The only thing worse than having your car stolen is having a car stolen that you’re still paying for. If you’re ever in the situation where you think your finance car has been stolen, it’s important not to panic!
You’ll need to inform the police and your insurance company as soon as you're sure your finance car has been stolen, and then tell your finance company too.
Should there be a payout, the insurer will first make payment to the legal owner of the vehicle, which is the finance company.
If there’s any money left over, that will go to you.
What should I do if my finance car is stolen?
It can be a really horrible experience to have your car stolen, especially if you’re still in the process of paying off your car finance. There are a couple of steps you need to follow if you ever find yourself in this situation.
Report the stolen car to the police – this is the first thing you should do, but you should usually use a non-emergency number to report the crime unless the crime is still in progress. The police will then provide you with a crime reference number and inform the DVLA.
Get in touch with your insurance provider – you can pass along the crime reference number that the police provided you with, and this will help get things moving with your case. If your car is recovered and your insurance company has already paid you the settlement amount, the insurer will take ownership of the car. On the other hand, if your car is returned to you and the insurance company hasn’t paid yet, you need to let them know immediately.
Once you’ve let the police and your insurance company know of the theft, you should pass the same details onto your finance company. You’ll still have to keep up with your finance payments while your case is being handled. If your stolen car is never recovered, your insurer will settle with the finance company. If there’s any money left over, it will be paid to you.
If your insurance company pays out a claim for your stolen vehicle, you have to let the DVLA know it’s been sold to the insurance company. You can let it know online or fill in the yellow ‘sell, transfer or part-exchange your vehicle to the motor trade’ section of your vehicle log book (V5C). Send the perforated section to the DVLA along with a letter including your insurance company’s details and when the payment was accepted. The rest of your V5C goes to your insurance company.
What is gap insurance?
If you’re worried about having your finance car stolen, you may consider taking out gap insurance.
When an insurance company gives you a payout for a stolen car, this amount will be based on the current market value of your vehicle, so that could mean it might not cover the full amount that’s left to pay on your finance agreement.
Gap insurance will usually cover the difference between the insurer’s valuation of your car and the amount you originally paid.