How Does Insurance Work If Your Car Is Stolen?

If you have the right insurance in place, it will cover an automobile that has been involved in a theft.

Protection against automobile theft is not included in a basic auto policy. However, with optional packages such as comprehensive insurance, you will be covered if your vehicle is stolen.

This type of endorsement can help:

• Replace a stolen vehicle
• Replace parts that are stolen or damaged
• Repair damages to your automobile from theft or a break-in

You can add protection against auto theft by adding any of these additional modifications to your insurance:

1. Comprehensive: This pays for the cost to repair or replace your automobile as a result of unforeseen situations.
2. All Perils: In addition to theft protection, it provides protection against loss if your vehicle is taken by someone living in your home.
3. Specified Perils: If you don’t want to add comprehensive but want theft protection, you can add a specified peril.
4. Gap Insurance: Comes in handy during total loss claims, such as a stolen car. It is the difference, or gap, between how much your vehicle is worth and how much you owe.

If your vehicle is among the top most stolen vehicles, you may see a premium surcharge. Insurers are looking for avenues to help combat the rising costs of claims for high-risk vehicles. Some companies are offering incentives for installing anti-theft devices.

When you file a car insurance claim for a stolen vehicle, expect your insurer to open an investigation.

You will be expected to provide the following information:

• When and where the incident occurred: The time, date and location it was stolen.
• Vehicle details: Year, make, model, kilometres, other distinguishing marks (stickers, scratches, etc.).
• Police report: Insurers will want a copy of your police report.

On average, it takes 11 days for an automobile to be found and 30% of recovered vehicles come back with damages.

Most companies have a minimum waiting period before closing the claim. Typically it is 30 days. This happens to see if your vehicle can be recovered. Since companies are different in how they handle claims, ask them about the expected time frame.

If your automobile is stolen and not recovered, it will be considered a total loss. You will work with your insurer to agree on the market value or actual cash value (ACV). This is the amount you will be paid out. You will not be reimbursed for the vehicle's original value or the replacement cost.

Auto theft can affect how much you pay for insurance. It costs drivers, companies and the government millions of dollars annually. It is impacted by many factors such as:

• Where you live: Car insurance in Toronto and other larger cities like Mississauga and Ottawa are known more car theft. If you live in a neighbourhood that is known for a high amount of automobile thefts, you can expect higher premiums.
• The automobile you drive: Automobiles that are common targets for theft cost more to insure. Each year the IBC puts out a list of the most stolen cars in Canada.

Once you are positive your vehicle has been stolen, contact the police immediately to file a police report and follow their instructions. Call your insurer to inform them about the situation. Contacting them also protects you if your automobile is used to cause harm or commit a crime.

Here are the three key steps to take if your vehicle has been stolen:

1. Be sure your vehicle is stolen: While your first reaction will be to call the police immediately, take a few minutes to consider if it was actually stolen. Could it have been towed? Did you lend it to someone? Who else do you know who has access to your keys? Could it have been repossessed?
2. Call the police: Call your local police to start the investigation process. You will be expected to provide a detailed explanation of your vehicle, including the make, model, license plate, VIN, and details surrounding the event. Also notify the police of technology that may be able to help them track down your vehicle, such as the telematics system.
3. Call your insurer: As soon as you have filed a report, call your insurer. This will protect you if it is used in a malicious manner. Provide as much information as possible, including personal items that were inside the car at the time.

Auto theft is preventable. In fact, nearly half of thefts are due to driver error – leaving the doors unlocked, keys in the ignition, etc. Follow these prevention tips to lower the chances of your automobile being involved with theft:

• Always lock your vehicle: Make sure all doors are locked before you leave your vehicle.
• Spare keys and fobs: Never leave a spare key in your vehicle or any easy place to find. There has also been an increase in electric car theft - learn how to limit the risk of keyless fob vehicle theft on our blog.
• Never leave your vehicle idling unattended: Never leave your keys in the ignition or the car running without someone inside.
• Park in the garage: If you have a garage at home, consider parking your vehicle inside it and locking the garage door.
• Keep windows rolled up when parked: Always close your windows and sun roof before exiting.
• Park in well-lit areas: Always park in well-lit and high-traffic areas, especially at night.
• Invest in anti-theft devices: Installing a theft prevention device will make it more difficult to steal, less of a target for thieves, and you could qualify for insurance discounts.
• Keep valuables out of plain sight: Never leave valuables, such as your phone, wallet, or shopping bags where people can see them.
• Install a tracking device: Install a tracking device like Tag which is a tracking and recovery system for your vehicle.
• Stay up to date: Follow the news and take note of the top vehicles and parts, such as catalytic converters, that are targeted for theft. Thieves are also finding ways to utilize technology to steal cars - take a look at this CBC article that uncovered crime rings that export stolen cars in Canada ended up West Africa.
• Protect your VIN: Consider covering up your vehicle identification number and keep a copy of your VIN at home to inform authorities if needed.