Most cars today are equipped with at least one anti-theft device, but car theft is increasing.

Does car insurance cover theft

In 2021, 932,329 vehicles were reported stolen, a 6% increase from 2020 and a 17% increase over 2019, according to a September 2022 report from the National Insurance Crime Bureau.

The most stolen vehicles are Chevrolet and Ford pick-ups followed by Honda Civics and Honda Accords, according to NICB numbers released in July 2022.

Having your car stolen can be incredibly scary, but fortunately, in many cases your car insurance will cover it. Full coverage car insurance policies, for instance, include theft coverage, as well as coverage for vandalism and physical damage.

In the following sections, we’ll go over the types of car insurance that cover theft, how to file a theft claim, and how much money you can expect to get from your insurance company.

Key Highlights
  • Comprehensive car insurance is the only standard car insurance policy that will cover your vehicle if it gets stolen.
  • Some endorsements, like gap insurance and new car replacement, can also come in handy in the event of theft.
  • Stolen personal items aren’t covered by auto insurance, but they may be covered by renters or home insurance.
  • If your car is stolen, you will likely be paid based on the ACV of your vehicle, minus your comprehensive coverage deductible.

Types of car insurance that cover theft

If you were wondering, “does insurance cover stolen cars,” the answer is yes. However, it depends on the kind of policy you have.

In most cases, a full coverage car insurance policy will offer protection in the event of theft. But if you have a minimum coverage policy with liability coverage only, you’re probably out of luck.

Here are a few types of car insurance that will cover your vehicle if it gets stolen.

Comprehensive insurance

The only standard type of car insurance that covers vehicle theft is comprehensive insurance, which you get with a full coverage policy. Full coverage car insurance also includes collision, liability, and medical payments coverage.

Comprehensive insurance covers non-collision claims such as theft or fire, as well hitting an animal or suffering a hit from a fallen tree during a storm.

Gap insurance

If you lease or finance your vehicle, gap insurance can come in handy. This endorsement helps pay the difference between your car’s value and your remaining loan balance if the vehicle is totaled or stolen. Usually, you need to have a full coverage policy to get gap insurance.

However, keep in mind that gap insurance won’t pay for a new car. It will only help you repay your outstanding loan balance if your car gets stolen.

New car replacement insurance

New car replacement is another optional policy that many auto insurance carriers sell. If your car gets stolen or totaled, this policy gives you money to replace your vehicle with one of a similar make and model, and your payout does not include depreciation.

The downside to new car replacement is that there can be eligibility requirements. For example, some insurers only offer this to drivers who are the first owner of their vehicle or have a one or two-year-old car.

Are stolen personal items covered?

When it comes to car theft, it’s a misconception that your auto policy will pay to replace personal items in the car when it was stolen.

The truth is, there are no car insurance policies that will cover stolen personal items unless your carrier offers a special endorsement. In this case, you could file a claim through your renters or homeowners insurance policy to cover your stolen belongings.

How to file a theft claim?

Stolen car insurance claims work similarly to regular accident or physical damage claims. The biggest difference is that a stolen car claim might require additional documentation.

First, you should call your insurance company as soon as possible after you realize that your car has been stolen and you have notified the police. The agent or claim representative will walk you through the process and tell you what information you’ll need to share.

Before you file the claim, you should have a copy of the police report handy. The insurance company will want to verify when and where the theft occurred. Keep in mind that if you didn’t call the police after the robbery, your insurance company might deny your car insurance theft claim.

Once you’ve filed the claim, your insurance company might allow you to track the status online or through a mobile app. After the claim has settled, you will receive your payout, which you can use to purchase a new vehicle, similar to the one you had before.

How much will my insurance company pay after a theft claim?

Your payout after a theft claim depends on a few things, like your comprehensive insurance policy limit. It’s the highest amount of money your insurance company will pay after a covered loss.

The maximum comprehensive coverage payout is generally the actual cash value (ACV) of the vehicle minus the deductible.

Insurance companies calculate ACV using the replacement cost value of your car, minus depreciation. It accounts for your vehicle’s mileage, accident history, make, model, year, and overall condition inside and outside. Your deductible is the out-of-pocket cost you’re required to pay towards any physical damage claim.

Lower deductibles result in higher monthly premiums, but you get a larger payout in the event of a claim.

My car was found after the claim was filed — now what?

If you’re one of the lucky few who can recover their car after it gets stolen, it can complicate the claim process. It really depends on whether you’ve received the payout and bought a new vehicle and what condition the car is in when it’s found.

Let’s say your car is recovered, and it’s pretty banged up. In this case, your car insurance company would likely pay for the damages. However, if the repair costs were higher than the car’s ACV, they may declare it a total loss and give you money for a new vehicle.

But if the claim has already settled and you’re driving a brand new car, your insurance company might take ownership of the recovered vehicle. If you received the payout but haven’t purchased a new car, you may be able to simply return the money and continue driving your old car (once it’s fixed).

Typically, this situation is handled on a case-by-case basis with your insurance carrier. When you file a theft claim, it’s a good idea to ask what might happen if your car is recovered. That way, there are no surprises if your car is found.

Frequently asked questions on car theft

Does gap insurance cover stolen cars?

Yes, gap insurance does cover stolen cars. However, the purpose of gap insurance is to help pay off your loan. It won’t provide a separate payout that you can use to replace your car as comprehensive insurance would.

Does theft insurance cover aftermarket parts?

In most cases, auto theft insurance won’t cover aftermarket or custom parts installed in your vehicle. For example, if your car gets stolen a few weeks after you install a new stereo system, it’s unlikely that your insurer would adjust your payout to reflect the recent upgrade.

How can I prevent vehicle theft?

There are many ways to prevent your car from getting stolen: Never leave an unattended vehicle idling, and installing anti-theft devices are just two.

Methodology: 2019 Motor Vehicle Theft Crime Data from the FBI

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Contributing Researcher

Elizabeth Rivelli is a freelance writer who covers insurance. Her areas of expertise are life insurance, car insurance, property insurance and health insurance. Elizabeth has appeared in dozens of online publications, including Investopedia, CNET and Bankrate. She has also written for several insurance companies.