What happens if your car gets stolen on finance?

    Car theft is a headache and can put your life on standstill. And if your car is stolen while you’re still paying off the finance, it can create an even more complex situation, with financial and legal implications. 

    If your financed vehicle is stolen, you’re still responsible for the remaining payments in most cases. However, your insurance coverage and the terms of your finance agreement can impact your options and responsibilities. 

    Steps to take if your car is stolen

    someone breaking into a car
    After your car is stolen, you should immediately call the police.

    If your car is stolen, take action immediately. It is essential that you inform the police, your insurance company, and your loan provider about the theft to resolve the situation as quickly as possible and prevent additional complications.  

    Contact the police

    When your car is stolen, the first thing you should do is contact the police. Reporting a theft provides an official record of the incident, which is essential for insurance claims and legal proceedings. 

    To report your car as being stolen, you will need to share as much information as possible, including: 

    • Vehicle details – make, model, year, colour, vehicle identification number (VIN), registration number, and any distinctive features or modifications
    • Date, time, and location of theft
    • Circumstance of theft – any suspicious activities or individuals seen before the theft; details of how the theft occurred, such as forced entry or keys left in the ignition
    • Insurance information – provider contact details, policy number, and coverage details
    • Personal details – your full name, contact information, address, and the names of anyone else authorised to use your car
    • Additional documentation – proof of ownership, such as the V5C logbook, finance agreement paperwork

    All of this information will assist law enforcement in their investigation. The more information you share, the more the chances of recovering your vehicle increase. Additionally, reporting car theft helps authorities track patterns of car burglaries and theft in your area, and may prevent similar incidents in the future.

    Contact your insurance company

    Notifying your insurance company as soon as your car is stolen is crucial as it initiates the claims process. Most insurance policies have specific timeframes within which thefts must be reported to be eligible for coverage. Failing to report the theft promptly could lead to complications or even denial of your claim.

    By reporting the theft promptly, you also mitigate the risk of being held liable for any damages or incidents involving the stolen vehicle after the theft occurs.

    Additionally, your insurance company may be able to offer assistance and guidance in navigating the aftermath of the theft effectively.

    Generally, you can expect to receive a decision from your insurance company regarding your claim. If your claim is approved, the next step is to work with your insurance to process any settlements or reimbursements. If your claim is denied, review the reasons provided and explore any appeals or dispute resolution options available.

    Contact your car finance company

    a man on a phone

    Prompt communication with both your insurance provider and your car finance company are essential after a car theft.

    It’s essential to keep your finance provider in the loop due to legal obligations and contract requirements. 

    Like with your insurance, your finance agreement likely mandates that you notify the finance company immediately in the event of theft or damage to the vehicle. Failure to do so could result in penalties or breach of contract, impacting your financial standing. 

    This is especially important if your car is on finance and you have outstanding loans, as your rates could increase.

    Potential financing impacts of a stolen financed car

    Failure to report the theft to your finance company could leave you responsible for the outstanding balance on the loan. This is true even if the vehicle is never recovered, and can result in additional financial strain and affect your credit rating.

    However, informing your finance company of the theft enables them to coordinate with you on recovering the outstanding balance of your loan. They may offer options such as restructuring the loan or assisting with insurance claims to mitigate the financial impact of this loss. 

    It is essential to contract your financing company immediately to sort outstanding payments as soon as possible after the car theft.


    Do you still have to pay finance if your car is stolen?

    Yes, you’re generally still responsible for finance payments if your car is stolen, unless your insurance covers the outstanding balance.

    Will my car insurance pay out if my car is stolen?

    Car insurance typically covers theft, reimbursing you for the vehicle’s value minus any deductible. However, check your insurance terms for more accurate information.

    Do you get a courtesy car if your car is stolen?

    Whether you receive a courtesy car after theft depends on your insurance policy. Some policies offer this benefit, but it’s not universal.

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