Does Auto Insurance Cover Theft? Understanding the Fine Print

One of the biggest reasons to carry car insurance is so you’re not left stranded when a thief victimizes you, whether by stealing the whole vehicle or just a crucial piece of equipment (like the catalytic converter). But auto insurance coverage for theft is highly variable. It’s complicated and varies for everyone. Coverage will depend on the chosen policy, although most policies may cover theft to some degree. It all boils down to the specific policies of each individual insurance provider.

In this blog post, we'll break down whether auto insurance covers theft and how auto theft is generally covered so that you can make informed decisions to keep yourself as protected as possible.

Does Auto Insurance Cover Theft?

Yes, it does! If you carry comprehensive insurance, that is. Comprehensive coverage is the only type of insurance that covers theft. The extent of coverage depends on the type of policy in place, but it can include theft of the vehicle or reimbursement for damage inflicted by a thief during break-in or driving.

Comprehensive coverage can do wonders for those unfortunate enough to experience car theft. And even though it costs more money upfront, in the end, comprehensive coverage could save you quite a lot.

Every policy and company is different, so it’s up to you to read and understand your particular agreement—especially when it comes to which coverage addresses thefts and which incidents are excluded. So be sure to review those details before assuming any coverage at all.

Overall, this means that having comprehensive auto insurance coverage—often called full coverage—makes perfect sense for anyone who wants peace of mind each day. After all, what better way could there be to limit the stress associated with stolen vehicles than to be one step ahead in preparing for such an unfortunate event?

How Are Cars Covered by Insurers for Theft?

Understanding how car theft claims work and the types of coverage available to restore a stolen vehicle can help individuals become better-informed consumers.

Comprehensive coverage for stolen vehicles.

Stolen vehicles are a real pain, but having comprehensive coverage will provide relief in the statistically unlikely event it happens to you. When it comes to insuring a vehicle against theft, comprehensive coverage is the way to go. Not only does it provide intrusion protection against theft, but it also reimburses you in the event of fire, weather damage, and denials of service from rental companies.

Furthermore, comprehensive coverage pays out on stolen vehicles even if the thief isn’t apprehended or fails to reimburse you for the loss, meaning you don’t have to take out another policy if your car is never found. Additionally, this type of coverage typically isn’t expensive and helps round out an all-inclusive car insurance policy.

No one ever wants their vehicle stolen; however, having comprehensive coverage gives peace of mind that you can be compensated fairly should something happen. Thus, all car owners should seriously consider taking out comprehensive coverage, even though the state they live in may only mandate liability coverage.

It is essential to read through an insurance policy and ask questions, if necessary, so that you have all the information about what is and isn’t covered. Insurers may handle a car theft differently from one instance to the next, and you should know how your provider will treat the situation if you need to file a claim and what photos and documentation, if any, that you could provide to help the process. That way, you can receive compensation for the theft in a timely manner and with minimal stress.

Remember, don’t take anything for granted when it comes to obtaining insurance coverage—ask questions and read solutions! Taking all of this into account, finding out whether or not your insurer covers the theft of a vehicle should not present any difficulty whatsoever.

Coverage for parts and equipment (CPE).

Vehicle parts and equipment coverage encompasses a wide breadth of stolen or damaged parts but is only as strong as the rider that defines it. Understanding your insurer’s specific terms and limitations when it comes to covering theft will tell you whether equipment coverage makes sense for you, depending on the value of separate vehicle add-ons.

When your car insurance policy has a CPE rider, you can be reimbursed for the theft of certain items that are excluded from standard policies. Be sure to speak with an agent directly to confirm your understanding so there are no surprises when dealing with any kind of claim.

Although cars are at greater risk of theft than they used to be, hopefully, with comprehensive vehicle parts and equipment riders, you can remain confident that you will be reimbursed.

Gap coverage.

Auto theft is an unavoidable risk of owning a vehicle, and gap coverage can offer peace of mind should your ride ever be targeted. It provides a valuable buffer in the event that the estimated value of your car is mismatched with the cost of repair or replacement. Furthermore, gap coverage offers peace of mind to those who want more protection than basic liability.

Gap coverage isn’t necessarily right for everyone, but a few years ago, plenty of people were glad they had it. Prices for new cars skyrocketed during the chip supply shortage, so if your $28,000 vehicle got stolen and the identical replacement was suddenly $39,000, you were stuck paying the difference without gap coverage. Insurance companies tweak and improve their gap coverage to woo customers, so be sure to ask about any other options that may be available as you make your decision.

Additionally, if you’re researching the ins and outs of gap insurance, read through the details carefully and take your time to make sure that this type of protection makes sense for you and your car.

Theft Prevention Tips

While it’s not always possible to prevent theft, you can take steps to greatly decrease the chances of auto theft happening to you.

• Keep your car locked at all times.
• Never leave any belongings in sight.
• Use antitheft devices when possible.
• Park in populated and well-lit areas.

Doing this can go a long way toward protecting your ride from criminals.

Will Auto Insurance Cover Personal Items Stolen From the Car?

No, auto insurance won’t reimburse you if your personal items have been taken from your vehicle. Other than carrying a standalone personal property policy, you can protect yourself from item theft by using a car alarm and storing high-valued items out of sight.

Remember that carrying the right amount of coverage will help you obtain fair compensation for losses stemming from a vehicle-related incident, including theft or an accident. Be sure to understand the ins and outs of your policy so you’re never without protection when on the road.

Will Liability Insurance Cover a Stolen Car?

Liability insurance doesn’t cover car theft, only car accidents. The best way to make sure you're protected is with comprehensive coverage. It’s important to understand the essentials of auto insurance so you can make informed decisions on what type and how much coverage best meets your needs and budget.

Since liability insurance does not cover a stolen car, there is greater peace of mind as well as financial protection when drivers select higher levels of coverage.

Summing It Up

Auto insurance covers theft in most cases so long as you carry comprehensive coverage, not just liability. Make sure to understand the fine print. The amount of coverage you’re getting for your insurance for theft will depend on both your insurer and the type of policy you get.

Before purchasing an auto insurance policy, ask detailed questions about what is and isn’t covered so that you are not left inadequately covered. Also, recognize that even if a policy covers theft, there can be other exclusions, deductibles, and limits you should be aware of before committing to a plan.

Finally, check back often with your insurer on how various pieces of legislation or changes made by them could alter any agreed-upon coverage levels. Knowing the ins and outs of your specific policy can save you unexpected costs in times of auto theft or other loss.