The least stolen car in the US: Toyota Prius. But how does car insurance cover theft anyways? Image: Flickr.
The Toyota Prius is one of the most fuel efficient vehicles on the market, has low emissions, and great trunk space. When looking a car thieves
wish list, these qualities are low. According to the National Insurance Crime Bureau, only 1 in 608 Prius cars are stolen, versus 1 in 78 for all other cars. While owners may enjoy their small environmental footprint, they can also enjoy the comfort that their car will most always be waiting for them as they exit their home or a restaurant. Most cars are stolen to be broken up and sold for parts and the Prius is not as versatile as other models that are on the road. While this is good news for Prius owners, owners of Toyotas and Camry should pay attention. After the shock
of having a car stolen wears off, it will be the best insurance policy that saves the day.
Does Insurance Cover a Stolen Car?
States have a standard level of insurance that is legally required for all drivers. While this attempts to ensure that all drivers on the road have some form of coverage, often it is the bare minimum and rarely covers significant events , such as having a car stolen. Comprehensive coverage is the only form of vehicle insurance that can insure an individual’s vehicle against theft. It can also be known as ‘Other than Collision.’ Collision insurance covers damage that results from colliding with another object such as a car or post. Comprehensive is important to add to a policy because it insures a vehicle against accidental damage such as weather related issues as well as theft. Make sure comprehensive insurance is part of all vehicle policies.
What To Do if Your Car is Stolen
After immediately contacting the police, a car theft victim should call his or her insurance company. It is best to report theft as soon as possible. The insurance company will need some important information to properly file a claim and make sure that the insured is completely covered. This information includes the license plate number, the vehicle identification number (VIN#) and the year, make, and model of the vehicle. Unfortunately, many people leave something such as the vehicle identification number if the car on a permanent basis. It is important to always keep copies of documents such as car registrations in a safe, flame retardant part of the home.
Once a
file is claimed with the insurance company and a report filed with the police, under the coverage of a comprehensive policy, the insurance company is required to pay for a vehicle’s actual value so that the insured can purchase another car. The deductible amount is reflected in this payment. This will not happen immediately. Insurance companies allow a certain amount of time to
pass in the hopes that the stolen vehicle will be recovered. During this time, the insurance company could provide a rental car as long as it is part of the policy. This is another important insurance policy to take into consideration when looking at unexpected situations. Daily car rental rates can begin to add up and with insurers, it can only cost mere dollars to add a rental car option to a policy.
If the car is not recovered, the victim and insurance company will come to a settlement about the value of the car and how much is owed to the victim. This is an area that can be negotiated because sometimes the owner will believe that the vehicle possessed a much higher value than what the insurance company may be willing to pay out. If this is the case, substantial information must be provided to demonstrate the worth of the vehicle. It is important to note that if one is disputing the original offer from the insurance company, the insurer is not obligated to keep the victim in a rental car, if they had done so originally. This may be a factor
to keep in mind when looking at the appraised value. Once a settlement agreement has been signed, the claim will be closed.
Will Car Theft Affect My Long Term Rates
There may be people that worry if a car is stolen, it could have long term effects on their insurance policy. There are several ways that yearly premiums can increased, some of which but are not limited to: lowering deductibles, change vehicle use and/ or number of miles driven per year, multiple traffic tickets, certain claim types and adding another vehicle to a policy. The only way that auto theft can
increase premiums is if an individual lives in high risk area , meaning the chances of having a car stolen increases or if someone purchases a vehicle that has a high risk of theft. When looking into properties and new vehicles, check with the insurance company to see how much things of this nature can affect premiums.
