Many people who have their car stolen wonder how it will affect their insurance rate. Theft is covered under certain types of auto insurance programs, and since the event is not the fault of the driver, it will not count against you. Here are some things you should know about car insurance when your car is stolen, and what types of coverage you do have in the event of theft.
Common Reasons for Rate Increases
If you live in an area with a high vandalism or crime rate, you may be subject to a higher-than-average insurance rate. Your rate may also increase if you move to an area that has been deemed “high risk” by the insurance company. However, an insurance company will not increase your rate when your car has been stolen. The event will simply become another statistic for that area or neighborhood, and the insurance provider will compensate you based on the insurance contract.
There are several other reasons why your car insurance premium might increase. These include:
– You are at fault in an accident
– You increase your coverage limits
– You lower the deductible
– You change the usage reasons of your vehicle
– You start to drive more miles per year
– You replace an older vehicle with a newer one
– You purchase a vehicle that has a high risk of theft
– You get multiple traffic tickets
– You add another vehicle to the policy
– Another vehicle on the policy has a high risk of theft
What Happens When Your Car is Stolen
As long as you carry comprehensive car insurance, you are covered against theft of your vehicle. Your auto insurance company is responsible for paying you for your vehicle’s actual value, and you can then go ahead and purchase another car. The amount you are compensated will also reflect the deductible amount.
If your car has anti-theft devices, or you have invested in an anti-theft device as an extra security measure, you may be eligible for lower rates. Many auto insurance companies will offer a lower rate for cars that have anti-theft devices, such as immobilizers, vehicle alarms and vehicle trackers, because they feel that the car is less likely to be stolen. Make sure you inform your auto insurance company of any anti-theft devices on your vehicle so that you can get the best rate.
Your insurance rate won’t increase after your car is stolen, but you may still be paying a higher-than-average insurance premium if you live in a high-risk area. It’s a good idea to review all the stipulations of your comprehensive coverage contract to determine what type of coverage you have, and consider investing in anti-theft devices to lower your insurance rate.