When Does Car Insurance Cover Theft?

Key Takeaways: Car Theft Coverage

Comprehensive coverage pays for vehicle theft, but your deductible reduces your payout and a small claim can cost more in future rate increases than you get back.

Personal items stolen from inside your car aren't covered by auto insurance. Those claims go through your renters or homeowners policy instead.

If your car was bought with a loan, gets stolen and can't be recovered, gap insurance covers the difference between what your insurer pays and what you still owe the bank.

When Car Insurance Covers Theft and When It Doesn't

Comprehensive coverage is the only type of car insurance that covers vehicle theft. Liability coverage only pays for damage you cause to other people, not damage or loss to your own car. If you only carry liability, theft isn't covered at all.

When your car is stolen outright, calling your insurer and submitting a claim is almost always worth doing. Your insurance company pays what your car was worth on the market the day it was stolen (called its actual cash value) minus your deductible. For most cars, that market value is much higher than a $500 or $1,000 deductible, so you come out ahead.

For smaller damage from a break-in, like a broken window, a stolen catalytic converter or a broken door lock, the calculation is different. If you make a second insurance claim within two to three years, your insurer will likely raise what you pay each month, and those extra monthly costs can add up to more than the money you got from the claim. Before you submit any claim, call your insurance company and ask: "Will this claim cause my monthly rate to go up, and if so, by how much at my next renewal?" That answer may change whether submitting the claim makes financial sense at all.

Mark Fitzpatrick, licensed insurance agent: "Your personal belongings inside the car aren't covered by auto insurance. Claims for stolen belongings go through your renters or homeowners insurance policy instead. Knowing that before you call your auto insurer saves time and frustration."

What Theft Scenarios Comprehensive Coverage Pays For

Comprehensive coverage applies when your vehicle itself is stolen or damaged during a theft attempt:

Theft from a parking lot, driveway or any other location where you park
Window or door lock damage from a break-in attempt
Damage inside a recovered stolen vehicle. Your comprehensive coverage pays for this too, since insurance companies treat it the same as vandalism.
Catalytic converter theft, since the catalytic converter is part of the vehicle

What Theft Scenarios Auto Insurance Doesn't Cover

Several theft situations fall outside comprehensive coverage entirely:

A laptop, phone, wallet or any other personal property stolen from inside your car
Theft that occurs because you left your keys in the ignition. Most insurance companies deny these claims because they treat leaving keys in the car as carelessness on your part. Check your policy's theft exclusions section before assuming you're covered.
Theft by a family member or someone who lives in your household
Commercial equipment or tools stored in your vehicle

Vehicle Theft vs. Personal Property Theft: What's Different

What was taken determines which insurance policy pays. Your auto policy covers the car itself. Your renters or homeowners policy covers everything inside it.

If your car is stolen

Your insurer pays what the car was worth on the market the day it was stolen, not what you paid for it. Cars lose value over time, so a car you paid $25,000 for three years ago might be worth $17,000 today. That's what you'd collect, minus your deductible.

If something is stolen from inside your car

Your auto policy doesn't cover it. A laptop, phone or wallet stolen from your car goes through your renters or homeowners policy, which has its own deductible (often $500 to $1,000) and filing could raise your home insurance rate. If your home deductible equals or exceeds what was taken, skip the claim and pay out of pocket.

Do You Pay a Deductible When Your Car Is Stolen?

Yes. Your comprehensive deductible applies to every theft claim. If your car is so damaged or so thoroughly stolen that the insurance company won't pay to repair or replace it (called a total loss), your insurer pays the car's market value minus your deductible. For a recovered car with damage, the deductible applies to repair costs.

Your deductible is listed on your policy's declarations page, the first page of your policy document. Most drivers carry a $500 or $1,000 comprehensive deductible.

Some policies offer a $0 deductible for glass claims. Choose this option if you regularly park your car outside. For total loss claims, a $0 deductible option is less common, and whether it makes sense depends on what your car is worth on the market.

SHOULD YOU FILE A THEFT CLAIM?

If your car is stolen, file the claim. What your car is worth on the market is almost always much more than your deductible.

For smaller damage, the math is different. A $700 catalytic converter claim with a $500 deductible puts $200 in your pocket before rate increases. If your insurer raises your rate $150 a year at renewal, you're worse off having filed. Before you submit any claim for minor damage, call your insurer and ask whether it will raise your rate. Most will tell you upfront.

Theft claims require a police report before your insurer will process anything. File the report immediately. Waiting reduces your chances of recovery and can complicate your claim. Here's the claims process from report to payout.

