This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Is A Stolen Car Covered If The Thief Isn't Caught?

Question: Will my insurance pay for repairs (less deductible) for my fully covered, financed vehicle if it were reported stolen and then hit a tree, but no one has been charged with the theft?  Or does the thief have to be found? I'm in Texas, in case it varies by state.

Answer: Yes, your insurance should pay for the repairs. But expect to be grilled about the claim -- and don't take it personally.

Auto insurance companies will pay for the repairs of a recovered stolen vehicle, minus your deductible, if you have comprehensive coverage on your policy -- no matter if the thief is found or not. But, as the Texas Department of Insurance stresses, you do need to report the auto theft to the police to get your claim accepted.

In your situation, your insurer's investigator will do an intense examination of your claim to make sure you didn't crash your own car and then report it as stolen (because you were drunk, didn't want to make a collision claim, owed too much on the car, etc.).  Also, he will check for any unauthorized use, such as if you have a child who may have gone on a joyride, crashed into the tree and then left the car (this happens more than you think).

Your claim for your stolen vehicle will be scrutinized by your auto insurance company because fraud is widespread with both theft and fire claims. The National Insurance Crime Bureau (NICB) says fraudulent claims are especially common in hard economic times, so auto insurance claims investigators are meticulous in their inquiry to determine if a vehicle has really taken by a thief or if something else occurred.

Once your insurer has thoroughly investigated your claim and determines it's legitimate, then your repairs should be covered (less your comprehensive deductible).

If repair costs for your financed vehicle are high, compared to the worth of your car, your insurer may decide to total out the vehicle instead of repair it. If that is the case, then actual cash value (ACV) would be paid out for the vehicle, but to your lienholder and not you (unless you owe less than the value of the vehicle, in which case your lienholder would be paid off first and you'd received any remaining settlement money).

If you're upside-down on your loan, owe more than the vehicle is worth, then after the ACV was paid out, you'd be responsible to pay the remaining balance due on the loan unless you have gap insurance to cover this amount.

While many issues with car insurance vary by state, how stolen cars are handled typically does not. No one has to be charged with theft in order for you to make a claim or for you to get your claim paid out by your auto insurer. State laws do, however, vary on how long an insurer can take to pay out a claim.

In some states auto insurance companies are allowed to settle within a very subjective “reasonable time,” but Texas has laws that set deadlines for car insurance carriers to take action after you've filed a claim. Insurance companies must:

  • Respond within 15 days of the date they received your claim (in writing). Part of this will be you documenting your loss.
  • Accept or reject your claim within 15 days after you submit any requested documentation.
  • Send your payment (check or draft) within five business days after it agrees to pay your claim.

However, Texas laws also allow for extenuating circumstances. If an insurance company cannot meet the above deadlines, it must send you a notice explaining why. The insurer then has 45 days to either approve or reject your claim. If a claim is ultimately rejected, your insurer must explain why in writing.

If after your claim is paid the car thief is found, your insurer has the right to pursue that individual to recover whatever they paid out on your claim.


Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,081.17 +50.96 0.28%
S&P 500 2,092.04 +10.16 0.49%
NASDAQ 4,813.4340 +39.9620 0.84%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs