Does Auto Insurance Cover Fire Damage?

Summary / TL;DR: Yes, auto insurance can cover fire damage to your car, but only if you have the right coverage in place. Comprehensive coverage (part of “full coverage” car insurance) will pay for fire damage to your vehicle, whether the blaze was caused by a random accident, wildfire, vandalism, or other non-collision events. If the fire is the result of a car crash, your collision coverage (or the at-fault driver’s liability insurance) would cover the damage. However, a liability-only policy will not cover any repairs or losses to your own car from fire. (For guidance on getting proper coverage, call 773-202-5060 anytime.)

Car fires can be truly devastating. In fact, vehicle fires are more common than many people realize. The U.S. fire departments respond to roughly 19 vehicle fires every hour, accounting for about 1 in 8 fire emergency calls. Modern cars contain complex electronics and fuel systems that can be completely destroyed by fire. Often, a car that catches fire ends up being declared a total loss due to the extensive damage. This makes it essential to have the right insurance protection for your vehicle in case of fire.

What type of car insurance covers fire damage?

Auto insurance will cover fire damage to your car only if you carry the proper coverage. So, specifically, you’ll need comprehensive coverage (and in some cases collision coverage) for fire-related losses. This insurance is the portion of an auto policy that covers damage from events other than a collision, things like fire, theft, vandalism, or natural disasters. While it’s an optional coverage (not legally required), it’s the only protection that pays for your car’s repairs or replacement if it’s damaged by fire.

On the flip side, basic liability insurance (the minimum coverage required by law in almost every state) will not pay for damage to your own vehicle from a fire. Liability coverage only covers injuries or damage you cause to others’ property. For example, Illinois (like all states) mandates liability insurance for all drivers, but if your car burns up and all you carry is liability, your policy won’t cover your car’s fire damage. In summary, you need physical damage coverage on your policy to be protected from fire losses on your own vehicle.

It’s also important to know the role of collision coverage. If the car fire was caused by a traffic accident (for instance, a crash that ruptures the fuel tank and ignites a fire), the collision portion of your policy would typically cover the damage to your car. Collision insurance pays for your vehicle’s damage from impact or collision-related events, including fires resulting directly from a crash. On the other hand, if a fire starts by itself (not due to a crash), then comprehensive coverage is what applies. In practice, people who say they have “full coverage” usually mean they have both collision and comprehensive, along with liability. Having this full coverage package ensures that no matter the cause of the fire, your car should be covered.

Another scenario is if another driver crashes into you and causes your car to catch fire, their insurance (specifically their liability coverage) may ultimately be responsible for your damages. In that case, you could make a third-party claim against the at-fault driver’s liability insurance to cover the fire damage to your vehicle. But you’d still need your own collision coverage to get your car fixed promptly, while your insurer negotiates with the other party’s insurer. 

Will liability-only insurance cover a car fire?

Liability insurance is there to protect other people from damage you cause; it doesn’t pay anything to fix your vehicle in the event of fire, theft, or any other non-collision incident. For example, if your engine catches fire or your parked car is burned by vandals, a basic state-minimum policy (liability only) won’t pay a dime toward your car’s repair or replacement.

The only time liability coverage even comes into play with a car fire is if you are at fault for an accident and another vehicle catches fire as a result. In that case, your liability insurance would pay for the other driver’s vehicle damage (including fire damage), but again, it would not cover your vehicle. Similarly, if you rear-end someone and both cars go up in flames, your liability policy helps the other party, but your own car is not covered at all. This harsh reality often hits drivers with only liability coverage when they experience a fire loss.

What car fire incidents are covered by insurance?

When you have the proper coverage (comprehensive and/or collision), car insurance can cover almost all types of fire-related damage to your vehicle. Below is a breakdown of common car-fire scenarios and how insurance would typically handle each:

Does car insurance cover wildfire or forest fire damage?

Damage from wildfires, brush fires, lightning strikes, and other natural fires is covered by car insurance as long as you have comprehensive coverage. Comprehensive is often described as covering “Acts of God,” meaning events outside of human control. This includes wildfire damage, forest fires, and smoke or ash damage from such disasters. In recent years, many U.S. states have seen catastrophic wildfires, and fortunately if your vehicle is caught in one, a comprehensive auto policy will pay for the losses (after your deductible).

It’s important to have the coverage in place before any disaster strikes. You typically cannot buy comprehensive coverage at the last minute once a known wildfire or natural disaster is already imminent or ongoing because insurers may temporarily halt new policy changes in affected areas. Therefore, if you live in a wildfire-prone region (or even if you don’t, fires can be unpredictable), maintaining comp coverage on your car is wise. 

Also, remember that smoke damage and water damage from firefighting efforts are generally covered under comprehensive as well. So if your car survives the flames but suffers smoke damage or gets doused with water/foam, those damages would be part of the claim.

Does auto insurance cover personal belongings lost in a car fire?

Car insurance is designed to cover the vehicle itself (and attached equipment), not the contents you might be carrying. So if you had a laptop, tools, or other personal possessions in your car and they burned or were ruined in a fire, your auto policy’s comprehensive coverage will not pay to replace those items. 

