Allstate and several subsidiaries have filed a federal lawsuit against Hyundai and Kia, claiming the automakers knowingly failed to address defects in millions of vehicles, resulting in severe fire risks.
The lawsuit, filed in the U.S. District Court for the Central District of California, accuses Hyundai and Kia of “purposefully and knowingly” neglecting to recall defective vehicles, thereby putting lives and property at risk. The issue dates back to at least 2006 and has reportedly led to numerous incidents of cars spontaneously erupting in flames, even when parked.
The suit highlights consumer complaints filed with the National Highway Traffic Safety Administration (NHTSA) beginning in 2011. One complaint involved a Hyundai vehicle that caught fire while parked in a driveway. A forensic engineer attributed the fire to moisture in the braking system, which caused a short circuit in the engine compartment.
Hyundai and Kia have issued 17 safety recalls to date, but the lawsuit alleges that some fixes were inadequate. “The unfair and deceptive trade practices committed by defendants caused plaintiffs’ damages,” the insurers stated in the lawsuit.
Allstate and its subsidiaries, including Esurance, National General, Integon and Safe Auto, claim their insured customers suffered extensive damages, including repair costs, loss of vehicle use, rental expenses and property damage caused by vehicle fires.
In November 2020, Hyundai and Kia reached a consent order with the NHTSA, agreeing to pay a record $210 million civil penalty for failing to recall over 1.5 million vehicles in a timely manner.
The lawsuit aims to recover the costs paid to insured customers for damages, holding Hyundai and Kia accountable for their alleged negligence.
