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Since 2019, catalytic converter thefts have skyrocketed to record highs. However, new state legislation and a decline in the price of precious metals have slowly reduced the number of overall thefts. According to a report by BeenVerified, approximately 26,742 catalytic converters were stolen nationwide during the first six months of 2023, representing a 43% decrease from the same period last year. Despite this downward trend, catalytic converter thefts remain significantly higher than in 2019, which saw only 3,389 thefts nationwide. 

Let’s take a closer look at the data to help you better understand the situation and how you can prevent yourself from being a victim of converter theft.

Key Takeaways: 

• There were approximately 26,742 catalytic converter thefts during the first six months of 2023, representing a 43% decrease from the same period in 2022.
• California, Texas, New York, and Illinois lead the nation in total catalytic converter thefts so far this year, with 6,988, 2,235, 2,071, and 1,354 thefts, respectively.
• The average cost of rhodium, the most expensive metal found inside most catalytic converters, is around $131/gram. In 2021, rhodium hit an all-time high of $958/gram.

Total Catalytic Converter Thefts by State During First Half of 2023

Although catalytic converter thefts are down compared to 2022, thefts are still significantly higher than in 2019, according to the BeenVerified report. Here’s a rundown of how many catalytic converters were stolen by state during the first six months of 2023 using data from the NICB and BeenVerified.

*Number of thefts during the first six months of 2023 according to BeenVerified and the NICB data.

Of all 50 states, California, Texas, and New York have experienced the most catalytic converter thefts this year, with 6,988, 2,235, and 2,071 total thefts, respectively. When comparing thefts per 100,000 registered vehicles in each state, New York came in first place with 11.14 thefts, followed by New Jersey with 9.29 and Delaware with 8.81, according to BeenVerified.

Which Car Models Are More Prone to Converter Theft? 

Although every gas-powered car since 1974 is required to have catalytic converters, not all models are targeted the same. Unfortunately for some, a few vehicle types routinely experience greater thefts than others. According to CarFax, these were the top cars targeted for catalytic converter theft in 2022:

Why Do Thieves Routinely Target Catalytic Converters? 

Since 2019, catalytic converters have been a popular target for thieves hoping to cash in on the precious metals located inside the car part. A typical catalytic converter will contain varying amounts of platinum, palladium, and rhodium.

Out of all three metals, rhodium is the most expensive. However, the price of these metals has dropped significantly throughout the last few years, which is a potential reason for the decrease in thefts. For example, at the time of this writing, rhodium is worth around $131/gram. In 2021, the metal hit a record all-time high of $958/gram. There are typically 1-2 grams of rhodium alone inside a catalytic converter.

A converter’s location on a vehicle also makes it an easy target. Since it is located on the back underside of the vehicle, it only takes a minute or two and a reciprocating saw to extract the converter from the exhaust pipe. This is why vehicles with higher ground clearance are routinely victims of theft.

How Have States Responded to Catalytic Converter Thefts? 

To combat thefts, multiple states have passed legislation that seeks to prevent thefts with increased penalties. Here’s a quick rundown of legislation passed in states with some of the highest reported thefts in the country:

• California – The Golden State passed multiple bills in 2022 that address catalytic converter thefts. For example, SB 1087 limits who can legally sell a catalytic converter, while AB 1750 requires metal recyclers to maintain stricter documentation of when and where they purchased used converters.
• Texas – In Texas, Gov. Abbott has recently signed a bill into law known as the Deputy Darren Almendarez Act, which creates new criminal penalties for thefts and allows prosecutors to treat thefts as organized crime. The bill is named after a deputy who lost their life attempting to stop a converter theft.
• New Jersey – New Jersey has followed similar steps as California with S249/A2210 by increasing the documentation metal recyclers must adhere to when purchasing used converters.

