How Does Car Theft Affect Insurance Premiums?

There were well over 1 million car thefts in the United States last year. New York was hit particularly hard, seeing a 23% increase in auto theft.

To make matters worse for victims, a stolen car often raises auto insurance costs. But how does car theft affect insurance premiums exactly?

The following guide will explain why car theft results in auto insurance going up and what to expect.

How Does Car Theft Affect Insurance Premiums?

First of all, note that vehicle theft doesn’t always result in car insurance going up. It takes specific circumstances to trigger rates to increase and it usually isn’t a large amount.

One way it typically goes up is if you’ve filed a claim through your comprehensive coverage. If you have a lot of claims already in your history, you should also expect a slight auto insurance increase.

Avoiding Increases

You don’t have to worry about your auto insurance rates changing if your policy only has coverage for basic liability. However, you’ll have to pay to replace the car completely on your own without aid from insurance.

Depending on the value of the vehicle stolen, a rate increase might be much better than paying out of pocket for a replacement. Accidents and moving violations cause rates to go up much more than theft.

Comprehensive Coverage

Car theft is protected by the comprehensive coverage in your auto policy. If you currently pay for comprehensive coverage, the rate depends on how likely your vehicle is to get stolen.

The likelihood of vehicle theft varies greatly from state to state. So, your auto insurance provider carefully examines the vehicle theft rates in your location. They also factor in the make and model of your car and how often thieves target the vehicle type.

What to Do After Car Theft

First, call the police right away and give them as much information about your car as possible. Include details like the make, model, color, license plate number, and VIN number. Let them know if your car uses GPS tracking and the last place you saw it.

Then, contact your insurance provider and submit a claim within the first 24 hours of the theft. They’ll likely ask for a summary and description of any valuables left in the car when it got stolen. Examples include things like laptops, tools, and jewelry. 

Your insurance company will also need a copy of the police report, which is why you must contact the police first. Next, mentally prepare yourself for the possibility that you won’t get your vehicle back.

If you do get your vehicle back, make sure to thoroughly check it for damage and any missing parts. Check for any stolen goods like electronics and textbooks as well.

Also, make sure the thief didn’t leave anything illegal in your vehicle that you might get blamed for later. If you find anything suspicious left in your vehicle, notify the police right away.

Understanding Insurance and Car Theft

So, how does car theft affect insurance premiums? It likely won’t affect your rates much or at all if you only have liability coverage.

It’s important to note that items stolen from vehicles aren’t covered by auto insurance policies. For those items, you must go through your renters or home insurance provider. Consider adding an alarm or GPS tracker to your vehicle to prevent future theft.

Check out the rest of our blog for more insurance and security tips to give you peace of mind.