1
File a Police Report Right Away
Call your local non-emergency line or file online. Get the report number before you do anything else. Your insurance company will ask for the police report number immediately.
2
Contact Your Insurer's Claims Line
Most major insurers like State Farm, GEICO and Progressive have 24/7 claims lines. Call as soon as you have your police report number in hand.
3
Provide Your Vehicle Details
Give your insurance company your police report number and your car's VIN, the 17-character identification number printed on a sticker inside your driver's side door or on your registration. Include the last known location of the vehicle and a description of any items stolen from inside the car.
4
Ask About the Waiting Period
Many insurance companies wait 30 days before paying a total loss theft claim to see if the car is found during that time. Ask upfront. If your policy includes rental reimbursement coverage, that benefit applies during the 30-day waiting period. Without rental reimbursement coverage, you pay for the rental car yourself.
5
Work With the Claims Adjuster
If your car is found but damaged, an insurance company inspector (called a claims adjuster) will compare the repair costs against what your car was worth on the market. Document all damage with photos before anything is moved or repaired.
6
Review Your Payout
Your insurer sends a check for the car's market value minus your deductible. If you think the market value is too low, negotiate. Find listings for cars similar to yours and send them to your insurer to show that your car was worth more than they calculated.

THEFT CLAIM TIP

If you're still making payments on a stolen car, contact your lender immediately after filing your police report. Your lender needs to know right away because they technically co-own the car until the loan is paid off. If you have gap insurance, gap insurance pays the difference between what your auto insurer paid and what you still owe on the loan.

Will a Theft Claim Raise Your Car Insurance Rates?

A single comprehensive claim raises your rate less than a crash you caused, because theft isn't caused by your driving and insurers charge more when your behavior is what caused the damage. But your insurance company still records the claim, and a second comprehensive claim within two to three years can cause your rate to go up or your insurer to drop you when your policy expires.

The rate impact varies by insurer and state. Before submitting a claim for smaller damage, ask your insurance company directly: "Will this raise my rate, and by how much at my next renewal?" That 10-minute call can save you from submitting a claim that ends up costing you more in higher rates than you get back.

Car Theft Coverage: What to Know

If your car was stolen, call your insurer and submit the claim now. If the damage is smaller, do the math first.

Call your insurance company before submitting any claim for theft-related damage and ask two questions: "Will this raise my rate?" and "By how much will my monthly cost change at renewal?" If what you'd collect after your deductible and future rate increases is less than zero, pay for the repair yourself. A shorter claims history means your insurer is less likely to raise your rate or drop you later.

If you're deciding whether to add comprehensive coverage to your current policy, look up your car's market value first. Kelley Blue Book and NADA Guides are free websites where you can find it. If your car's market value is under $4,000 to $5,000, the yearly cost of comprehensive coverage may not be worth it.

Car Theft Insurance: FAQ

Does auto insurance cover theft if I left my keys in the car?

Most insurance companies deny theft claims when the keys were left in the ignition, because they treat it as carelessness on the driver's part. Some policies do cover it, but leaving-keys-in-the-ignition theft is a common exception that policies leave out. Check your policy's theft exclusions section before assuming you're covered.

What happens if my stolen car is recovered damaged?

Comprehensive coverage pays for the repairs minus your deductible. If repair costs are more than the car is worth on the market, the insurer declares the car a total loss and pays you the market value minus your deductible. If you think the market value is too low, find listings for similar cars and send them to your insurer to negotiate a higher number.

Does insurance cover stolen catalytic converters?

Yes. A catalytic converter is part of the vehicle, so comprehensive coverage pays for its theft. You'll pay your comprehensive deductible, usually $500 to $1,000. Replacement costs depend on your car's make and model and can reach several thousand dollars on some vehicles.

My car was stolen twice. Will insurance cover both claims?

Yes, your insurer pays both valid claims. After a second claim, many insurers raise your rate at renewal or decide not to renew your policy. Some will require you to install an anti-theft device as a condition of keeping your coverage.

Does gap insurance cover theft?

Yes. If your financed car is stolen and declared a total loss, comprehensive coverage pays what the car was worth on the market. If you owe more than that amount, gap insurance covers the difference. Without gap insurance, you pay that difference yourself and you still don't have a car.

Are items stolen from my car covered if I don't have renters insurance?

No. Without renters or homeowners insurance, personal property stolen from your car is not covered anywhere. Auto insurance covers only the vehicle. If you regularly keep valuables in your car, a renters insurance policy covers them, and basic renters policies are inexpensive. MoneyGeek's break-in coverage guide explains exactly what the policy pays for and where coverage ends.

Does car insurance cover other weather or non-collision damage?

Yes. Comprehensive coverage also pays for flood damage, hail damage, animal damage and vandalism. The same deductible applies to each.

About Mark Fitzpatrick

Mark Fitzpatrick, a Licensed Property and Casualty (P&C) Insurance Producer in Connecticut, is MoneyGeek's resident insurance expert. He has spent nearly a decade analyzing the market, first at LendingTree and now at MoneyGeek, where he has produced original research on hundreds of carriers and millions of rates across auto, home, renters, health and life insurance.

He covers economics and insurance at MoneyGeek, and his work has been featured in The Washington Post, The New York Times and NPR, among other outlets.

Like all MoneyGeek analysts, he draws on independent cost and consumer experience data, and no insurance company partnership influences his recommendations.

Fitzpatrick earned his degrees from Johns Hopkins University (M.A. Economics and International Relations) and Boston College (B.A.). He began his career in financial risk management at State Street. He's also a five-time “Jeopardy!” champion.

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