Insurers to recoup Toyota recall crash claims

Insurance companies are gearing up to recoup from Toyota money they paid for claims in crashes involving sudden acceleration, the subject of major safety recalls by the Japanese automaker. It could also mean money back for some drivers who paid deductibles.

At least six major insurers, including State Farm, Allstate and Geico, have begun examining past claims involving the recalled vehicles, which number about 6 million in the United States and 8 million around the world. Insurers can request that Toyota pay them for the claim if a vehicle defect is proven to be a key factor in a crash, a long-standing industry practice known as subrogation.

Many insurers have begun notifying Toyota that they will do just that. "We're seeking to have them share in some of the financial liability, because part of it is their fault," State Farm spokesman Phil Supple said.

The move could repay some Toyota owners their out-of-pocket costs due to crashes but probably wouldn't have much of an impact on the premiums drivers pay. And it would mostly involve crashes in which people weren't seriously injured, because those cases frequently find their way into lawsuits.

FINE agreement: The Transportation Department expects Toyota to agree today to pay a fine of more than $16 million for a four-month delay in telling the government about defective gas pedals on its vehicles, the largest civil penalty imposed on an automaker by the government. Toyota faced a deadline to accept or contest the $16.4 million fine over evidence it knew about sticking gas pedals in September but did not issue a recall until January.

Insurers to recoup Toyota recall crash claims 04/18/10 [Last modified: Monday, April 19, 2010 12:06am]

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