With that said, there’s still a way to secure your belongings with the homeowners or renters insurance. Most homeowners/renters policies have “off-premises” personal property coverage, which applies to your items even if they are outside your home, such as in your car. That means if your car catches fire and your personal items (e.g. clothing, electronics, sports gear) are destroyed, you could file a claim under your homeowner’s or renter’s insurance for those losses. You would have to pay the homeowner’s policy deductible and be subject to its coverage limits for personal property.

For example, if a car fire destroys a $1,000 laptop in your vehicle, your auto insurer won’t cover it, but your homeowner’s policy likely will (minus the deductible, often around $500 or $1,000). Be sure to check your specific policy terms and note that filing a claim on your home insurance for personal items could affect that policy’s claims history. If the value of items is not very high, some people choose not to file such a claim. 

Tip: If you frequently carry high-value items in your vehicle, talk to your agent about coverage. In some cases, you can get a rider on your homeowner’s policy for certain belongings, or just be aware of the protection you have. Auto insurers do offer limited coverage for aftermarket stereo equipment or custom parts attached to the car, but personal goods like phones, laptops, handbags, etc., are excluded from auto coverage.

If I accidentally set my own car on fire, am I still covered?

Insurance policies differentiate between intentional acts (which are not covered) and accidental incidents (which are covered). So if you accidentally cause a car fire without meaning to (for example, a garage mishap, or a dropped cigarette that unintentionally ignites the interior), your comprehensive coverage should still pay for the damage. The key is that there was no intent to cause harm. Insurers understand that accidents happen. As long as you did not willfully set the car ablaze, your claim for the fire damage would be valid.

However, be aware of two things. Negligence and fraud investigations. If your actions were extremely careless (grossly negligent), an insurer might try to deny the claim arguing you failed to take reasonable precautions. This is uncommon, but as an example, imagine you left an open container of gasoline in your car and it ignited in the heat, the insurer could question your negligence. Generally though, negligence exclusions are applied in only the most egregious cases. For typical “accidental” fires, you are covered.

Insurance companies will also investigate car fire claims to rule out arson or fraud. Car fires can sometimes be used as a scheme to get an insurance payout (for instance, if an owner finds themselves upside-down on a car loan and sets the car on fire deliberately). If the investigation finds that the fire was intentionally caused by the owner for financial gain, the claim will be denied and the owner could face legal consequences. But if it truly was accidental, you have nothing to worry about. Comprehensive insurance will make you whole. 

What happens if my car is totaled by a fire?

Car fires often result in extensive damage, and it’s not uncommon for the vehicle to be deemed a total loss. A vehicle is considered a “total loss” when the cost to repair it is at or above its current value. If you have the appropriate coverage (comprehensive or collision, depending on the situation) and your car is totaled by a fire, your insurance will pay you the value of the car (minus your deductible). Specifically, the insurer will pay the actual cash value (ACV) of your vehicle which is essentially the market value of the car right before the fire occurred.

For example, if your car was worth $10,000 and your comprehensive deductible is $500, the insurance payout would be around $9,500. This ACV is determined by the insurer by looking at the make, model, year, mileage, and condition of your vehicle (pre-fire) and comparing to market prices for similar cars. It’s not based on what you originally paid for the car, but rather what it was worth at the time of loss. Keep in mind, cars depreciate over time, so the older your car, the lower the ACV likely is.

Once the insurance company settles the total loss and issues payment, they will take possession of the burned vehicle in most cases. The insurer essentially “buys” the wreck from you as part of the settlement. They will then send the vehicle to a salvage auction or scrap yard. You, as the owner, would sign over the title to the insurance company. (If you want to keep the charred vehicle for some reason, there is an option to “retain salvage” in exchange for a reduced payout, but most people don’t keep totaled fire cars.)

If your car is financed or leased, the insurance payout will typically go to the lender or leasing company (since they have a lien on the vehicle). You would then coordinate with your lender. If the payout is more than what you owe on the loan, you receive the difference; if it’s less, you would still owe the remaining loan balance unless you have gap insurance. Gap insurance is an optional coverage that pays off any loan balance beyond the ACV, and it can be very helpful in a total loss situation. Fire losses are handled just like other total losses in this regard.

Frequently Asked Questions

Does car insurance cover fire damage?

Yes, but only if you have added coverage for it. Standard liability insurance does not cover fire damage to your own car. You need comprehensive coverage (part of full coverage) for your auto policy to pay for damage if your car catches fire. If the fire is caused by an accident, collision coverage would cover it (or the other driver’s insurance if they were at fault). 

What type of insurance covers car fires?

Comprehensive auto insurance is the primary coverage that protects your car against fire. Comprehensive (often paired with collision as “full coverage”) covers your vehicle for non-collision events like fire, theft, vandalism, and natural disasters. If the fire resulted from a collision, then collision insurance covers it. To be fully protected from all types of car fires, you should have both comprehensive and collision coverage on your policy. These are optional coverages that you must elect to purchase.

