What happens if your car is stolen and burned? Does the insurance pay for it all?

Question

Even if you owe more to the bank?

It has full coverage

Answer 1

If you have theft coverage, the insurance will pay the actual cash value of the vehicle, to both you and the bank. If you owe more than the actual cash value, then you still owe the bank the difference between the insurance payment and the loan payoff.

Answer 2

Okay, insurance will give you what the car is currently worth NOT what you owe. They will also subtract the deductible from this amount. If you're upside down on your car payments. Meaning you owe more than the car is worth, than you need a special coverage to pay that difference. It's called GAP insurance.
It works like this:
Car is worth: $22,000
You owe: $27,000
Your comp. coverage will pay: $22,000- your deductible
If you had GAP coverage, it would pay the remaining $5,000

Hopefully, you're using this scenario as an example and it hasn't actually happened. If it hasn't I would check into getting GAP coverage on the vehicle. It's very affordable through your auto insurance provider.

Answer 3

The insurance company is liable for what the car is worth. They will give you (or the bank) that amount. If you owe more to the bank you are responsible for that portion of it.

Answer 4

The only way you won't to have pay any difference if you owe more is if you purchased gap protection when you bought the car. That will actually pay the difference between actual value and what is owed.

Answer 5

Yes your insurance is suppose to pay for it, if a police report show that it was reported stolen they should be paying it off minus your deductible, I would talk to a lawyer to make sure the insurance company doesn't try to screw you, they will try.