What You Can Do to Help Prevent Catalytic Converter Theft

According to the NICB, making it difficult for thieves to access your vehicle’s catalytic converter is the best way to prevent theft. Here are a few tips to follow:

• Install an anti-theft device – Some auto shops have begun installing steel plates or cages around catalytic converts, significantly increasing the work required to steal them. Additionally, vibration-sensitive car alarms can cause a potential thief to think twice.
• Park strategically – It is wise to park your car inside a garage or secured lot whenever possible. If you have a driveway, consider backing into your space so your car’s backend isn’t towards the street. Motion-activated lights can also scare a thief from initiating the crime.
• Vin Etching – Keep an eye out for local law enforcement or city-sponsored events that provide free VIN etching onto your catalytic converter. Etching your car’s VIN onto your catalytic converter can make it easier to trace a loose converter back to your car. Additionally, thanks to new legislation in some states, thieves cannot sell an etched converter that they cannot prove came from their own vehicle.   

Keep Yourself Protected with Comprehensive Insurance 

If your catalytic converter is stolen, you’ll need comprehensive insurance to file a claim for a replacement. Comprehensive coverage isn’t legally required in any state, but your lender may require it if you lease or finance a car. If you’re searching for comprehensive coverage, our insurance specialists can help. With AIS, you can compare rates from our network of trusted insurance partners. Call us today at (888) 772-4247, or start a quote online to get started. 

The information in this article is obtained from various sources and is offered for educational purposes. Furthermore, it should not replace manuals or instructions provided by the manufacturer or the advice of a qualified professional. No warranty or appropriateness for a specific purpose is expressed or implied.

Inventory shrinkage is a major growing problem, costing businesses billions of dollars annually. It can be especially devastating for retailers, who often operate on tight margins, as even a small amount of shrinkage can significantly impact profits. In this article, we will discuss what inventory shrinkage is, how to reduce it, and which insurance policies can help you financially recover from theft so you can focus on running your business.

What is Shrinkage?

Shrinkage is the loss of physical inventory caused by a variety of factors, such as employee theft, shoplifting, administrative and operational error, and damaged or expired goods. It is the difference between your actual inventory and the amount your records say you should have. For example, a retailer with $1 million in recorded inventory may find they only have $750,000 in actual inventory after a physical count. This indicates the retailer has experienced $250,000 in shrinkage. According to the National Retail Federation (NRF), inventory shrinkage costs the retail industry an estimated $94.5 billion in 2021. However, the good news is you can reduce inventory shrinkage by putting a few simple processes in place.

6 Ways to Reduce Inventory Shrinkage

While it is impossible to eliminate inventory shrinkage entirely, there are several steps businesses can take to reduce it.

1. Train Your Employees

Employee theft is a major cause of inventory shrinkage, accounting for 42% of all losses. You can significantly reduce inventory shrinkage and protect your profits by training your employees on proper inventory management procedures, creating a culture of honesty and accountability, and theft prevention techniques.

2. Conduct Periodic Inventory Check

Periodic inventory checks are essential for preventing shrinkage because they allow you to identify potential losses and address discrepancies before they become too costly. A good rule of thumb is to conduct a full inventory check at least once a quarter and more frequently for high-value items.

3. Use Technology to Prevent Shrinkage

A variety of technologies are available to help businesses prevent theft and loss, including:

• Security tags -These tags deter theft by triggering alarms if the product is removed from the store without being paid for.
• RFID tags – Radio frequency identification tags track the movement of products throughout your warehouse, store, or supply chain and identify stolen products.
• SKU and barcodes – Stock keeping units (SKUs) and barcodes help automate inventory management and track the movement of products within the warehouse or store.

4. Implement Inventory Automation

Automated inventory management software helps businesses track their inventory levels in real-time and identify potential theft or losses more quickly. Additionally, this type of software can help to reduce manual labor, human error, and make it easier to identify missing items.

5. Set Up a Loss Prevention Plan

A loss prevention plan is a comprehensive document that outlines the steps your business will take to prevent theft and reduce shrinkage. It should include specific security procedures, inventory management, employee training, and so forth. It’s important to communicate this plan to all employees and ensure they understand their role in preventing theft and reducing shrinkage. As your business grows or changes, your loss prevention plan should also be updated to reflect those changes.

