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Does Car Insurance Cover Theft? It Does, But…

  • Auto Insurance
  • Renee Martin
  • 6 minutes

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Car theft is a serious crime, and it can happen to anyone. While having your car stolen is quite disheartening, your auto insurance should cover it, right? 

Well, the answer is not as simple as you’d think. While car insurance can cover theft, it ultimately depends on the kind of insurance coverage you’ve got. According to a study conducted by the National Insurance Crime Bureau (NICB), auto theft increased significantly in 2020 compared to 2019. The NICB reported 873,080 auto thefts in 2020, a 9.2% jump over the previous year’s total of 799,644 thefts.

Get affordable auto insurance

Since the likelihood of your car being stolen is greater than ever in the last decade, it is important to protect your car at all costs. While there are several ways to keep your car protected from thieves, getting car insurance is probably the best way to safeguard your assets.

Does car insurance cover car theft?

If you want coverage for car theft, you’ll need to supplement your auto insurance policy with comprehensive coverage. Comprehensive car insurance also covers vandalism, fires, floods, hail, falling items, and animal collisions. You probably have car insurance if you’ve financed or leased your car.

What does comprehensive car insurance cover?

If you have comprehensive car insurance and your car is stolen, your insurance policy will help replace your car. You could even receive compensation for parts stolen from your cars, such as a catalytic converter or your wheel rims. However, it does not cover parts that have been added later on, such as an aftermarket sound system.

Comprehensive car insurance will also help you repair any damage caused by an attempted break-in, such as smashed windows and broken door locks. In the event of a claim, you will be asked to pay a deductible before your coverage can kick in. For example, if you have a $1000 deductible and your car is worth $8,000, you would receive a check for $7000.

Unfortunately, comprehensive insurance does not cover personal items stolen from your car. For example, if your phone or laptop is stolen from your car, your comprehensive insurance will not cover the cost of replacing it. However, most renters or homeowners insurance policies cover stolen property.

Rental car expenses are another aspect that comprehensive insurance does not cover. Because you will be without a car until your claim is handled, it may be worthwhile to add rental reimbursement insurance to your auto policy.

How much does comprehensive insurance cost?

According to the most recent data from the National Association of Insurance Commissioners, the average cost of comprehensive insurance is around $160 per year.

What to do if your car is stolen

Finding out your car has gone missing can be a stressful experience. However, being calm will help you figure out what to do next.

Contact the authorities as soon as possible and submit a police report. Make sure to include details such as your car’s year, make, and model, as well as its last known location and VIN (vehicle identification number). Once the authorities have all of the essential information, they will start looking for the stolen car.

Read: How to prevent theft of items from your car?

After you’ve contacted the authorities, you should call your car insurance carrier. Even if your policy does not cover automobile theft, telling your insurer that the car is gone can keep you from being held accountable for any damage caused by the thieves.

It is also recommended that you contact your lender if you financed your vehicle.

How will auto insurance cover you for a stolen car?

Obtaining compensation for a stolen vehicle might be difficult. Many insurers impose a minimum waiting period of 30 days after the theft before processing the claim for the stolen car.

If your car is stolen, you will have to file a total loss claim with your insurance company. This means you’ll work with your insurance company to come up with an amount (without a deductible) that will be paid out to you after the car is determined to be stolen.

Provide any maintenance and repair receipts to receive an appropriate reimbursement amount. This will aid in justifying the upkeep and condition of your vehicle before the theft.

What happens if your car is retrieved following a claim?

If your vehicle is found following a claim, comprehensive coverage will still cover any damages that occurred while it was stolen.

However, when it comes to a total loss claim, things become more complicated. A total loss claim requires you to turn over the title of the missing car to the insurance company. Hence, the car will not be yours when it is recovered.

Read: Essential tips for a pawesome road trip with your pets

If you have not used the settlement sum to purchase a replacement vehicle, it may be as simple as returning the claim amount. Since every circumstance is unique, you’ll have to figure something out with your insurance company.

Consider gap insurance for additional car insurance cover

Your insurance company could remove the amount of depreciation from the compensation you receive for replacing a stolen car. This is known as paying out the actual cash value, or ACV. If you’re concerned about this, especially if you owe money on your car’s lease or loan, it would be a good idea to look into gap insurance.

Gap insurance, which is usually rather inexpensive to add to your policy, will pay the difference between the real cash value of your car and the amount you still owe on it. Car owners do not require gap insurance by law. However, if you owe more on your car than its current worth, or if your car depreciates quickly, gap insurance can be a beneficial form of coverage for you.

Just keep in mind that certain insurance companies have limits on how much they will pay out to cover a “gap.” When purchasing gap insurance, consult with your insurer to ensure that you’re getting coverage that meets your needs.

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Tips to prevent car theft

There are various steps you may take to lessen the likelihood of a thief stealing your car. The National Insurance Crime Bureau (NICB) suggests a multi-pronged approach:

Common sense is the first line of defense. A few easy steps could make it difficult for burglars to steal your car. These include

  • Lock your doors.
  • Remove your keys from the ignition.
  • Keep your windows closed.
  • Park your vehicle in well-lit areas.
  • Use a visible or audible anti-theft device.
  • Lock the steering wheel/brake pedal.
  • Install an immobilizer on your vehicle.
  • Get a pair of smart keys.
  • Buy a tracking system.


Check out our blogs for info on finding top-rated airport parking, the best parking spots in your city, and affordable car washes near you.


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