The theft of older models of Hyundai and Kia that lack critical anti-theft devices could result in losses of up to $600 million for the U.S. insurance industry.
Liberty Mutual, Nationwide, American Family, and 65 other insurers estimate that their payout to affected owners could exceed $300 million, with $190 million already paid out.
These insurers have filed a lawsuit in U.S. District Court in Orange County, Calif., seeking reimbursement from Hyundai and Kia for funds paid to owners for replacement or repair of stolen or damaged vehicles.
The insurers claim that the cost of repairing windows and steering columns damaged during theft attempts can exceed $3,000. Stolen vehicles used for joyrides or other crimes can incur damages of over $10,000, and if not recovered, can result in a total loss of up to $20,000.
Hyundai and Kia have acknowledged that some of their vehicles on the road in the U.S., particularly base trim or entry-level models, lack push-button ignitions and anti-theft devices (engine immobilizers). However, the insurers’ lawsuit demonstrates the extent of the problem faced by the companies, which started with a TikTok video and has now become a nationwide legal issue.
One victim of this theft, Alex Gerwer, had his daughter’s 2019 Hyundai Tucson stolen and deemed unrecoverable by their insurance company, Geico. The offered payout of $23,000 was deemed inadequate by Gerwer as it did not replace the car with a similar model nor reimburse the remaining warranty. Gerwer is skeptical that any award will truly compensate the victims of Hyundai’s negligence.
Source: AutoNews (Subscription Required)