Does Your Car Insurance Cover Auto Theft?

Comprehensive coverage helps protect against car theft and break-in damage, but it does not cover personal belongings or custom vehicle upgrades.

To stay covered against theft, check that your policy includes comprehensive coverage and add it if it doesn’t. Unlike liability coverage, which is mandatory in virtually every state, comprehensive is optional. It pays for non-collision damage to your car like theft, vandalism, falling rocks, fires, floods, and other natural disasters.

Here’s what comprehensive covers for theft:

• Stolen cars. Your insurer will pay for your car’s actual cash value (ACV). This applies even if you recover your car and its damages exceed a certain percentage of the ACV.
• Stolen car parts. Your insurer will cover the costs if someone steals your vehicle parts, including tire and catalytic converter theft.
• Damage from break-ins, such as smashed windows and busted doors.

And here’s what it doesn’t:

• Theft of personal items, such as a laptop you left in your car.
• Theft of vehicle upgrades, including aftermarket and custom parts. Comprehensive coverage only applies to permanent, pre-installed car parts. To get vehicle upgrades covered, you’ll need custom parts and equipment coverage instead.

For any covered incidents, you’ll pay a deductible before your insurance kicks in to cover the remaining costs. If you have a leased or financed vehicle, you probably already have comprehensive as it’s usually required by lenders.

Comprehensive insurance coverage is generally more valuable for newer vehicles with higher actual cash values.

With a comprehensive policy, your maximum payout is your vehicle’s ACV. That’s why comprehensive is more worth it for newer cars (which have higher ACVs), and less so with older cars (which have lower ACVs). Since an older car is worth less, it’s likely any repairs will cost more than its ACV, which means the car would be a total loss.

Different states have different total loss thresholds. See the table below to find yours.

While comprehensive coverage is important, other types of insurance help cover costs that you’d otherwise be liable for if you’ve been robbed:

• Homeowners or renters insurance: To protect personal items in your car, you’ll need off-premises coverage from a home or renters insurance policy. Unfortunately, comprehensive coverage only applies to the car itself and its parts.
• Gap coverage: This fills the gap between your car’s ACV and what you owe on it. Like a comprehensive policy, gap coverage is required for leased or loaned vehicles.
• Rental car coverage: If your car is being repaired under a covered claim or you haven’t bought a replacement yet, this will pay for your rental car in the interim.

Here’s how to reduce the likelihood of getting your car stolen or broken into.

Use anti-theft devices.

These are classified into passive or active anti-theft systems:

• Passive anti-theft systems automatically engage when you turn off the vehicle and remove the key. Examples include engine immobilizers that prevent the car from starting without the correct key, and automatic door locks that activate when the car is turned off.
• Active anti-theft systems require the driver to take action to arm them, such as pressing a button on a remote key fob to lock the doors or manually setting a steering wheel lock. These are considered less reliable than passive systems by insurers.

Some insurers offer discounts for installing these devices, including:

• Nationwide
• Good2Go
• GEICO
• Dairyland
• Amica Mutual
• Allstate
• AARP
• AAA

Watch where you park.

Whenever possible, park in garages. If you have to park in public, choose well-lit, populated, open areas far away from dumpsters, trucks, or anything else that obstructs visibility. Avoid loiterers and dark alleyways if you can.

Lock it up and light it up.

In addition to locking your car, remember to lock your home’s garage or gate. Install motion-activated lights around your home to deter burglars when your car is parked there.

You can reduce the risk of vehicle theft by using anti-theft devices, parking in secure locations, and installing exterior lights.

Car theft happens, even to the most careful drivers. Here’s what to do if your car is stolen:

1. Confirm it’s been stolen. Make sure your car was actually stolen and wasn’t towed, repossessed, or impounded.
2. Call the police. If it was stolen, file a police report for your claim.
3. Try to recover it. Use your tracking devices to try to locate the car yourself, if you have any installed.
4. File a claim. File a claim with your insurance provider.

If you recover your car after following the above:

1. Contact your insurance company. Let them know that you’ve found the car.
2. File insurance claims for damages. If your car has any damages that weren’t there before, file claims for them.¹

No one ever wants to deal with auto theft and burglary, but if you have comprehensive coverage, you won’t have to pay out of pocket for repairs or replacements, excluding your deductible. Check out our auto insurance shopping guide for help picking a full coverage insurer.