A client texted me early Monday morning letting me know his car was broken into overnight. The good news was his car wasn’t stolen. What was stolen, though, was his wallet, watch, possibly his passport, a ring, and a few other items. His question was, did his car insurance policy cover this? He has “full” coverage policy on his car which results in a yes and no answer. Let’s look at the reasoning behind the two answers.
Yes: If the car were damaged during the break-in, such as a window being broken or the door bent from the use of a crowbar, then yes, his car insurance policy would have covered repairs for the damage less the deductible. Comprehensive coverage, which he has, covers vandalism to a car, as well as a broken window or windshield.
In his case, the driver’s window was left cracked open allowing the thief to easily unlock the car and enter it. Since no damage was done to his car, there is no need to file a car insurance claim. Filing one would result in a $0 paid claim which may make it difficult to move him to another carrier who may provide a better rate.
No: The contents which were stolen from his car are not covered by his car insurance policy. They are covered under a home or renter’s insurance claim. Surprised? Most people are very surprised when I share that with them.
The majority of insurance companies who write home, renter’s, and condo insurance, provide some coverage for personal property, or contents, off premises from the home. Usually it’s about 10% of the amount of contents coverage on the policy and it covers personal property in your car, while traveling, and even in a storage unit or facility.
The items taken from my client’s car, are considered personal property or contents off premises. The issue is whether such a loss exceeds the home / renter’s insurance policy deductible? In most cases, it doesn’t. Further complicating the issue is my client doesn’t have renter’s or home insurance since he’s living with his fiancé. Her policy probably doesn’t cover it either as she does not have an insurable interest, or ownership, in the stolen property.
What happened to my client is unfortunate. He appreciated our discussion even if he didn’t like the answers. It serves as a great reminder for all of us to not leave a purse or wallet with our driver’s license, credit and debit cards in it. Never leave your social security card or passport in your car as these two documents can lead to a stolen identity more quickly than just your driver’s license. Always lock your car and put anything of value into the trunk.
The good news for my client is the thief didn’t discover the expensive set of golf clubs in the trunk! What’s in your car you need to take out today? Share that with me, along with your comments, questions, and experiences on my Facebook, Google +, and LinkedIn pages. I’d love to hear from you!