Jan. 24—ST. LOUIS — Two main insurance coverage corporations have refused to concern new insurance policies on some Kias and Hyundais within the St. Louis area as theft charges of these autos stay excessive following final yr’s surge.
In a seemingly unprecedented transfer, insurance coverage behemoths resembling Progressive and State Farm are declining to open new insurance policies on Kias and Hyundais altogether, whereas drivers with present plans are caught paying more and more excessive premiums.
“I have been on this business for 15-plus years. It is arduous to name a precedent for this,” stated Michael Barry, spokesman for Insurance coverage Info Institute, a shopper training group.
Charges of stolen Kias and Hyundais exploded final yr — a development additionally seen nationally due to a viral TikTok video that reveals the right way to break into and drive off in lots of 2011-21 fashions of the South Korean-made autos utilizing only a screwdriver and a USB charging cable. The strategy can be utilized on some fashions of these vehicles as a result of producers didn’t set up engine immobilizers, an electrical anti-theft safety machine.
Thefts of Kias and Hyundais jumped 1,450% final yr within the metropolis, from 273 to three,958. The identical was true in St. Louis County, the place a soar from 140 to 1,621 marked a 1,157% enhance.
Florissant resident Dru Dickerhoff stated he started purchasing round for a greater price on his 2016 Kia Soul after his newest six-month premium with American Household Insurance coverage was $150 greater than when he and his spouse purchased the automobile new in 2016.
“My spouse and I’ve nice credit score, fee historical past, we pay six-month premiums, we have now no claims and no accidents on this Kia — primarily your good insurance coverage buyer in all respects,” he stated. “I wasn’t anticipating it to get turned down.”
Each State Farm and Progressive declined to supply Dickerhoff any protection.
When Kia and Hyundai house owners within the St. Louis space apply for a quote on-line, Progressive robotically points a denial message: Based mostly on the car’s make and mannequin, and excessive theft charges within the space, the corporate is unable to supply a coverage. That very same message pops up for drivers in different components of the nation the place theft charges are significantly excessive, stated Jeff Sibel, a spokesperson for Progressive.
The corporate made the choice to cease providing new insurance policies in November, stated Jim Kirn, proprietor of KIRNCO Insurance coverage in St. Louis, which sells Progressive insurance coverage.
State Farm made an analogous resolution to say no new insurance policies in November, stated State Farm salesperson Josh Franklin. A company State Farm spokeswoman declined to remark.
Different insurers, resembling Nationwide and Geico, have opted to lift drivers’ premiums on these makes and fashions as a substitute. St. Louis insurance coverage agent Osvaldo Aguilar stated premiums on these particular vehicles are rising at a better price than different autos.
Maplewood resident Jay Zunich stated the six-month Geico premium for his 2020 Hyundai Elantra went up by about $200 when he renewed the coverage in December — from about $600 to $800.
“My first thought is, ‘Holy cow that is outrageous,'” he informed the Publish-Dispatch. “So I begin purchasing round.”
He, too, was denied by Progressive. Different corporations quoted him charges as excessive as $350 a month for his automobile, regardless that his Elantra is a push-start and can’t be stolen the way in which key-start fashions may be.
“It is undoubtedly irritating,” he stated.
Regardless of corporations’ rising charges — and outright refusals by others — Missouri’s Insurance coverage Shopper Affairs Division, which investigates complaints in opposition to insurance coverage corporations, has not acquired any complaints about corporations refusing to supply protection, stated Caty Luebbert, a spokeswoman for the division.
“We’re conscious that insurance coverage corporations are contemplating enterprise selections on how greatest to take care of the rise in thefts of sure makes and fashions of those autos,” Luebbert wrote in an electronic mail. “Our division is monitoring the state of affairs and dealing diligently to make sure that the enterprise selections adjust to the Missouri insurance coverage legal guidelines and rules.”
The businesses are “effectively inside their rights” to refuse new insurance policies, stated Barry, with the Insurance coverage Info Institute. He famous that insurance coverage corporations usually wish to hold present prospects, however they will legally concern nonrenewal notices to policyholders so long as they supply about two months’ discover.
Officers suggest drivers safe their Hyundais and Kias with a automobile wheel membership and phone the producers about safety kits that may be put in to stop theft. A Hyundai spokesperson stated engine immobilizers at the moment are commonplace on all Hyundai autos produced as of November 2021.
Three nationwide insurance coverage teams despatched a joint letter to YouTube final week urging the social media platform to take away how-to movies that present detailed directions for stealing Kias and Hyundais.
And in August, St. Louis took steps to carry the automobile producers accountable, demanding in a letter that the businesses take accountability for the thefts, and threatened a lawsuit over the defect if they didn’t.
Kia and Hyundai attorneys famous of their response to the town the safety machine just isn’t federally required.
However in an ongoing, nationwide class-action go well with in opposition to the producers, attorneys argue it’s federally required for vehicles to have a system that doesn’t begin or steer when the secret is eliminated.
“When the secret is faraway from the beginning system, neither steering nor ahead self-mobility is prevented,” the go well with stated. “If it had been, the autos wouldn’t be stolen at alarming charges.”
Editor’s observe: This story has been up to date with an announcement from Hyundai.
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