Vehicle theft rates in Canada are higher than ever. If you’ve had the unfortunate experience of your car being stolen, your first step should be to call the police and notify your insurance company. But what comes next? Will car insurance cover it? How long do you have to wait for your insurance payout? And what happens if your vehicle is recovered later? Let's find out.
Does car insurance cover theft, and how long do I have to wait?
Okay, let's answer the question you really want to know first—how long do you have to wait for the insurance payout if your car is stolen? Most insurance companies usually wait about 30 days before issuing a payout for a stolen vehicle, just in case the police recover it during that time.
Now, if your car gets stolen, whether you're covered depends on your specific insurance policy. To be protected against car theft, you’d need to have one of these three options:
Specified Perils
This covers your car from specific risks that are specified in your policy, like fire, weather damage, and theft or attempted theft, among others.
Comprehensive Coverage
Comprehensive car insurance covers you for losses or damages not included under collision coverage, such as all the risks from specified perils, plus extras like vandalism and falling objects.
All Perils
All perils insurance is a combination of both collision and comprehensive coverage, giving you full physical damage auto insurance coverage. With all perils, you're covered for everything except for any specified exceptions in your policy. The difference is that your deductible will be the same whether you have to make a comprehensive or collision claim.
Will a car theft claim affect my insurance rates?
It's likely, but not as much as you think. Depending on where you live, filing a claim for theft or vandalism could affect your rates, but it’s usually much less of an impact than filing a claim for an at-fault accident. So, while your rates might change depending on your province, don't let it stop you from making a claim.
What does the insurance payout process look like for car theft?
The insurance claim and payout process for stolen vehicles generally looks something like this:
Reporting the theft to the police
Report the theft to your local police department right away. Any delays can slow down the investigation and might impact your insurance claim. Be sure to give accurate details, like when and where the theft happened, and provide a thorough description of your car, including any unique features or modifications. Don’t forget to ask for a copy of the police report—it’s important evidence for your claim.
Contacting your insurance company
Once the police report has been made, you need to contact your insurance company to notify them about the theft and to start the claims process. Be ready to share details about what happened, along with information about your car’s make, model, insurance, and registration.
The investigation process
Once you've reported the theft and started the claims process, your insurance company will confirm you have the right coverage for auto theft and then launch an investigation into the theft. They will likely contact the police and verify the report. They may also send someone out to the scene to do a more thorough in-person investigation.
Make sure to fully cooperate with the investigation and provide any information they request as quickly as possible. This can help speed up their decision and potentially get your payout faster.
The decision and payout amount
As we mentioned earlier, most insurance companies will wait 30 days before issuing a payout, just in case the police recover your vehicle. If your car is found but has damage, your theft coverage will take care of the repair costs.
If your stolen car is not found, however, once the investigation wraps up and your claim is approved, your insurance provider will determine the payout. Since a stolen car is considered a total loss, you'll be paid the actual cash value of your vehicle minus your deductible. The payout process usually takes a few weeks, though the exact timing can vary.
Why does it take the insurance company 30 days (or more) to issue a payout?
Earlier, we mentioned that many insurance companies would wait 30 days to issue a payout to see if the police could recover the vehicle. While this is true, other factors like your coverage, the police report, and the investigation itself also come into play. Below, we will discuss these factors in detail:
Vehicle recovery
If your car is stolen and then found, the insurance company will first need to assess the damage and repair costs before finalizing the payout. This means they’ll arrange inspections, get repair estimates, and might even negotiate with repair shops, which can add time to the process.
If the repair costs are higher than the car’s actual cash value, the insurance company will likely declare it a total loss. This usually requires more paperwork and calculations, which could further delay the payout.
Your coverage
You need specified perils, comprehensive coverage, or all perils coverage in order to file a claim for a stolen vehicle. Basic liability insurance won't cover theft. These three coverage options all come with an insurance deductible. You’ll need to pay the deductible outlined in your policy before getting the payout, whether your car is recovered or not. If you have a higher deductible, it might take longer while you gather the funds to cover your portion, delaying the payout.
Also, some policies have specific deadlines for filing claims or extra requirements that could affect when you get paid. Be sure to review your policy carefully so you don’t miss any important steps that could delay the process.