Will my liability insurance pay if my car burns up?

No, liability insurance won’t pay for your car’s fire damage. Liability coverage only pays for damage or injury you cause to others. It does not cover any damage to your own vehicle from any cause, including fire. So if you only have liability insurance and your car is destroyed in a fire, your insurer will not pay to repair or replace your vehicle. You would be responsible for the loss personally. The only connection liability coverage has with fire is if you cause a fire that damages someone else’s property. Then your liability policy would pay for their damages. But your own car’s fire damage requires comprehensive/collision coverage on your policy.

Does “full coverage” car insurance include fire damage?

Yes. “Full coverage” is a common term for having both comprehensive and collision coverage (in addition to the required liability coverage). If you have full coverage auto insurance, your car is covered for fire damage. Comprehensive coverage within that full package will pay for fires due to non-accident causes (engine fire, arson, garage fire, wildfire, etc.), and collision coverage will cover fires resulting from a crash. Just remember that “full coverage” isn’t a specific policy type, but if you tell your agent you want full coverage, fire protection will be part of that. Always confirm that comprehensive is included, as that is the piece that covers fire in most scenarios.

Are wildfires and natural fires covered by car insurance?

Yes, if you have comprehensive coverage. Wildfires, forest fires, lightning strikes, or any kind of natural-disaster-related fire are covered under the comprehensive portion of your auto insurance. Comprehensive is what handles “act of God” events. So if a wildfire or brush fire burns your parked vehicle, your insurer will reimburse you for the damage under a comprehensive claim (minus your deductible). Without comprehensive, you’d have no coverage for natural fires. It’s also worth noting that smoke damage from wildfires is covered by comp as well. Always carry comprehensive coverage if you want protection from natural disasters like wildfires.

Does car insurance cover electrical fires or engine fires?

Yes. An electrical short-circuit or a mechanical malfunction that causes an engine fire is covered by auto insurance as long as you have comprehensive coverage on the vehicle. These kinds of fires are considered accidental, non-collision losses, which is exactly what comprehensive is designed to cover. The insurance company will pay to repair the damage or declare the car a total loss if the fire damage is beyond repair. You would file a comprehensive claim in this situation. (If the fire was triggered by a collision, that becomes a collision claim instead.) But any internal fire not related to a crash is handled by comp coverage.

If my car is totaled by fire, how much will insurance pay?

If you have coverage for the loss, insurance will pay you the actual cash value of the car at the time of the fire. In other words, they’ll cut a check for the vehicle’s market value (pre-fire), minus your deductible. This is often determined by looking at comparable vehicle sales or valuation guides. For example, if your car is worth about $8,000 and you have a $500 deductible, the insurer’s payout would be roughly $7,500. If your car was brand new, you might get the replacement cost if you had a special new car replacement endorsement; otherwise it’s the used market value. The policy will not pay more than the car is worth (you cannot profit from the claim). Once that ACV amount is agreed upon and paid, the insurer takes ownership of the salvage vehicle.

What should I do if my car catches fire?

If you experience a car fire, pull over (if driving), turn off the engine, and get yourself and any passengers far away from the vehicle. Do not attempt to fight a large car fire on your own because car fires can spread and even lead to explosions due to flammable fuels. Call 911 and let the fire department handle the situation. Once the fire is extinguished and everyone is safe, you can begin the insurance process. Document the incident if possible (photos of the aftermath), and as soon as practical, notify your insurance company to start a claim. They will likely send an adjuster to inspect the remains of the vehicle. Obtain a copy of the fire department’s report as well, since insurers often require official confirmation of the cause of fire. Importantly, do not remove the vehicle or alter the scene without insurer approval. Let them investigate if needed. After you file the claim, the insurance company will advise you on next steps (such as towing the vehicle, getting a rental car if your policy has rental coverage, etc.). 

Will a fire damage claim raise my insurance rates?

Comprehensive claims (including fire damage claims) typically have less impact on your insurance rates than at-fault accident claims. Since a car fire is usually not the driver’s fault (unless it was due to an accident you caused), many insurers do not surcharge premiums for comprehensive claims. However, some insurers might factor in any claim when determining your rate at renewal. You could lose a claims-free discount, for instance. If the fire was caused by another driver who was at fault, that claim would go on their insurance, not yours. Generally, one comprehensive claim for something like a fire should not result in a drastic premium increase, especially compared to a collision claim. It’s always wise to ask your agent about the potential rate impact. But the priority should be getting your vehicle restored; insurance is there for that reason. If your car caught fire and you have coverage, don’t hesitate to use it. 

Car fires can happen unexpectedly, from mechanical failures, accidents, or external events, and the damage is often severe. By carrying comprehensive coverage (and collision coverage for accidents), you ensure that your insurance will cover fire damage and help you recover quickly. If you’re unsure about your coverage or need to add fire protection, give us a call at 773-202-5060. Protect your vehicle today so that even in a worst-case scenario like a fire, you’ll have peace of mind knowing you’re covered.