General Question

delta77's avatar

Is there such a thing as auto theft insurance?

Asked by delta77 (196points) May 19th, 2010

I recently bought (financed) a new Honda, and I was thinking: what happens if the car gets stolen? Am I still on the hook for the loan? Is there such a thing as auto theft insurance in case my financed new car were to get stolen?

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9 Answers

lillycoyote's avatar

That’s what comprehensive auto insurance does, as opposed to just liability insurance. It protects you against theft, among other things.

jaytkay's avatar

Yes, normal comprehensive auto insurance covers theft. Your lender probably requires it.

At some point, the replacement value of the car becomes low enough that it makes sense to drop comprehensive and just carry the minimal collision insurance.

SeventhSense's avatar

As mentioned you’re covered from all loss of value to the vehicle including a total loss under a comprehensive policy.

lillycoyote's avatar

But @jaytkay is right. The lender/lien holder will require you to have comprehensive insurance most likely, and you will want it too, because if the car is stolen or totaled if you don’t have comprehensive insurance you will still have to make the payments on the car until the loan is paid off and wouldn’t that be depressing? To keep paying on a car you no longer had?

perspicacious's avatar

Yes, it’s part of comprehensive coverage through your auto insurance company.

BoBo1946's avatar

Don’t worry, if you have a loan on the car, there is auto theft insurance (under comprehensive coverage). The bank will make sure of that!

SeventhSense's avatar

The bank has a definite interest. After all it’s their car until you pay it off.

njnyjobs's avatar

Even if you have comprehensive insurance you will still be liable for some amount of your loan when you’re upside down, meaning you owe more than the value of the car.

For this you may want to look at another insurance coverage called GAP Insurance. This provides coverage for the difference in the balance of the loan amount and the actual loss payment from a comprehensive policy. Let’s say you’re one of the most preferred customers with a credit score of over 750 and the bank financed your $25K automobile purchase with little or no downpayment. As soon as you drive that vehicle out of the lot, the value of the vehicle may very well be $22K, so if that vehicle got totalled, insurance would pay for $22K and you’re still liable to the bank for the $3K, aside from the deductible.. Gap Insurance will cover that $3K difference if you have one.

Paydaydirect's avatar

Check your present car insurance if you have any , most of the insurance companies provide theft insurance too.

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