Some car insurance companies refuse to cover some Hyundai and Kia models

CNN
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Progressive and State Farm, two of America’s largest auto insurers, are refusing to write policies in certain cities for some older Hyundai and Kia models that have been deemed too easy to steal, according to the companies.

Multiple reports say the companies have stopped offering insurance on these vehicles in cities that include Denver, Colorado and St. Louis, Missouri. The insurance companies did not tell CNN which cities or states were involved.

The Highway Loss Data Institute released insurance claims data last September that confirmed what various social media accounts had been says: Some Hyundai and Kia models from 2015 to 2019 are about twice as likely to be stolen as other vehicles of the same age, because many of them lack some of the basic anti-theft technology included in most other vehicles these years, according to HLDI.

Specifically, these SUVs and cars do not have electronic immobilizers, which rely on a computer chip in the car and another in the key communicating to verify that the key really belongs to that vehicle. Without the correct key, an immobilizer should do just that – stop the car from moving.

Immobilizers were standard equipment on 96% of vehicles sold for the 2015-2019 model years, according to HLDI, but only 26% of Hyundais and Kias had them at the time. Vehicles that have push-button start systems, rather than relying on metal keys that must be inserted and turned, have immobilizers, but not all models with turnkey ignitions do.

Stealing these vehicles became a social media trend in 2021, according to HLDI, when car thieves started posting videos of their thefts and drives and even videos explaining how to steal the cars. In Wisconsin, where the crimes first became widespread, claims for theft from Hyundais and Kias rose to more than 30 times the 2019 dollar level.

“State Farm has temporarily stopped writing new business in some states for certain model years and trim levels of Hyundai and Kia vehicles because theft losses for these vehicles have increased dramatically,” the insurer said in a statement to CNN. “This is a serious issue that affects our customers and the entire auto insurance industry.”

Progressive is also cutting back on insuring these cars in some markets, spokesman Jeff Sibel said in an email.

“Over the past year, we have seen the theft rate of some 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,” he wrote. “Given that we price our policies based on the level of risk they represent, this explosive increase in theft in many cases makes these vehicles extremely challenging for us to insure. In response, in some geographic areas, we have increased our prices and limited the sale of new policies on some of these models.”

Progressive continues to insure those who already have policies with the company, he said. Progressive also advises them on how to protect their vehicles from theft.

Michael Barry, a spokesman for the Insurance Information Institute, said it was very unusual for auto insurers to simply stop writing new policies on a given vehicle make or model.

“They generally want to expand their market share depending on where they do business,” he said.

Hyundai and Kia operate as separate companies in the United States, but Hyundai Motor Group owns a large stake in Kia and various Hyundai and Kia models share much of their engineering.

Engine immobilizers are now standard on all Kia vehicles, according to a statement from the automaker, and the company says it has developed and tested safety software for vehicles not originally equipped with an immobilizer. Kia said it has begun notifying owners of the availability of this software, which is offered free of charge.

Hyundai said it is providing free steering wheel locks to some police departments around the country to provide local residents who have Single stolen Hyundai models. Hyundai dealers are also installing free safety kits for the vehicles, the company said.