If My Car Gets Stolen, Does My Insurance Go Up?
Uncover how car theft claims affect your auto insurance premiums and the broader factors influencing your rates. Get practical guidance.
Car theft can raise questions about its impact on insurance premiums. This article clarifies the relationship between car theft and auto insurance rates, explaining relevant coverage and factors that influence premiums after a vehicle is stolen.
Understanding Theft Coverage
Protection against car theft typically falls under a specific part of an auto insurance policy known as Comprehensive Coverage. This coverage is designed to help repair or replace your vehicle if it is stolen or damaged by events other than a collision with another car or object. Comprehensive coverage extends to various non-collision incidents, including vandalism, natural disasters like hurricanes or floods, fire, falling objects such as tree branches, and damage from animals.
This type of coverage differs from Collision Coverage, which addresses damage to your vehicle resulting from an accident with another vehicle or object, regardless of fault. It also stands apart from Liability Coverage, which pays for damages and injuries you might cause to others in an accident. While liability coverage is often a state requirement, comprehensive coverage is usually optional, unless your vehicle is financed or leased, in which case lenders frequently mandate it to protect their investment. Without comprehensive coverage, a stolen vehicle would not be covered by your auto insurance policy.
How a Theft Claim Affects Premiums
When your car is stolen, filing a claim with your insurance company is generally considered a “not-at-fault” claim, as you did not cause the incident. While these types of claims typically have a less severe impact on premiums compared to at-fault accidents, they can still influence your insurance rates. Insurers assess risk, and a claim, even if not your fault, can signal an increased likelihood of future claims, which may lead to adjustments in your premium.
One reason for a potential increase is the loss of “claims-free” discounts, which reward policyholders who have not filed claims for a certain period. Even if your insurer does not directly penalize you for a not-at-fault theft, losing these discounts can effectively raise your overall cost. The exact impact varies significantly based on the insurer’s specific underwriting policies, your past claims history, and the overall claims environment in your area. Some jurisdictions have laws that limit how much insurers can increase rates for certain not-at-fault claims.
Other Influences on Insurance Costs
Beyond a car theft claim, numerous other factors contribute to the calculation of your overall auto insurance premiums. A pattern of multiple claims over time, even if each individually is not at fault, can indicate a higher risk to insurers and may lead to increased rates. The specific type of vehicle you own also plays a role, as certain models are statistically more prone to theft, resulting in higher premiums for those vehicles. Your geographical location is another significant determinant; areas with higher rates of vehicle theft or vandalism have higher insurance costs.
Your driving record, including any speeding tickets or previous accidents, directly influences how insurers perceive your risk profile. Personal factors such as your age, marital status, and, in many states, your credit score are also considered when setting rates. Insurers reassess these elements, and a car theft claim, combined with other individual and environmental factors, contributes to their evaluation of your risk as an insured driver.
What to Do After Car Theft
If your car is stolen, take immediate steps to facilitate the insurance claim process. The first action should be to report the theft to the police without delay. Obtain a police report number, as this documentation is required for your insurance claim and aids in the vehicle’s recovery.
Following the police report, promptly notify your insurance company about the theft. You will need to provide them with detailed information about the stolen vehicle, including its make, model, year, Vehicle Identification Number (VIN), license plate number, and its last known location. Additionally, compile a list of any personal belongings that were inside the vehicle, as some of these items might be covered under a separate homeowners or renters insurance policy rather than your auto insurance. Insurers have a waiting period before declaring a stolen vehicle a total loss and issuing a payout, allowing time for recovery.