How Does Insurance Replace Your Car When It's Stolen?

Auto insurance can pay to replace a stolen vehicle.
Auto insurance can pay to replace a stolen vehicle. (Image: off-road vehicle image by goce risteski from

If you've ever had your vehicle stolen, you know how stressful the situation can be. Fortunately, the right type of auto insurance can pay to replace your vehicle and get you back on the road. An understanding of the claim process as well as your coverage details can help the proceeding go more smoothly and ease some of the aggravation.

Proper Coverage

You will not be compensated for your stolen vehicle unless you have the right type of coverage. Comprehensive insurance covers vehicle theft in addition to non-accident-related damage to your vehicle such as vandalism, natural disasters and chipped or cracked windshields. Comprehensive insurance is generally purchased in conjunction with collision, which pays for damage to your vehicle that results from an accident. Comprehensive coverage requires you to pay a deductible, which is the amount you pay out of pocket before coverage begins.

Claim Process

If you believe your vehicle was stolen, call the police as soon as possible to report the theft, and also call your insurer to file a claim. Your company will arrange to get you a rental vehicle if your coverage includes this while they initiate the claim investigation. After the waiting period stipulated in your policy has passed and your vehicle still has not been recovered, your claim adjuster will offer you a settlement, based on what the company considers to be the vehicle's actual cash value. Your deductible amount will be subtracted from the settlement offer.

Replacing Recovered Vehicle

If your vehicle is recovered during the waiting period but has suffered significant damage, your insurance company may declare it a total loss if the cost to repair it would be prohibitive. As with a vehicle that has not been recovered, your insurance company will offer a settlement based on the vehicle's actual cash value. Whether the vehicle is recovered or not, if the vehicle was financed and you still owe more on the vehicle that what you receive in a settlement, you are responsible for paying the balance.

Personal Property

Be aware that your auto policy will only pay to replace the vehicle itself, not for any personal property that was inside the vehicle when it was stolen. In many cases, coverage for personal property in your vehicle extenda from your homeowners or renter's insurance policy. However, because the property was not located on the insured premises when it was stolen, you will probably receive a reduced settlement amount.

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