Eagle Eye Contents — Winter 2005

Vehicles are Being Stolen!

The National Insurance Crime Bureau is aware of numerous vehicle thefts occurring throughout the Province of Quebec, Canada recently. There are indications that U.S. vehicles – particularly Sport Utility Vehicles (SUVs), late model pick-up trucks, high-end motorcycles, campers, motor homes, and off-highway recreational vehicles (OHRVs) – are being targeted by auto thieves in Montreal, Quebec City, and other places throughout the province.

Most often, American insureds visiting Canada are having their vehicles stolen from locations while parked at hotels or inside parking garages or parking lots. The NICB is working with appropriate Canadian officials in an effort to reduce such thefts; however, NICB urges its member companies that write policies in Northern New England to advise their policyholders of the auto theft problem described above.

Diminished Vehicle Values Not Covered

The vehicle has been repaired, but the market value is less because it was in an accident. The damage was extensive but not enough to be a total loss. The body shop did an excellent job on the repair. You decide to sell it and the buyer asks, “Has it been in an accident?” The buyer may still be interested but the value is less because it is not in “original” condition, thus the value is diminished. Does your insurance policy pay you for this reduction in value? The answer is no. In 43 states, New Hampshire and Vermont included, policy language excludes coverage for diminished value. Only Georgia, Hawaii, Kansas, Louisana, Maryland, Massachusetts and North Carolina don’t allow policy language to exclude it.

Auto Loan/Lease Gap Coverage

You buy or lease a new vehicle and you don’t put very much money down as a payment initially. Your vehicle is in an accident and considered a total loss. Because new vehicles depreciate so quickly, the actual cash value of the vehicle after the total loss is now less than the amount you owe on the loan or to pay off the lease, you will have a “gap” and you will have to pay the difference out of your own pocket. There is a simple solution. An inexpensive endorsement can be added to auto policies that will cover the “gap.” Because we are not privileged to the financial details of your transaction, we will not know if a “gap” is a possibility. Be sure to let us know if this situation occurs the next time you buy a new vehicle and we can add the “gap” coverage to your policy.