Does Your Auto Insurance Policy Cover Your GPS?

If you’ve recently gone somewhere on vacation and your car did not have a Global Positioning System (GPS), you probably wish it did. GPS systems have become increasingly popular as their prices have dropped. Navigationally challenged drivers who used to decipher hard-to-read maps can now rely on these small devices to help them reach their destinations. However, the popularity of GPS devices makes them particularly attractive to thieves. They are also susceptible to damage in car crashes, like any other item in a car. How will an auto insurance policy cover a stolen or damaged GPS?

Unfortunately, standard policies provide little or no coverage for a GPS. Many older policy editions explicitly state that they do not cover losses to any electronic equipment that receives or transmits data signals. A GPS would seem to fall within that description. More recent policy editions do cover electronic equipment, but only if it is permanently installed in the vehicle. These policies provide a small amount of insurance for electronic equipment; $1,000 coverage is typical.

It is possible to buy additional coverage for GPS devices. Any car owner with equipment worth more than $1,000 should speak with her insurance agent about buying a special policy form. It increases the coverage to a specific amount shown on the form. Typically, insurance companies will not offer more than $5,000 coverage.

If the policyholder has an older edition of the policy, she will need a different form to cover a GPS. This form covers sound reproducing equipment; audio, visual and data electronic equipment; and tapes, records and disks while in a vehicle. A GPS device falls within the data electronic equipment category. Coverage applies if the unit is permanently installed in the vehicle or if it is removable from a permanently installed housing unit, designed to be powered solely by the car’s electrical system, and in or upon the car at the time of the loss. The form provides coverage for devices in cars the policyholder owns and those she rents or borrows. As with the other form, she can buy coverage in amounts up to $5,000.

The additional premium for this coverage is normally small. A rate of $4 for every $100 of coverage is typical. For example, the cost for $2,500 of coverage might be around $100.

As car buyers ask carmakers to add more and more gadgets to cars, insurance coverage for those gadgets will continue to evolve. It is unwise to assume that an insurance policy automatically provides much coverage for these gadgets. All insurance buyers should carefully review their policies and ask their agents questions if GPS coverage is a concern. With a GPS and the right insurance coverage, a driver can be confident that she’s going in the right direction.

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