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Will Your Car Be Covered If It Is Stolen?

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When it comes to buying auto insurance, you are likely concerned about what will happen if you hit another driver and need to pay for the damages. However, there are other things that can happen to your car that are completely out of your control, such as if your car is stolen. Here is what you need to know about the coverage you need to protect your vehicle in this situation. 

Comprehensive Coverage

You'll want to look into getting comprehensive coverage through your auto insurance provider to ensure that you are protected if your vehicle is stolen. Comprehensive coverage is designed to cover accidents that are not due to a collision, which includes natural disasters, fire, vandalism, and theft. You're not typically required to have this type of coverage unless your auto loan lender requires it. Otherwise, you're taking the risk if you need the coverage.  

The key thing to know about comprehensive coverage is that it will only pay up to the actual cash value of your vehicle. This means that if you bought your car for $15,000 and today it is only worth $7,000, then your insurance provider will only pay out the current value of your vehicle. This is quite different from home insurance, which pays to replace damaged items with a similar item that you were to buy new today.

If your stolen vehicle is not recovered then you will receive the actual cash value. If it is recovered, the insurance provider will only pay for repairs up to the actual cash value as well. If you have more repairs than the vehicle's value, then the vehicle is considered totaled and you can use that money toward purchasing a new vehicle. 

Home or Renters Insurance 

Your auto insurance policy is going to cover the vehicle itself, but it will not cover the personal property in it. That's where a homeowners or renters insurance policy will help. If you had items in your car that were stolen, you would need to make a claim with your homeowners or renters insurance to replace those items. This means paying another deductible just to cover the items that were stolen. 

If you have a low deductible for your homeowners or renters insurance, then it may make sense to use it to replace anything that was stolen. However, a high deductible could be more expensive than the stolen items in your vehicle. 

Contact a local auto insurance service to learn more.