The police report
If you wait a while to file a police report after your car is stolen, it can slow down the entire insurance process. The sooner you file, the faster the insurance company can start their investigation and work toward a decision. Plus, many policies have deadlines for an insurance claim, so you need to make sure you file a police report within that time frame.
They may also need to confirm the details of the police report with law enforcement, which can take extra time, especially if there are any backlogs or communication delays.
The investigation itself
If the theft involves violence, suspicious activity, or any unusual circumstances, the investigation might take longer and require more resources. This could mean interviewing witnesses, collecting forensic evidence, or working with different law enforcement agencies, which can extend the wait time.
Further, if your car was stolen from an unusual location, involved multiple vehicles, or needs a lot of evidence to be gathered, the process could take even longer as investigators work to collect and analyze everything.
How long does an insurance company have to investigate a claim in Canada?
There’s no set deadline for claim investigations in Canada, but insurance companies are expected to handle them in a reasonable and timely manner. Simple claims with few complications are usually resolved within a few weeks to a couple of months. However, if the claim is more complex, it could take several months or even longer to settle.
Does car insurance cover valuables stolen from my car?
If the items were physically attached to your car—like roof racks, a stereo, or tires—then yes, most auto insurance policies will cover the stolen items. However, you’ll only be paid for their actual cash value, which takes into account their condition and age. But if we’re talking about personal items you left in the car, like stuff left in the trunk or back seat, car insurance usually won’t cover those.
However, if you have home insurance, you might be covered for your stolen personal items. Home insurance often covers the replacement cost, meaning you’ll get a new item of a similar kind and quality for each thing that was stolen. Just remember, you’ll still have to pay your deductible.
But here’s a potential perk: if your car and home insurance are bundled with the same company and you’re filing claims for both at the same time for the same incident, you may only need to pay one deductible.
Tips to help protect your car from being stolen
Did you know that, on average, a car is stolen every six minutes in Canada? Yikes! But don’t let that scare you. There are plenty of ways to protect your vehicle from theft. Here are some top tips to help keep your car safe:
Park your car in a safe place
When you're out, park your car in a well-lit, busy area whenever possible. When you're home, park your car on your driveway or inside a locked garage if you have one. If you have two cars and a single-width driveway, park the least valuable one in the back to block the more valuable one. It also wouldn't hurt to install motion detection lights and a security camera that covers your parking area, that way if someone tries to steal your car, you'll hopefully catch it on camera.
Always lock your doors and windows
Always lock the doors. Be sure to close the windows and sunroof, too. And if you're just running into a store for a second, turn your engine off—don't leave it running unattended.
Also, avoid leaving valuables or personal information in the car. These can be tempting for passing thieves peeking into windows. Keep your glove box locked with your vehicle ownership inside. It’s also a good idea to get an electronic insurance slip from your provider so you don't have to worry about unlocking the glovebox if you need to show it.
Use anti-theft devices
A survey by CAA Insurance found that only a small number of people are using anti-theft devices. Just 6% use a steering-wheel lock, and only 8% use a Faraday box to block RFID signals. If your car has a wireless key fob, it’s a good idea to keep it away from your front door or use a Faraday box or RFID signal blocker to prevent thieves from remotely unlocking your vehicle.
Install an immobilizer
Most cars today are equipped with something called an immobilizer. It’s an electronic security device that only allows the engine to start if the right key is present. If your vehicle doesn’t have one, installing an immobilizer can make it much harder to steal, as it stops thieves from bypassing the ignition and hot-wiring the car.
Install a GPS tracker
Tracking devices can send a signal to the police or a monitoring service if your car is stolen. While a GPS tracker might not stop the theft, it can help locate and recover your vehicle.
Learn more today with BrokerLink
To learn more about how insurance payouts work, reach out to BrokerLink today. You can contact us by phone, email, or visit any of our locations across Canada in person. However you prefer to contact us, one of our licensed insurance brokers will walk you through the insurance claims process, including how to file a claim and how it may affect your insurance premium.
As car insurance specialists, BrokerLink can also help you find the best comprehensive insurance policy for your needs at the best price. We also offer free quotes to all drivers. Use our online quote tool or give us a call today to find out more.
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