Does Car Insurance Cover Theft?

When you purchase your auto insurance policy, you can choose to add optional coverages to your policy. Comprehensive coverage is one option, and as long as you have it, your policy should cover vehicle theft.

But if you have a liability-only policy — such as the minimum required by your state — your insurance won’t compensate you for a stolen car.

Here’s what to know about comprehensive coverage, how it works, when you need it, and how to find full-coverage car insurance at a good price.

Comprehensive: Coverage for stolen cars

Comprehensive coverage pays for damage to your vehicle caused by something other than an accident, including inclement weather, falling objects, fire, vandalism, and theft. Comprehensive coverage applies not only to your vehicle but also to individual parts.1

States don’t require drivers to carry comprehensive, and auto insurance policies don’t automatically include it. You have to opt for it as part of a full-coverage policy.

Full-coverage insurance generally includes comprehensive and collision coverage on top of liability insurance. It may also include uninsured motorist coverage, gap insurance, roadside assistance, and more.

Coverage for stolen personal items

Comprehensive insurance will help you replace your stolen vehicle and any stolen parts, such as the tires or the catalytic converter. But it won’t pay to replace any stolen personal items.

If you have a homeowners insurance or renters insurance policy, it may cover stolen personal property, even if taken from your vehicle and not your home.

For example: Suppose you left your laptop in your vehicle, and someone stole the car from your driveway in the middle of the night. Because you have comprehensive insurance, your auto policy will pay to replace your vehicle. Your homeowners or renters policy may pay to replace your laptop.

How much comprehensive will pay for a stolen car

Generally speaking, comprehensive coverage pays the depreciated value of a vehicle — also known as its actual cash value. That means you shouldn’t expect your insurance company to pay you for the amount you paid for the car.

Instead, your insurer will determine what the vehicle was worth at the time of the theft after depreciation. The depreciated value of a vehicle depends on its age, mileage, condition, and other factors.2

A car that’s just a few years old with low mileage and no previous incidents will be worth more than a car that’s a decade old with lots of miles. But a car that’s been in accidents or has high mileage might end up being worth less than an older vehicle of a similar make and model.

Suppose you bought a vehicle 10 years ago for $20,000. The car is in pretty good condition — it’s never been in an accident and has an average number of miles on it. The car insurance company factors in depreciation and decides the current cash value of the vehicle is $8,000. It will pay you $8,000 minus your deductible amount.

Cost of comprehensive coverage

Comprehensive coverage is usually part of a full-coverage policy that also includes liability and collision. It’s optional, meaning it’s not legally required like liability coverage. But if you finance or lease your vehicle, your contract will require you to have full coverage.

The cost of comprehensive car insurance varies across insurance companies and across states. The table below breaks down the average cost of full-coverage auto insurance and the cheapest option in each state.

How to file a claim for a stolen vehicle

Filing an insurance claim for a stolen vehicle is similar to filing any other sort of auto insurance claim. A key difference is that, unlike when your vehicle is in an accident, there’s no damage to take pictures of, or for an insurance adjuster to evaluate.

Follow these steps to file a claim if your car is stolen:

What happens after you file a stolen vehicle car insurance claim?

Once you’ve filed your auto insurance claim, your insurance company will process it. Insurance companies generally must process your claim within 30 days.3 In the case of theft, they may be more likely to take the entire 30 days to see if your vehicle is returned.

The way your insurance company will settle your claim depends on whether the vehicle is ultimately recovered. Keep in mind that comprehensive coverage generally requires a deductible. Your lender will reduce any payout you receive, either for a total loss or smaller damage, by your deductible amount.

If your car isn’t recovered

If your car isn’t recovered, the insurance company will declare it a total loss, just as it might after a serious accident. You’ll receive the vehicle’s actual cash value, minus your deductible.

If your car is recovered

If the authorities recover the vehicle, the insurance company will assess the damages. If the car is severely damaged, your insurer might still declare it a total loss. If the damage is minor, the insurance company will only pay for that damage.

It’s also possible that the car will be recovered after the insurance company settles your claim. If that’s the case, the insurance company owns the vehicle and can do with it as it pleases.

How to prevent vehicle theft and vandalism

Though the comprehensive coverage on your auto insurance policy will cover vehicle theft, you’re best off avoiding theft altogether. Not only is it inconvenient to be without a vehicle, but you’ll still likely face some financial loss, between your deductible and the cost of buying a new car, which is likely to be more expensive than the one you’re replacing.

Here are a few tips to help you avoid having your vehicle stolen or vandalized:

• Lock your doors. It may seem obvious, but locking your car doors is one of the most important steps you can take to avoid vehicle theft. Often, criminals will try door handles until they find an unlocked one, making it an easy target.

• Don’t leave a key in the car. Make sure to remove all keys from the vehicle. That means you shouldn’t leave your key in the vehicle when you’re home or running into a store, nor should you leave a spare key in your car.

• Remove valuables from the car. Keeping valuables in your car — especially if they’re easily visible — can attract potential thieves. Make sure anything of value left in the vehicle is hidden away where it can’t be seen through the window.

• Park in well-lit areas. A potential car thief will most likely look for cars in dark areas so no one can see them. You can deter thieves by parking in a well-lit area where someone could be easily seen.

• Have an anti-theft device. Consider installing an anti-theft device on your car, which would put off a loud noise if someone tries to steal your car. This type of device will quickly deter a thief, and many vehicles come with them already installed.

• Use an immobilizer. A car immobilizer is an electronic security feature that prevents someone from hot-wiring and stealing your car. It would prevent someone from stealing your car without the key.

• Have a vehicle tracking system. In the worst-case scenario that someone steals your car, you can increase your chances of getting it back if you have a vehicle tracking system installed. This is something that newer cars may come with already.

Car theft insurance FAQs