Homeowners Insurance

How Are You Covered If Thieves Steal Holiday Gifts From Your Car?

With trees lit and wreaths hung, everybody now knows that the holidays are here—including thieves. These so called grinches target shopping mall parking lots, and even your own driveway, searching for expensive gifts to lay under their own Christmas trees.

Each year, more than $1 billion in personal items are stolen from car break-ins, in nearly 2 million thefts. A significant portion of those thefts occur between Thanksgiving and Christmas, as busy holiday shoppers rush to finish their Christmas shopping. Take, for example, Marci Moriarty who had her car broken into while it was parked in her quiet cul-de-sac. In her car, Marci had more than $1,500 worth of toys, coats, and gift cards she had bought to provide a special Christmas morning to ten cancer patients who had been admitted to a local children's hospital. Unfortunately, a thief spotted the items through the car window and made off with the gifts.

Typically, thieves favor discreet areas with plenty of potential targets, such as parking garages. There, dozens of car break-in can occur in a matter of minutes, and unless cameras or witnesses can identify the thief, you stand little chance of having any stolen items recovered.

People often assume their auto insurance will reimburse them for the cost of items stolen from their cars. Unfortunately, that’s a misconception. Even if you you have comprehensive car insurance, your policy will cover only the theft of items that were a permanent fixture of the car—such as seats. Any items stored inside the car, such as gifts, will not be covered.

Your insurance provider, however, may reimburse you for damage done directly to your car during a gift grab, such as replacing a smashed window, after you've satisfied your policy's deductible.

Fortunately another form of insurance may cover the cost to replace your gifts—albeit, again, after a deductible is met. Most homeowners or renters insurance policies cover the theft of personal items, even if those items weren't physically in your home when they were stolen. An Allstate agent, for example, confirmed that, typically, "off-premises theft is included with your renters [or homeowners] policy—contents will be covered worldwide [for] 16 perils (fire, theft, explosion, etc.)."

However, the deductibles you'll need to meet before your insurance provider steps in to offer any reimbursement will likely put a crimp into your plans. With those deductibles typically ranging between $500 and $1,000, the value of the stolen gifts would need to be high indeed before filing a claim would make much financial sense.

Say, for example, that you had $250 worth of personal items stolen from your car, but you had a $500 annual deductible on your renters insurance policy; you wouldn’t get reimbursement from your insurance provider—unless you've already paid more than half of that $500 deductible earlier in the year. On the other hand, a claim might be worth considering, at least, for a pricier theft, say of a host of expensive electronics items, such as laptops.

If you do file a claim with your insurance company to seek reimbursement, keep in mind that doing so might trigger a rise in premiums in the future. Unless you stand to be reimbursed a substantial amount after the deductible is met, then the smartest financial decision might be to pay for the loss yourself.

Daniel Caughill

Daniel is a Staff Writer at ValuePenguin, covering insurance, retirement and other personal finance topics. He previously wrote about compliance and best practices for K-12 school districts at Frontline Education.

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