Auto Insurance Companies' Response to Rising Car Theft Rates: Hyundai and Kia Vehicles without Immobilizers

Auto insurance companies Progressive and State Farm's decided to refuse policies for older Hyundai and Kia vehicles lacking immobilizers. According to the Highway Loss Data Institute, some 2015 through 2019 models of these vehicles are twice as likely to be stolen than other vehicles of a similar age. Additionally, this problem has become a social media trend in 2021, with car thieves filming their joyrides and even tutorials on how to steal the cars. The thefts have also become more expensive, with theft claims of Hyundai and Kia models spiking to more than thirty times their 2019 levels in Wisconsin. Therefore, it is not surprising that Progressive and State Farm have increased insurance rates and limited sales of policies on these models in certain geographic regions.

Prioritizing Safety and Security

The decision of these two companies would encourage other insurance providers to prioritize the safety of their clients and be more selective when writing policies for cars that are easy targets for criminals. Insurance companies tend to expand their market share, but this should not be at the expense of the security and peace of mind of their clients. The fact that other vehicles in these Hyundai and Kia model years have engine immobilizers installed and that these cars are lacking them should be seen as a red flag for insurance companies. Given that they price their policies based on risk levels, it becomes challenging for insurers to offer competitive rates for these models, especially in the market that has experienced explosive increases in the rate of thefts.

Improving Vehicle Security

Hyundai and Kia have taken steps to improve the security of their vehicles by offering free software upgrades and steering wheel locks to police departments and owners, respectively, while their dealerships install security kits for their customers. Auto theft not only results in financial losses for individuals but also increases the cost of insurance premiums for policyholders, making it a problem for everyone in the industry. It is important to continue to develop and implement technology that protects cars and drivers from theft to save individuals from financial losses and reduce auto insurance premiums for everyone.