Learning that your car has been stolen can be a highly distressing experience. However, the situation takes a complex turn when your stolen vehicle is unexpectedly recovered. This article delves into the intricacies of car theft and its aftermath, focusing on the critical role of car insurance. We’ll explore how insurance policies come into play during these incidents, the legal processes involved in recovering a stolen vehicle, and effective preventive measures to safeguard against future thefts.
Understanding the Impact of Car Thefts in Canada
Car theft is a significant issue in Canada, with a staggering financial and social burden. This unsettling experience affects many Canadians, with a vehicle stolen every six minutes in the country. In 2021 and 2022, Toronto alone reported around 6,000 and over 9,000 vehicle thefts, respectively. The situation got even worse in 2023. In the first 9 months of the year, there have been 9,747 reported vehicle theft cases in Toronto. Furthermore, our internal data study established that online searches for information on how to steal a car increased by a staggering 84% since 2020.
The rise in car theft not only inconveniences drivers but also strains police resources and impacts insurance costs. The correlation becomes obvious when you see that Vaughan, Ajax, Brampton, Mississauga, Toronto and Hamilton are not only in the top 10 most expensive cities for car insurance, but they are actually all well above the provincial average for carjacking rates.
Does Insurance Cover Car Theft?
If your car is stolen or vandalized, coverage depends on your insurance policy. To be insured against car theft, you need to have chosen one of these three coverage options:
- Specified Perils Coverage: Covers specific risks like theft or attempted theft, fire, hail, windstorms, and others.
- Comprehensive Coverage: This coverage protects your car from risks not related to collisions, such as vandalism, theft, and fire.
- All Perils Coverage: This is a comprehensive option that combines the benefits of both Collision and Comprehensive coverages, offering extensive protection for your vehicle.
Additionally, some policies may reimburse the cost of renting a vehicle while yours is unavailable.
What Happens When a Stolen Car is Recovered?
When a vehicle is stolen and then recovered, several legal and insurance processes come into play. Firstly, it’s essential to file a detailed theft report with local police, including the car’s make, model, and license plate number. If the car is equipped with a GPS or Tag tracking system, it can aid the police in tracking and recovering the vehicle.
Upon recovery, you’ll need to confirm your ownership of the car and the police will record its condition and impound it for evidence preservation. The investigation process, potentially involving court proceedings, can be lengthy.
Once resolved, you must prove ownership and pay any related fees to reclaim your vehicle. Be prepared to handle any repairs or maintenance to restore it to its original state.
What If Your Car is Found Before an Insurance Payout?
Most insurance companies in Canada have a waiting period before settling a claim for a stolen vehicle to see if the police are able to locate the vehicle. If you have comprehensive car insurance, you’re likely covered for the repair costs of a recovered vehicle or the fair market value if it’s not found. However, the specifics vary among policies, so it’s crucial to understand your coverage.
If your vehicle is found before the insurance claim is finalized, the insurer will evaluate the damage. Should the damage be fixable, they will cover the repair costs before returning the vehicle to you. In cases where the vehicle is irreparable, or if it isn’t found within the stipulated waiting period, the insurance company will declare it a total loss.
What If Your Car is Found After an Insurance Payout?
If your stolen car is found after you’ve received an insurance payout and the case was closed, the recovered vehicle typically belongs to the insurance company. It’s crucial to contact your insurer immediately upon recovery, as the car’s ownership would have transferred to them after the payout.
Preventing Car Theft: Tips and Strategies
While no method guarantees complete protection against car theft, certain strategies can significantly reduce the risk:
- Secure Your Vehicle: Always lock your car and never leave it running unattended. Use steering wheel locks and install alarm systems for added security.
- Smart Key Fob Storage: Store key fobs in signal-blocking containers to prevent thieves from copying their codes.
- Parking Safely: Choose well-lit, public parking spaces to deter thieves. Another thing you might want to consider is parking insurance which will provide coverage if your car was stolen when stored or off the road.
- Theft-Deterrent Devices: Consider installing devices that prevent reprogramming of your car’s onboard diagnostic system.
The Bottom Line
The recovery of a stolen car brings a mix of relief and new challenges. Understanding the legal and insurance aspects of such an event is crucial for navigating the situation effectively. By taking proactive steps to secure your vehicle and being aware of your insurance coverage, you can mitigate the impact of car theft and recovery.