What happens if stolen car is found after insurance payout

Every 45 seconds, a car is stolen in the United States. Being a victim of car theft is daunting. To help save your pain, you can file a cash settlement or brand-new car depending on your insurance policy coverage if you have car insurance. 

But what happens if, out of nowhere, your stolen car turns up somewhere? Although this doesn’t happen often, it’s important to know how your insurance company can handle such a case.

This post discusses the type of insurance that covers car theft and what happens when a stolen car is recovered during and after a settlement.

Does Car Insurance Cover Vehicle Theft?

Yes, car insurance covers car theft if you have a comprehensive insurance policy. Third-party only or collision insurance doesn’t provide coverage for car theft. 

Comprehensive insurance coverage will also help replace certain parts of the car or car modifications if they’re stolen, depending on the terms of your policy.

However, comprehensive insurance does not cover the contents in your car, such as your belongings. Instead, these are covered by renters or homeowners insurance.

What Do I Do If My Car Is Stolen?

If your car is stolen, the best thing is to file a claim to your insurance company for a settlement of compensation. But before you file the claim, you can do the following:

1. Counter-check to make sure it’s really stolen. Unless it’s been stolen from your garage at home, perhaps you’ve just forgotten your parking spot. If you’re behind payments, confirm that it is not repossessed. Also, check whether the car was impounded or claimed by a creditor. There’s also a chance that it’s just been towed. So you can also check the police impound before you report a stolen car. 
2. Call the police and report the incident. If the car isn’t on your parking spot and it’s also not towed, call the police and report a stolen car. Give the police as much detail about the car as you can, including make, model, color, type, and where it was parked last.
3. Call your car insurance provider or agent and report your car stolen. Make your insurer aware that you’re no longer in possession of your vehicle. Share with them as much detail as possible about everything you can remember before the theft occurred.
4. Report to your state’s DMV. Although you’ve filed a police report, the DMV maintains a database of stolen cars. The DMV also works with the police to return a recovered car to the owner.
5. File an insurance claim with your insurance company. Once you’ve reported the stolen car to all appropriate authorities, you can file an insurance claim if you have comprehensive coverage. 
6. Help with the search. When your car is stolen, the best you can do after reporting is to help with the search. You can try searching for it online, in places such as Craigslist and other aftermarket car sales communities. This might be a long shot, but finding your car listed for sale online is possible.

How To File An Insurance Claim For A Stolen Vehicle

Fact: A comprehensive insurance policy doesn’t guarantee that the insurer will give you an immediate payout. There could be delays, and this will require both action and patience. 

After filing a claim, allow them to investigate the theft. The insurer has to first rule out fraud before paying the claim.

Most insurance providers impose a waiting period. This period can be anywhere between two and eight weeks, depending on the insurer. The waiting period is imposed to see whether the car can be recovered before paying out a claim.

The insurer will also send an adjuster to walk you through the policy and make you understand what type of compensation you’ll qualify for and how much.

If everything checks outright, you may qualify for a total loss claim. Your insurance company will settle with you and reimburse you for the total actual cash value (ACV) of the car less the car’s depreciation and your deductible. 

Note: The ACV is negotiable. Since the adjuster will begin at the car’s low-end value, carry out enough research and don’t fear negotiating. 

What Happens If My Car Was Stolen And Recovered?

Generally, if your car is stolen, there’s always a chance it will be recovered after you report to the police. How would your insurance company handle the situation?

There are two scenarios: 

You need to contact your insurer immediately if your car is recovered during the claim process. The insurance company will halt the claim process immediately and assess the car for damage. 

If the car sustains any damage, the insurer will cater to repair costs. If the insurer declares the car a total loss, you will get a payment for your car’s actual cash value as you’d have gotten if the car stayed stolen.

Whether for repair or total loss, your deductible will apply during payment, and the insurer will deduct it from your claim payout.

Now, can you get an anti-theft discount?

Yes, it’s possible to get an anti-theft discount. Most insurers encourage policyholders to have anti-theft devices like alarms and tracking systems and offer discounts to those who have. 

   2. If The Car Is Recovered After Claim Settlement

If your stolen car is later recovered after the claim has been settled and you’re paid, it becomes the insurance company’s property. The insurer will designate the car as a salvage title.

Like you’d do before the claim process was settled, first, report to the insurer that the car has been recovered. The insurer will send a team to retrieve the car. 

If you’re still interested in the same car, your insurer may give you an option to buy it back. The procedure to re-own the car varies from one insurance company to another or case-by-case, so it’s best to ask your insurer about your options.

Who Owns The Items Inside A Recovered Vehicle?

As we’ve said before, a car insurance policy doesn’t cover personal belongings inside your car. You’d need renters or homeowners insurance to claim these items, including items stolen inside your car during car theft.

If your stolen car is recovered, the items inside the car are still yours. Even if the recovered car is now the insurance company’s property, they stay yours.

Your car policy may only pay for the cost of your car’s custom parts or modifications like stereo system, rims, alarm, etc. But this may only happen if you have custom parts and equipment (CPE) coverage and depends on your insurer. 

So, before the insurer possesses the car, you need to take all your belongings from the car. If any items are missing, report to your renters or homeowners insurance carrier for compensation. If you bundled your car insurance and homeowners’ or renters’ insurance, you could be lucky to file the claim in the same place. 

Final Word 

If your car is stolen, first report the incident to the police, then file a claim with your insurer. As long as you carry comprehensive coverage, car theft is covered, and you should receive reimbursement. If the car is recovered later, after the insurer has settled the claim, it remains the insurance company’s property.