Car theft is a serious issue in the United States-so serious, in fact, that the Insurance Information Institute, in partnership with other organizations, has created Wiser Drivers Wise Up in an effort to help inform drivers of the risks. But if the worst happens and your car is stolen, what happens to your insurance rates?
Stolen Car Claims & Insurance Rates
This is a common fear, and it’s no wonder. You can avoid getting traffic citations by driving the speed limit and obeying traffic laws, but a stolen car is not your fault. It doesn’t seem fair that your insurance rates should increase as a result of car theft.
Fortunately, insurance companies usually feel the same way. Comprehensive claims, such as those filed because of a stolen car or vehicle vandalism, usually don’t result in increased insurance rates. Since car theft isn’t the fault of the consumer, your insurance carrier probably will not punish you for it.
However, it is important to know whether this is the case for you before your car is stolen. Contact your insurance agent and ask what happens after a car theft and how the claim is handled. Use this time to check and see if you have adequate comprehensive coverage. For example, according to Wiser Drivers, rental cars are not automatically covered for a stolen car.
How Car Theft Impacts Insurance Rates
Even if most insurance companies don’t punish a driver by increasing insurance rates because of a stolen car, this doesn’t mean your premiums don’t take a hit. If you live in a city where car theft is common, for example, your premiums might be higher to cover the additional risk.
And since standard liability coverage does not provide any relief for a stolen car, you will have to pay more to obtain comprehensive coverage. You should check the fine print to make sure the entire value of your vehicle will be covered and purchase gap insurance if there is any discrepancy between what you will owe and what the insurance company will pay out.
Avoiding Auto Theft
Wiser Drivers offers a number of tips for consumers who want to keep their vehicles safe. To avoid a stolen car:
- Park in well-lit areas when shopping or visiting friends, and try to park in a garage at home.
- Consider after-market anti-theft devices rather than relying on the tools your car came with.
- Find out whether car theft is common in your geographical location and take appropriate precautions if it is.
- Report your stolen car immediately, because the chances of it being found will be greatly increased.
You cannot possibly avoid all instances where car theft might occur, so be prepared in case it does happen. Keep copies of your insurance information at home or in your wallet, and make sure you know the license plate number, VIN number and description of your vehicle so you can give it to the police.
Wiser Drivers Wise Up