Will My Car Insurance Pay For A Stolen Vehicle

Reader’s Question:

If my car gets stolen here in Louisiana, and I haven’t paid the full loan yet, will my automotive insurance pay off the remaining balance?

Philip,

Metairie, LA

If your vehicle gets stolen, the first thing that you should do is to report it to the police and to your auto insurance company there in Louisiana. A claim will be placed under your physical damage coverage, specifically under the comprehensive portion.

If your vehicle is not recovered, the automotive insurance company would have to settle with you the actual cash value (ACV) of your vehicle. The ACV is the amount that should be paid in order to replace the lost item or property (depreciation allowance and deductible considered). This value is determined by comparing the condition of your vehicle with those of other vehicles. The input of local auto dealers and other private parties may be considered in determining this cost, as well as the condition of your vehicle and the mileage differences.

The actual cash value of your vehicle may be computed manually or through the help of computerized evaluation processes. Most auto insurance companies use third party computer programs (such as the CCC) to assist them in estimating the costs of damage claims. This computer program provides the auto insurance company with an updated database that is used as a yardstick to determine the true value of your vehicle based on the evaluation of repair shops and auto dealers.

Once the actual cash value of your vehicle has been determined, this amount will be settled by your auto insurance company and will be paid out to you.