New data shows car theft is on the rise - here's how car insurance can help (2023)

Car thefts are on the rise in the US.National Insurance Crime Agency(NICB) more than a million cars were stolen in 2022. Thefts increased 7% in 2022 compared to 2021, making last year one of the worst since 2008.

NICB advises drivers to ensure thatCar insuranceThe policy is in force, but don't assume your policy will cover your stolen car.CNBC selectionexplains why you need comprehensive auto insurance to protect against theft and what steps you should take if you are the victim of car theft.

With the exception of New Hampshire and Virginia, all states require you to have auto insurance in order to drive. But chances are you'll need more coverage than the law requires if you want to get reimbursed for your stolen car.

Most policies that meet legal requirements offer some liability coverage, which is a type of insurance that may cover other people and property that are damaged if you are involved in an accident through your fault. Specifically, this coverage does not cover damage to your automobile that is not related to an accident, such as: B. Theft.

This is where comprehensive insurance coverage comes into play. This type of coverage is not required by law, but it can help you if your car or parts are stolen, and even covers damage from natural disasters, vandalism, and dropped objects.

Comprehensive auto insurance is usually more expensive than other policies. You can save some money by using companies that offer discounts on their policies. One of CNBC Select's top picks,farmer insurance, make coverage cheaper with 22 discounts on car insurance. You can get these discounts through a variety of promotions, such as: B. through safe driving, paperless billing registration and more.GeikoAlso ranked best auto insurance company for affordable coverage, offering low average premiums for comprehensive coverage.

If you rent a car, you must pay with aCredit cardthat offersPrimary rental car insurance coverage. This covers the theft of a rental car and allows you to file a claim directly through your credit card insurance provider without first filing with your own auto insurance company. For example, himReserva Chase Sapphire®offers primary rental insurance that covers up to $75,000 in damages caused by accident or theft for rentals up to 31 consecutive days.

Here are the steps to take if you discover a pile of broken glass where your car was parked.

• Report to the police:Contact the police and file a complaint with them as soon as possible. Make sure you have the vehicle identification number (VIN), title information (if available), and photos or additional information about the car that can help authorities identify it.
• Notification of damage to your health insurance company:You can quickly start this process online with almost any insurance company. You will need a copy of the police report and a list of all items found in the vehicle.
• Play the waiting game:After a claim is filed, insurers typically have a 30-day waiting period to see if the car is found before paying.

If the vehicle is still not found, you will likely receive a payment equal to the actual present value (ACV) of the car minus your deductible (the amount you must pay before coverage begins).

It is important to note that AVC is not what you paid for the car. Rather, it's a fixed replacement value (generally equal to what you'd have to pay to buy the same or similar model) minus depreciation on the car.

An example of actual cash value

You bought a car for $40,000 five years ago. In the last five years, the value of the car has decreased by $10,000. However, the price of buying a new car of the same model has increased by $2,000. The actual present value of the car is the cost to replace it ($42,000) minus its depreciation ($10,000) or $32,000.

It is possible to obtain coverage at an additional cost that would pay the price of a new vehicle, called New Vehicle Replacement coverage. While not all insurers offer this, some do for certain newer cars, includingfarmers,nationwideYAllstate.

You should also be aware that items in your stolen car may not be covered by your auto insurance. However, these items may fall under yourspension insuranceohomeowners insurance. And if you bought any of these items with a credit card offerpurchase protection, you may be able to get some money back through your card.

Even if you have comprehensive coverage, it's not ideal if your car is stolen. While comprehensive coverage could help you repair or replace a stolen vehicle, you still have to pay the deductible. Taking steps to make sure your car isn't attacked can save you time and potential headaches.

Fortunately, there are a few things you can do to prevent this from happening. NICB recommends parking in a garage or in a well-lit area. For those with cars parked in a driveway, the NICB also suggests investing in motion detectors to deter would-be thieves.

A steering wheel lock bar can fit into the steering wheel and prevent it from turning and can be purchased for $25 to $50.

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