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New policies for some Kia, Hyundai models halted by 2 major insurance companies

Cars have been subject to increased thefts. However, insurance laws vary state to state, and New York drivers may not be impacted.

BUFFALO, N.Y. — Another shoe has fallen as a result the rash of thefts of Kia and Hyundai vehicles.

Two major insurance companies, Progressive and State Farm, say that for now, they won't issue new policies for certain makes and models, according to reports.

The insurance companies did not provide a list of vehicles that they will not insure right now. But a spokesperson for Kia said the impacted models include “2011 to 2021 Kia vehicles equipped with a steel ignition key for turn-to-start operation.”

Hyundai didn’t provide information about impacted models, but a spokesperson said in a statement that the company “regrets this decision by insurers and its impact on select Hyundai vehicle owners and lessees.”

State Farm has “temporarily stopped accepting new customer applications in some states for certain model years and trim levels of Hyundai and Kia vehicles because theft losses for these vehicles have increased dramatically,” a spokesperson said.

“During the past year we’ve seen theft rates for certain Hyundai and Kia vehicles more than triple and in some markets these vehicles are almost 20 times more likely to be stolen than other vehicles,” said a spokesperson For Progressive. “Given that we price our policies based on the level of risk they represent, this explosive increase in thefts in many cases makes these vehicles extremely challenging for us to insure.”

Some things to keep in mind

This decision, so far, only involves the two carriers. 

It also only involves "new business," or new policies sought by motorists, so no one is getting their current policy dropped because of this.

It only involves certain models, and is only being done in certain parts of the country. 

Move comes as no surprise

"A move by a company to hold off on selling some polices in this high risk climate really shouldn't be considered unusual," said Scott Holeman, a spokesperson for the Insurance Information Institute.

Insurance is issued and priced largely based on risk factors. For car insurance this can include the age of a driver, their driving record, how often they use the vehicle, and where its kept.

It also may include how likely it is to be stolen. 

Theft insurance claims among 2015-2019 model-year vehicles were nearly twice as common for Hyundai and Kia vehicles than those from all other manufacturers, according to an analysis of 2021 insurance claims from the Highway Loss Data Institute (HLDI).

"Let's face it, these are unusual times," Holeman said. "There are video stories with hashtags out there with 30 million views showing people how to hotwire a car with a simple phone charger and we're seeing kids as young as young as 11 years old participating in these theft challenges."

Effect on New York drivers

Two State Farm agents locally said they were still issuing policies for all makes and models of Kia and Hyundai vehicles. 

One of them told 2 On Your Side they believed it was due to state laws.

Insurance regulation are different state to state.

In New York, the insurance business is regulated by New York State Department of Financial Services (DFS).

While companies can choose not to insure a specific make or model of car based on their underwriting guidelines, they cannot violate any unfair discrimination laws. New York Insurance Regulation 90 prohibits geographical redlining and discriminating in certain property/casualty policies, including private passenger auto policies. Refusing to insure a specific make or model of car in certain areas would violate Regulation 90. 

According to DFS, it has not received any complaints on this issue to date.

You can still find insurance

Even if you can't get insurance from one company, it certainly doesn't mean you can't get it from another.

"Insurance, particularly auto insurance, is a highly competitive industry. There are a lot of people that want to do business with you," said Holeman, who added that the Insurance Information Institute encourages consumers to regularly review their policies, and shop around for the insurance that best fits their needs.


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