Information Centre of Canada (VICC), a division of the IBC, established the Canadian, ULC-S338 standard. Since then, many manufacturers have adopted it, states Costa Kaskavaltzis, Manager of Automotive Engineering and Vehicle Services at the IBC.

The Canadian standard applies to original equipment manufacturers (OEM) as well as aftermarket manufacturers. Mr. Kaskavaltzis adds that 11 of the most important vehicle manufacturers in Canada install, in at least one model, an anti-theft system respecting the Canadian standard. These 11 companies manufacture 90% of light vehicles sold in Canada.

Discount mayhem

The Co-operators supports the IBC and its initiatives to install immobilizers. David Campbell, National Auto Physical Damage Claims Manager for the Co-operators, asserts that if one immobilizer is not up to par, it would be confusing for the industry when it comes to awarding discounts. "What do I do with that group who has a lower standard? Lower the premiums, but not as much? Do I not offer them a discount at all? It's simple when you have one standard because then you can compare them to the unprotected group."

Mr. Norup says that it is unlikely the insurance industry will even consider the lower standard and offer discounts because it will create too much confusion. "We will continue to insist on the Canadian standard ... offering [insurance] discounts on the Canadian standard [only]."

Mr. Kaskavaltzis says it is more logical if cars are required to be equipped with devices meeting the Canadian standard. "But, we still have issues around the way this requirement would be enforced; in other words, accountability at the vehicle manufacturer level."

He explains that the IBC has seen situations where manufacturers self-declare compliance to ULC-S338 to later discover that the system is not compliant. "So far, we've been able to deal with the manufacturer directly in situations like that. With Transport Canada, that clouds the issue."

Talking to Transport

The IBC has been talking to Transport Canada about immobilizers for at least two years. Mr. Kaskavaltzis says that the IBC has warned it that regulatory change would interfere with the progress of putting immobilizers in new cars.

"It's causing those vehicle manufacturers, who have voluntarily adopted the IBC standard, to freeze any forward advances in equipping more vehicles because they're taking this wait-and-see attitude."

Dan Kingsbury, a spokesperson for Transport Canada, explains that many non-North American manufacturers are already complying with the European standard. "Because they're both equally effective, we're giving them the choice," he adds. As of press time, interested stakeholders, including the vehicle manufacturers and the insurance industry, have 75 days to comment and to present their opinion.