6. Optimize Your Warehouse and Store Security

One of the most effective ways to prevent inventory shrinkage is to improve security in your warehouse and store. CCTV cameras can help deter theft and protect your inventory, but there are other important security measures to consider, such as:

• Access control systems – These systems can restrict who has access to your warehouse and store and when they can enter and exit.
• Security guards – Security guards can provide a visible presence and deter theft, especially during off-hours.
• Intrusion detection systems – These systems can detect unauthorized entry into your warehouse or store and alert you of a break-in.
• Motion sensor lighting – Well-lit areas make it more difficult for thieves to operate undetected.

How to Calculate Inventory Shrinkage

Retail shrinkage is the discrepancy between recorded inventory and actual inventory. To calculate shrinkage, we use the following formula:

To better understand how much money a retailer loses to shrinkage, we can calculate the shrinkage rate as a percentage of total sales. A higher shrinkage rate means that the retailer is losing more money to shrinkage. The shrinkage rate is calculated using the following formula:

So, what is an acceptable inventory shrinkage rate? As stated before, the retail industry’s average shrink rate was 1.44% in 2021 which resulted in over $94 billion lost. In other words, an acceptable inventory shrinkage rate should be as small as possible.

What Type of Business Insurance Covers Theft?

In addition to improving your security and taking steps to prevent theft and reduce shrinkage, buying the right business insurance is key. However, it’s important to note that these insurance policies do not cover shrinkage since it is a normal part of doing business, and it is difficult to identify the source of the loss.

1. Commercial Crime Insurance

Also known as business crime insurance or fidelity insurance, protects businesses from financial losses caused by criminal acts such as theft, embezzlement, forgery, fraud, and cybercrime. It can cover cash, assets, merchandise, or other business property losses. This type of policy can be purchased as a standalone policy or added as part of a business owner’s policy (BOP).

2. Inland Marine Insurance

Inland marine insurance reimburses the cost related to equipment loss, theft, or damage while it is in transit or temporarily stored off-premises. It includes coverage for a business’s inventory, equipment, furniture, and documents. While standard business policies offer coverage up to $10,000, inland marine insurance significantly widens the scope of protection, providing more comprehensive coverage.

3. Commercial Property Insurance

Commercial property insurance covers damage or loss of your business property, including your building, inventory, and equipment. It typically covers theft, such as burglary, robbery, shoplifting, and employee theft.

Is Looting Covered by Business Insurance?

Looting is typically covered by commercial property insurance as it provides coverage for your building and all its content against vandalism, theft, fire, and explosions. However, it’s important to note that specific coverage varies from policy to policy. For example, some business insurance policies may have exclusions for looting that occurs during civil unrest or natural disasters. Be sure to carefully review your policy to understand what types of losses are covered and what exclusions may apply.

Get a Quote from AIS Insurance

Our dedicated commercial insurance team can help you compare insurance options, limits, and deductibles. We make it a priority to understand your business. Speak with one of our Commercial Insurance Specialists today at (855) 919-4247 for a quick and easy free quote.

The information in this article is obtained from various sources and offered for educational purposes only. Furthermore, it should not replace the advice of a qualified professional. The definitions, terms, and coverage in a given policy may differ from those suggested here. No warranty or appropriateness for a specific purpose is expressed or implied.

Walking out to an empty space where you parked your car is a situation we hope to never find ourselves in. After ensuring that you’re in the right place and that you didn’t park where you shouldn’t have, reality quickly sets in: your car was stolen. Now what?

According to the National Insurance Crime Bureau (NICB), over 1 million vehicles were stolen in 2022, representing a 7% increase over 2021. If you find yourself a victim of auto theft, the first thing to do is try to remain calm. Although a stolen car is a stressful situation, understanding what steps to take will help you retrieve or replace your vehicle as soon as possible. Here’s what to do if your car has been stolen or vandalized.

Key Takeaways: 

• Report a stolen car to local law enforcement as soon as possible. According to the NICB, 45% of stolen vehicles are found within two days.
• You’ll need comprehensive coverage in order for your insurer to cover the repair or replacement costs of a stolen car.
• You can use your renters or homeowners insurance to cover personal items that were inside your car at the time of theft.

Essential Steps to Take If Your Car Is Stolen 

1. Contact Law Enforcement 

It’s important that you report a stolen car to local law enforcement as soon as possible. Although there is no guarantee that notifying the police will get your car back, the sooner you report the crime, the sooner it can be recovered. According to the NICB, 34% of stolen vehicles are recovered on the same day as the theft, and 45% are recovered within the first two days. Additionally, you’ll likely need to have a police report filed for your insurer to honor an auto theft claim.

You should still immediately contact the police even if your car was broken into but wasn’t stolen. Having a police report on file establishes a clear timeline of when and where a crime took place, which will be helpful during the claims process. 

To report a vehicle stolen, law enforcement will typically need to know the following information:

• Your vehicle’s make, model, and color
• License plate number and VIN
• When and where you last parked your car
• Information on your car’s GPS tracking system, if applicable
• Your contact details

2. Call Your Insurance Provider 

After contacting and filing a report with the police, your next step should be calling your insurance provider. In some cases, you may only be able to file a claim with your insurer for a stolen car once you have a police report. Additionally, keep in mind that not all policies cover stolen vehicles. 

You will need comprehensive insurance to cover the cost of a stolen vehicle’s replacement (up to your policy’s limits). If you only carry your state’s minimum required coverage, your insurer won’t cover replacement costs. Even if you don’t have comprehensive insurance, it is still wise to contact your insurance company so that you won’t be liable for damage the thief causes with your car.

3. Take Pictures and Make a List

After making all necessary phone calls, document the scene of the crime. Police reports are great for setting a timeline, but you’ll want to have as much evidence as possible. For example, there could be leftover signs indicating how your car was stolen, such as broken glass. If your car was vandalized, your insurer will want to see any photos you take of the damage, so be as thorough as possible.

Although comprehensive insurance will cover replacement costs up to your policy’s limits, it won’t cover personal items in the vehicle at the time of theft. Suppose your laptop was inside your stolen car. In that case, you can file a claim through your renters or homeowners insurance to replace stolen items.

4. Contact Your Lender 

If you are financing or leasing your car, don’t forget to inform your lender about the theft. Since lenders have a legal claim to the vehicle, they can work with the insurance company directly, which can help speed up the claims process.

Unfortunately, are still responsible for your car’s payments even if it is stolen. That’s why lenders typically require you to carry comprehensive coverage when leasing or financing a vehicle.

What If My Stolen Car Is Found?

Hooray, your car was found! In most cases, law enforcement will typically impound your vehicle when it is located and contact you so that you can pick it up. Once notified that your car has been found, contact your insurance company right away. If your claim has already been settled, your insurance company owns the car. However, if the claim has yet to settle, your insurer will want you to inspect the vehicle to repair any damages that may have occurred.

What If My Car Isn’t Recovered? 

Although reporting your car stolen will increase the likelihood of it being found, it isn’t a guarantee that it will. So, what happens if a stolen car isn’t recovered?

After filing a claim using your comprehensive coverage, you’ll receive a payout equal to your vehicle’s actual cash value (ACV) at the time of theft, up to your policy’s limits and minus your plan’s deductible. For example, if your car is worth $20,000 at the time of theft and you have a $1,000 deductible, you’ll receive a payout of $19,000.

The Top 10 Most Stolen Cars Nationwide

Although any car can be susceptible to auto theft, thieves tend to target some models more than others. According to the NICB, here are the top 10 most stolen cars nationwide.

Speak With an Insurance Specialist Today

If your car is stolen, having the right amount of coverage will keep you financially protected. Although comprehensive insurance costs more than standard liability coverage, the coverage could help you avoid a hefty out-of-pocket bill after a covered incident. If you aren’t sure of which auto insurance coverages work best for you, AIS can help. Our insurance specialists can guide you along your search and know the questions to ask to help build your ideal policy. Plus, we’ll use our network of trusted insurance partners to find you auto quotes that align with your budget. Contact us today by calling (888) 772-4247, or starting a quote online.

The information in this article is obtained from various sources and offered for educational purposes only. Furthermore, it should not replace the advice of a qualified professional. The definitions, terms, and coverage in a given policy may be different than those suggested here. No warranty or appropriateness for a specific purpose is expressed or implied.